The joint bank account dilemma
Question: As a single mother, I have a will that names guardians and trustees, for my child. But my bank accounts are held jointly with my mother.
If I die first, the money goes to my mother and her will leaves everything to my child also. But then does this mean that my trustees no longer have a role to play? Would my child's father be able to access the money since my mother's will does not specifically state a trustee but only the executor.
I don't want the father to have access to the money. I would prefer that the trustees invest it until my child is an adult.
Answer: This question demonstrates that the reader is aware of the importance of proper estate planning. It is commendable that she has appointed a testamentary guardian for her child. The guardian's role and responsibilities are set out in the Children (Guardianship and Custody) Act. The guardian will step into the shoes of the deceased parent and become the mother of that child with the right to act jointly with the surviving parent.
That guardian will, therefore, have a very significant role to play in raising the child, and is not limited by the provisions of either the reader's will or that of her mother. As co-parents, both the guardian and the father of the child may have access to funds which are available to care for the child, unless those funds are left to a named trustee, who is directed to hold the funds until the child reaches adulthood.
The fact that the reader and her mother are joint holders of the account raises cause for concern for the following reasons:
1. The law in relation to jointly held bank accounts can be quite problematic, as it is not always determined that the surviving owner takes the balance in the account. Legal principles such as the presumption of advancement and the intention of the parties at the time the account was established, may need to be explored in order to confirm ownership of the funds.
2. Questions may arise as to who provided the funds in the account, since the law presumes that the balance in the account revert to the provider of those funds. It may be difficult to trace the source of the funds after the death of one of two joint account holders.
3. If the reader's mother becomes the sole owner of the funds, there is no guarantee that the funds will not be exhausted before she dies. The reader's mother will be at liberty to dispose of those funds without accounting to the child.
4. Even if the reader's mother makes provision for the funds to go to her grandchild after she dies, the fact that a will only takes effect on death, means that the reader's mother could alter her will and leave no portion of those funds to the child.
Next week, we will consider some possible solutions for the reader to consider as well as other aspects of estate planning.
Sherry Ann McGregor, partner and mediator, Nunes, Scholefield, DeLeon & Co, attorneys-at-law and notaries public, 6A Holborn Road, Kingston 10. Send feedback and questions to email@example.com or firstname.lastname@example.org.