Wilhelm v. Wilhelm

• Decision Date: 12 April 1995
• Parties: Joseph J. WILHELM, Sr., and Leanna J. Wilhelm, Appellants, v. Joseph H. WILHELM, Jr., Donald Wilhelm, Mrs. Debra Fleming and Barbara Kovac Yeager, Integra Bank and Northwest Savings Bank, Appellee.
• Court: Pennsylvania Superior Court

Page 34

657 A.2d 34

441 Pa.Super. 230

Joseph J. WILHELM, Sr., and Leanna J. Wilhelm, Appellants, v. Joseph H. WILHELM, Jr., Donald Wilhelm, Mrs. Debra Fleming and Barbara Kovac Yeager, Integra Bank and Northwest Savings Bank, Appellee.

Superior Court of Pennsylvania.

Argued Dec. 13, 1994.

Filed April 12, 1995.

Charles R. Rosamilia, Jr., Lock Haven, for appellants.

George L. Daghir, St. Marys, for appellees.

Before DEL SOLE, FORD ELLIOTT and BROSKY, JJ.

DEL SOLE, Judge:

This is an appeal from the Judgment entered in accordance with the court's decision which found in favor of defendant/Appellees and against plaintiffs/Appellants, and which directed that certain bank accounts be utilized for Appellant, Joseph Wilhelm, Sr.'s maintenance and welfare. Whether any such sums are needed is to be determined by defendant, Joseph H. Wilhelm, Jr., with the consent of his siblings who are the remaining defendants.

This action was initiated by Joseph J. Wilhelm, Sr. and his wife, Leanna Wilhelm. Named as defendants were the plaintiffs' four children, and three banking institutions. Captioned as a "Petition for Injunction" it alleged that Joseph had been in possession of a large sum of money which he received from various sources during his marriage and that for the convenience of the parties he opened several bank accounts in joint names with each of the party's four children. The plaintiffs averred that all parties agreed that the money placed in the accounts did not belong to the children and that Joseph received all interest which the accounts generated. The Complaint also alleges that because of health problems Joseph turned over all his affairs to his wife as indicated by a power of attorney and that the bank refused to honor Joseph's intent to withdraw monies when the power of attorney was presented to them by Leanna. The plaintiffs further claimed that their children had refused to turn over the certificates of deposit, which the bank maintained it needed to allow plaintiffs access to the account. Averring that the funds in the accounts belonged to Joseph and Leanna, they requested the court to order their children to turn over all the certificates of deposit and other necessary documents to effectuate transfer of the funds and to order the financial institutions to turn over the funds which they are holding in Joseph's name alone or in joint accounts he had with his children. In response, the financial institutions denied that they refused to cooperate and liquidate the questioned accounts. They maintained that they informed Plaintiffs that they had to provide appropriate documentation before action could be taken on the accounts and that Plaintiffs indicated they did not have possession of the relevant items. The children also answered denying that the accounts were "convenience accounts" and alleging that Joseph made each of the children co-owners of their respective accounts with rights of survivorship. The children alleged that the plaintiffs, although married, were separated for a period in excess of ten years and that money deposited by Joseph into the accounts did not constitute marital property, rather a large bulk of money was acquired by Joseph as a result of the death of his sister. The children, as individual defendants, also alleged that their father, Joseph, due to various infirmities, became incapable of managing his own financial affairs shortly after he created the accounts. They ultimately requested that the court dismiss their parents' complaint.

A hearing was held during which each of the parties testified, along with representatives from the various financial institutions involved and doctors who examined Joseph to provide evaluations of his condition. The court also admitted deposition testimony from others who examined Joseph, a Last Will and Testament written by Joseph in 1983, in which he bequeaths all his property in equal shares to his four children without any provision for Leanna, and an Inheritance Tax Return related to the death of Joseph's sister.

Following the hearing the court made certain findings of fact. Relevant for purposes of our discussion on appeal, the court found that Joseph and Leanna had experienced marital difficulties during the 1970's and 1980's which culminated in Leanna filing a complaint in divorce. The complaint was dismissed for failure to prosecute. During that period of marital discord, the court found that Joseph created numerous joint bank accounts with his individual children, which totaled in excess of $100,000.00 as of July 1992. The court also found as a fact that there was "no evidence presented to indicate the monies creating the respective joint and survivorship accounts was marital property" and that Joseph received $48,862.84 upon the death of his sister in 1983. Based upon the reports of the expert witnesses and the court's observation of Joseph's testimony, it concluded that Joseph is "generally incapable of handling his financial affairs." Although the court made mention of the fact that Joseph "attempted" to create a general power of attorney to his wife, it made no factual finding as to whether Joseph's actions did create a valid power of attorney. The court concluded that the banking institutions acted properly in refusing the plaintiffs' requests to withdraw funds, since they were unable to produce the relevant documents. The court also concluded that the funds in the accounts are to be maintained and made available to Joseph during his lifetime "upon demonstrated need" and upon his death "the balance of any funds remaining in each account shall pass to the individual surviving joint tenants." In accordance with its findings of fact and conclusions of law, the court found in favor of all defendants and designated the plaintiff's son Joseph H. Wilhelm "to act on behalf of all said joint tenants to determine, from time to time, whether any of said funds are needed for the maintenance and care of Joseph J. Wilhelm, Sr." It is only with the "consent of all other joint tenants and/or by order of Court" that he shall disburse the sums for the benefit of Joseph.

Joseph and Leanna filed this appeal raising numerous issues, many of which overlap and concern the overall question of whether the court erred in formulating the order it entered. ¹ Because we do find irregularities in the court's procedures, error in some of its findings and conclusions of law and error in its decision to name an interested and tendentious party as the trustee of the funds, we reverse and remand this matter to the court for further proceedings.

We begin with a discussion regarding ownership of the accounts and the court's conclusion regarding to whom the funds in these accounts should pass upon Joseph's death. The law in this Commonwealth regarding joint accounts changed with the passage of Chapter 63 of the Probate, Estates and Fiduciaries Code, 20, Pa.C.S.A. §§ 6301-6306. Under Section 6303 during the lifetime of the parties, a joint account belongs to the party or parties who contributed the funds to the account, unless there is clear and convincing evidence of a different intent. Lessner v. Rubinson, 382 Pa.Super. 306, 555 A.2d 193 (1989) Proof that a different intent existed and a gift was given is the burden of the party who is claiming to have received the benefit of that gift. Such proof must be established by clear, precise, direct and convincing evidence. Id. See also In re Estate of Heske, 436 Pa.Super. 63, 647 A.2d 243 (1994). Thus, as explained in the official comment to Section 6303 there is an "assumption that a person who deposits funds in a multiple-party account normally does not intend to make an irrevocable gift of all or any part of the funds represented by the deposit." However, all sums remaining on deposit in a joint account at the death of one of the parties belongs to the surviving party, unless clear and convincing evidence of a different intent exists. 20 Pa.C.S.A. § 6304.

In this case it is clear that the monies placed in the joint accounts were deposited by Joseph. The children each testified that they did not contribute to the accounts, rather the accounts were all opened as a result of deposits made by Joseph. Further, the court did not find, nor would there be any evidence to suggest, that Joseph intended to make an inter vivos gift to his children when he opened joint accounts. As plaintiff's son testified: "It's his money.... It was to be used basically for him and--I guess just for him, no other reason." The children, when testifying advised the court that their father created the accounts as a means of keeping the money from their mother. The parties' daughter Debra testified: "He told me that he was doing it because he did not want my mother to have the money, and if she knew about the money, she would try to take his name off it." Thus, applying the law to the facts of this case, it appears certain that Joseph had a right to withdraw some or all of the amounts he deposited into the joint accounts as he wished, since he was the sole person responsible for the contributions to the accounts. Likewise, Joseph's children would be required to turn over those documents which would be necessary to effectuate the transfer.

While it can be readily determined that Joseph had the right to the funds in the accounts over his children, it cannot be said...