Joint signatory bank account after one signatory dies

nodiscount

Hi

What happens to a joint signatory account if one signatory does?

rpc

If it was a proper joint account (e.g. husband and wife) then it passes to the survivor outside of the estate. It belonged to both of them.

If the second signatory was for convenience, for example a child might have access to get cash for their parent or pay bills, then it goes into the estate. The money never belonged to the second signatory, they just had access to it.

securityguy

In principle, however, banks are supposed to freeze such accounts for new transactions. rpc has the legal position on the balance at the point of death right, but the mandate for the account ceases with the death of any party and therefore what should happen, ideally, is that the account is frozen (no withdrawals or payments) and the balance is then passed to whoever is entitled to it. The money belongs to the other party, but the account has ceased to have a mandate. Because of joint and several liability, responsibility for any debts incurred on the account would fall additionally onto the estate of the deceased.

In practice banks no longer freeze joint accounts on death of one party unless there are strong grounds for suspicion of potential problems, as it would have the effect of making an already traumatic experience far worse. They used to; it happened to my grandmother, for example, who was the main earner but as was common amongst people who married in the 1920s only had a joint bank account with her late husband. But now it's much less common.

But it's as well to be aware that the banks have that right, and for people to not be in a position of literally only having one, joint, bank account to buy food with.

fundamentalsofyou

interesting.

What about in the instance of an estate account?
If there is one executor named as being the only signature on an estate account holding estate funds , and there other executors who have been refused/not allowed by this executor for being added onto the estate account as signautors
, - if the first executor dies what will happen to the account? how do the other executors get added onto the account?

securityguy

"other executors who have been refused/not allowed by this executor for being added onto the estate account"

That's the problem right there. The executors should do their job and insist that they are on the account.

TBagpuss

probably you would need to produce a copy of the deceased executor's death certificate, plus evidence that you were the other executors.

You might have to wait until the executor's estate was granted probate, and then their executors would be able to access the account and either close it and pass over the proceeds or possibly add the remaining executors.

My guess is that the first might be accepted for smaller accounts and the second would be required for larger ones.

However, as securityguy says, the best thing would be to insist on being on the account in the first place.

getmore4less

Don't mix up an executors account with an account of an executor.