Trust of Rose P. Mcmanus v. Mcmanus

• Decision Date: 10 May 2011
• Docket Number: No. 2009–191–Appeal.,2009–191–Appeal.
• Parties: TRUST OF Rose P. McMANUS, Elizabeth Cullen, Trusteev.Albert McMANUS et al.
• Court: Rhode Island Supreme Court

18 A.3d 550

TRUST OF Rose P. McMANUS, Elizabeth Cullen, Trustee

v.Albert McMANUS et al.

No. 2009–191–Appeal.

Supreme Court of Rhode Island.

May 10, 2011.

James P. Howe, Esq., Providence, for Petitioner.James S. Lawrence, Esq., Warwick, for Respondent Daniel McManus.Joseph J. Nicholson, Jr., Esq., Newport, for Respondent Albert T. McManus, Jr. and Jane Martino.Present: SUTTELL, C.J., GOLDBERG, FLAHERTY, ROBINSON, and INDEGLIA, JJ.

OPINION

Justice FLAHERTY, for the Court.

This dispute arose when four siblings disagreed over how the estate of their mother should be divided. One sister, Elizabeth Cullen,¹ who was the trustee of the mother's inter vivos trust, filed a petition for an order to discharge her and to distribute the trust assets. Her brothers, Albert McManus, Jr., and Daniel McManus, and her sister, Jane Martino, objected. They counterclaimed, alleging that Elizabeth had misappropriated trust funds by failing to include the balance of a bank account in the trust assets. The trial justice granted summary judgment in favor of the siblings. It is from that judgment that Elizabeth now appeals.

This case came before the Supreme Court on April 6, 2011, pursuant to an order directing the parties to appear and show cause why the issues raised in this appeal should not summarily be decided. After hearing the arguments of counsel and reviewing the memoranda of the parties, we are satisfied that cause has not been shown. Accordingly, we shall decide the appeal at this time without further briefing or argument. For the reasons set forth in this opinion, we affirm the judgment of the Superior Court.

Facts and Travel

On August 4, 2003, Rose McManus and her daughter Elizabeth opened a bank account at Citizens Bank. Apparently, the pair hoped that the account would make it easier for Elizabeth to care for her mother as she aged. There is no dispute that the money used to open the account belonged to Rose exclusively. There was a signature card, signed by both Rose and Elizabeth, that indicated that the account was “joint,” but, significantly, the card did not include the phrase “right of survivorship.” As soon as they opened the account, Elizabeth and her mother were provided with a form entitled “Disclosure for Personal Accounts.” The disclosure provided information about various types of accounts and listed the possible forms of joint accounts as “Joint Account—With Survivorship (And Not As Tenants In Common)” and “Joint Accounts Opened With Only One Signature.” This latter document explained that, for convenience, one account-holder could establish a joint account with only one signature and have the co-owner sign and return the signature card.

When Rose died on February 21, 2004, she was the survivor and trustee of an inter vivos trust that had been established by her and her late husband. ² Rose had also executed a will that provided for the distribution of her estate through the trust by means of a “pour-over” provision. The trust agreement said that at Rose's death, the “balance of the principal of the Surviving Spouse's trust” was to be divided equally and distributed to each of Rose's then-living children, who were Albert, Jr., Daniel, and Jane, as well as Elizabeth. With the exception of the Citizens Bank account, the assets of the trust were divided and distributed without incident. At the root of this dispute is whether the Citizens Bank account was opened with a right of survivorship in Elizabeth, which would exclude it from the trust. In the alternative, if there was no right of survivorship, then the proceeds of the joint account should have been included in the assets of the trust and distributed evenly among the four siblings, as directed by the trust agreement.

Elizabeth argued that the account had a right of survivorship; her siblings did not agree. To resolve the dispute, Elizabeth filed a petition in the Superior Court seeking an order to discharge her as trustee and deliver the trust assets.³ The siblings responded to the petition and filed a counterclaim in which they alleged that Elizabeth had misappropriated money that properly belonged in the trust. After hearing arguments on the issue of whether the account gave Elizabeth a right of survivorship, the Superior Court granted summary judgment in favor of respondents. The motion justice reasoned that, although the signature card was stamped “joint,” there was no reference to survivorship rights. The trust of Rose McManus, through the trustee, Elizabeth, appealed.⁴

Standard of Review

“This Court reviews de novo a trial justice's decision granting summary judgment.” Lynch v. Spirit Rent–A–Car, Inc., 965 A.2d 417, 424 (R.I.2009) (citing Cullen v. Lincoln Town Council, 960 A.2d 246, 248 (R.I.2008)). This Court will affirm summary judgment if, when viewing the evidence in the light most favorable to the nonmoving party, “there exists no genuine issue of material fact and the moving party is entitled to judgment as a matter of law.” Id. (citing Cullen, 960 A.2d at 248). “The party opposing summary judgment bears the burden of proving, by competent evidence, the existence of facts in dispute.” Id. (quoting Cullen, 960 A.2d at 248).

Analysis

Elizabeth argues that the presence of the word “joint” on the signature card, when combined with the verbiage of the “Disclosure for Personal Accounts,” which was given to her and her mother when they opened the account, created a right of survivorship for the account. We do not agree. Neither document gives any indication of a right of survivorship, which is necessary to create such an interest. Our holdings in Gaspar v. Cordeiro, 843 A.2d 479, 481 (R.I.2004), and Robinson v. Delfino, 710 A.2d 154, 160–61 (R.I.1998), could not be clearer. Although the signature card is marked in its upper-right corner as “joint,” there is no language there or anywhere else on the signature card suggesting the existence of a right of survivorship in Elizabeth. ⁵

In Robinson, 710 A.2d at 156, 160–61, we clarified the previously unpredictable and inconsistent law applied to joint bank accounts by holding that opening an account and executing signature cards that provide for a survivorship right would be proof of the depositor's intention to transfer an immediate right of ownership to the survivor.⁶ Additionally, we said that the account's failure to specifically provide for survivorship rights is conclusive evidence of the intent not to transfer an ownership right to the survivor. Id. at 161. After Robinson, the depositor's intent regarding a survivorship right was to be examined only when “fraud, undue influence, duress, or lack of mental capacity” was alleged in the creation of the account, which is not the case here. See id.

To try to demonstrate the existence of a genuine issue of material fact, Elizabeth argues that the disclosure that was given to her and her mother when they opened the account must be read as part of the agreement with the bank. Relying on the disclosure, Elizabeth contends that the account descriptions suggest that, because the account was opened with two signatures, it was not a “Joint Account[ ] Opened With Only One Signature” and therefore must include a right of survivorship. The rules in the disclosure, however, apply to the account “depending on the ownership and the beneficiary designation, if any, specified on the account records,” and the account...