Joint Ownership And Survivorship: The Importance Of Making Your Intentions Clear

With many of us helping to care for older relatives, a joint account seems like a simple solution in order to help with weekly shopping and other tasks. Adding family members to the bank accounts of their elderly relatives is now a fairly common occurrence.

However, it's important for those putting their wills into place to make their intentions clear in relation to jointly held bank accounts, particularly in cases where family members are added simply to help out with weekly tasks, and where there might be other family members with a claim to the estate of the deceased.

Where bank accounts are held jointly between family members – such as between a husband and a wife - it is presumed that, on the death of one of the joint account holders, the entirety of the account will be inherited by the surviving joint account owner. This process is known as 'survivorship'. However, this can be challenged, particularly in cases where family members have been added to an account to help out an elderly relative with weekly tasks.

Whilst the presumption of inheritance by survivorship would still stand in cases like this, if it can be shown that the individual was merely added to the bank account for purposes of convenience and that the monies in the joint account were only input by the elderly relative, the presumption of survivorship may be challenged and/or invalidated. In those cases, the monies held in that bank account will be classed as belonging to the estate of the deceased, rather than the surviving joint account holder. Those monies would then be divided in the same manner as the rest of the deceased's estate.

The complications of joint accounts were highlighted in a recent High Court decision in Drakeford v Cotton and Stain. In this case, Mrs Stain was added as a joint account holder to the two building society accounts of her elderly mother, Mrs Cotton. The accounts contained sums in excess of £50,000 and, upon the death of Mrs Cotton, the ownership of the account and the monies contained within the account passed to Mrs Stain. Mrs Stain's sister, Mrs Drakeford, disputed this position and brought a claim against Mrs Stain. Mrs Cotton's will declared that her estate should be split equally between her three children. Therefore, if Mrs Drakeford were to be successful in her claim, she would be entitled to inherit a third of the money in the accounts.

It was eventually agreed by the parties that Mrs Stain had...