Keokuk Sav. Bank & Trust Co. v. Desvaux

• Decision Date: 14 June 1966
• Docket Number: No. 51992,51992
• Parties: The KEOKUK SAVINGS BANK & TRUST COMPANY, an Iowa Corporation, Plaintiff, v. Rea DESVAUX, Defendant-Appellant, and Nell B. Hagerman, Defendant-Appellee.
• Court: Iowa Supreme Court

Page 296

143 N.W.2d 296

259 Iowa 387

The KEOKUK SAVINGS BANK & TRUST COMPANY, an Iowa Corporation, Plaintiff, v. Rea DESVAUX, Defendant-Appellant, and Nell B. Hagerman, Defendant-Appellee.

No. 51992.

Supreme Court of Iowa.

June 14, 1966.

Rehearing Denied Sept. 20, 1966.

Robert Johnson, for Johnson, Phelan & Tucker, Fort Madison, and J. Andy Zenge, Jr., Canton, Mo., for defendant-appellant.

J. A. Concannon, of Boyd, Walker & Concannon, Keokuk, and Craig Hiller, of Kahoka, Mo., for defendant-appellee.

Robert B. Dickey, of Smiths' & Dickey, Keokuk, for plaintiff.

THORNTON, Justice.

This is an action for declaratory relief by plaintiff bank interpleading two depositors.

The stipulated facts are, that on July 3, 1959, James R. Bridges established a joint and survivorship savings account in plaintiff Savings Bank with the names, James R. Bridges or Rea Desvaux in the sum of $7372.84. A savings account passbook representing Account No. 14771 was issued in the above names. The passbook contained rules of the bank in part as follows:

'1. On making the first deposit, the depositor shall be required to subscribe to the rules of the bank. * * *

'6. The depositor must present the pass book in person, or send it with a written order for the payment of the money.'

At the same time a signature card was signed, in pertinent part, as follows:

'* * * The entire account or any part thereof may be withdrawn by, or upon the order of, either of us or the survivor.

'It is especially agreed that withdrawals of funds by the survivor shall be binding upon us and upon our heirs, next of kin, legatees, assigns and personal representatives.'

Following the above, the signature card contained a provision requiring two signatures to effect a withdrawal. This was not signed.

The bank's ledger card shows the initial deposit, one withdrawal, interest credited and one deposit of $3000 made by appellant Rea Desvaux of money she received from James R. Bridges for the return of a deed to real property he had previously given her. The balance in the account on June 7, 1962, was $10,467.28. On November 14, 1962, defendant-appellee Nell B. Hagerman appeared at the bank with a letter dated November 10, 1962, signed by James R. Bridges, in pertinent part as follows:

'My certificate for the amount of ten thousand five hundred dollars has disappeared from my possession and please change it to 'James R. Bridges or Nell B. Hagerman.' Thanks.'

Another signature card identical with the previous one was signed by James R Bridges and Nell B. Hagerman, again a provision for two signatures was not signed. The new account was No. 15635 dated Nov. , 1962. And James R. Bridges signed a receipt on a form provided by the bank for $10,467.48. The receipt in print provided 'and charge to pass book No.' The account number 14771 was typed in as was the following, 'Transferred to new account without presentation of pass book.' The sum of $10,624.49 was transferred to the new account. As stated on the receipt, the transfer from the old to the new account was accomplished without production of the savings passbook. In January, 1963, James R. Bridges died at the age of 99. Appellant through her attorney made demand on plaintiff, presented the passbook together with a written order that the account be delivered to her attorney, plaintiff refused and started this action.

Plaintiff prayed defendants be restrained from withdrawing the funds of $10,624.49 or in the alternative plaintiff hold the funds or pay them into court. It was stipulated with court approval the funds were to remain on deposit with plaintiff.

Plaintiff further prayed the court to declare the rights of each of the defendants to the funds and enter a judgment adjudicating which of these defendants was entitled to the funds and bar and foreclose the claim of the other defendant to said funds and hold plaintiff harmless from further liability to either defendant upon payment of said funds and interest.

Appellant filed an answer wherein she contends the provisions of the signature card are subject to the rules in the passbook and because the passbook was not presented in accord with the rules in the passbook and posted in the bank she is entitled to judgment for the funds. As far as the record here shows, defendant-appellee Hagerman did not file a pleading in the trial court. The case was tried on the theory she contended the funds were transferred in accord with the signature card creating a joint tenancy authorizing the withdrawal on the order of either and presentation of the passbook was unnecessary.

The trial court held that under the terms of the signature card James R. Bridges had the right to withdraw the funds and having done so and placed the funds in a new account with appellee Nell B. Hagerman as joint tenant she is now the owner of the funds.

The principal contention of appellant here is the trial court was in error in not construing the signature card and the rule or bylaw requiring the presentation of the passbook together.

Appellee on the other hand contends the specific agreement in the signature card authorizing the withdrawal on the order of either entered into with knowledge of the bylaw is controlling.

The question presented is one of first impression in this court. The question is, is the passbook rule a part of the contract between the bank and joint depositors? We think it is.

In prior cases, In re Estate of Winkler, 232 Iowa 930, 5 N.W.2d 153, McManis v. Keokuk Savings Bank & Trust Company, 239 Iowa 1105, 33 N.W.2d 410, and Hill v. Havens, 242 Iowa 920, 48 N.W.2d 870, we have considered signature cards identical with the one under consideration here, in In re Estate of Murdoch, 238 Iowa 898, 29 N.W.2d 177, one of similar import. In Hill, supra, at pages 929--930 of 242 Iowa, page 876 of 48 N.W.2d, we said:

'It is now the settled law in Iowa that when a definite written agreement, such as we have here, is made by a depositary bank with its customers, that such agreement is binding upon the bank and the parties signatory, and if it is clear in its terms and meaning, it cannot be changed by parol evidence. The contract is that the bank will, in consideration of the deposit of funds with it and the creation of a debtor-creditor relation between itself and its depositors, consider them as owners in joint tenancy, with right of survivorship, and not as tenants in common; and that upon the death of either depositor any balance in the account shall become the absolute property of the survivor. Language more definite, more explicit, could hardly be devised.'

As is clear from the quoted statement, in each of the above we were considering the rights of the survivor, not the right of one living joint tenant to withdraw as against another. We did not have under consideration that part of the signature card as follows, 'The entire account or any part thereof may be withdrawn by, or upon the order of, either of us * * *.', alone or in connection with a bylaw in the passbook and posted in the bank which required the depositor to present the passbook in person or send it with a written order for the payment of money. Here we do have.

In In re Estate of Winkler, supra, an application in probate by a surviving joint tenant to require the administrator of the deceased joint tenant to surrender the bank book to the applicant, we stated at page 934 of 232 Iowa, page 155 of 5 N.W.2d:

'* * *, that the possession of one would be the possession of both, * * * the possession of the deposit or the book evidencing the deposit of either joint tenant was the possession of the other and it would be immaterial as to who held the actual manual custody.'

In Wilkler it was of course clear the surviving joint tenant was entitled to the possession of the bank book and the deposit. The question there was the ownership of the account which was determined by the joint tenancy agreement. That it was immaterial who had actual possession of the passbook to determine ownership does not mean a withdrawal could be made without the passbook if the agreement so provided. However, if appellee's position here is sound, the surviving joint tenant would not have needed the bank book to obtain the deposit. The signature cards are identical. The passbook would only be evidence to sustain the survivor's claim to the deposit.

If we give full effect to Winkler, supra, not only would the possession of the passbook not affect the right of the other but 'the possession of the deposit' by one was the possession of the other. Inherent in the quoted statement from Winkler, supra, is that withdrawal and possession of the deposit does not terminate the rights of the other joint tenant.

In In re Estate of Miller, 248 Iowa 19, 22, 23, 79 N.W.2d 315, we point out the rules of construction in determining whether a joint tenancy has been created in real and personal property are the same. In the same case at page 24 of 248 Iowa, 79 N.W.2d 315 we said the arrangement was clearly not irrevocable in holding it was not an advancement. The arrangement was, debentures purchased by a father payable to him or his son, 'either one or the survivor', due at stated dates. The debentures were thus payable to either of the named payees. The question of how they would be revocable was not reached. Of course, it could be revoked by agreement. A joint tenancy in real property may be severed by the conveyance of his interest by one of the joint tenants. His purchaser is a tenant in common with the remaining joint tenant. See discussion in both majority and dissenting opinions in In re Estate of Baker, 247 Iowa 1380, 78 N.W.2d 863, 64 A.L.R.2d 902. It is also true the appellant here became vested with an interest when the joint account was created. Perkins v. City National Bank of Clinton, 253 Iowa 922, 933, 114 N.W.2d 45; and In re Estate of Lenders, 247 Iowa 1205, 1219, 78 N.W.2d 536. She had the same right to withdraw funds as James...