Sister vs. sister: fight over money from mother’s house sale

Does the fact that one child holds joint ownership with a parent mean that they are to receive everything after the parent passes?
Does the fact that one child holds joint ownership with a parent mean that they are to receive everything after the parent passes? (Photo: iStock)

Many elderly parents have joint ownership of property and joint bank accounts with at least one of their children, so that if they become mentally incapacitated, they and their property will be looked after.

However, does the fact that one child holds joint ownership or a joint bank account with the parent mean that they are to receive everything after the parent passes?

That depends on the intent the elderly parent has in holding joint ownership of property or a joint bank account with one of her children according to the following Court of Appeal for British Columbia case.

An elderly woman with two daughters had a property in joint tenancy with daughter one. She also had a joint bank account with that same daughter. Daughter one decided to sell the house, which sold for $2.7 million, put all the money from the sale in the joint bank account and shortly after withdrew all the funds for personal use. Her mother was mentally incapable at the time this occurred.

The mother had made a will years ago, making her intentions clear that her property was to be divided equally between her two daughters after her death.

After the mother died, daughter two went to court to get her equal share of the estate after daughter one claimed that she had a “right of survivorship,” and her sister wasn’t entitled to any money from the sale of the house.

Right of survivorship means that if two people bought a house as joint tenants, and one person died, the remaining person who has legal title as a joint owner gets to keep the house.

The trial court did agree that daughter one had that right but that it was superseded by the intention of the mother and spelled out in her will. The court ordered that her sister get an equal share of the money.

Daughter one appealed, claiming that by withdrawing the funds from the joint bank account into her own possession she was the only owner of the money.

The appeal court disagreed and stated that, “a jointly-held legal right to withdraw funds from a joint bank account does not enable an accountholder to assume beneficial ownership of the funds on deposit by the mere act of withdrawal.”

Daughter one was ordered to pay her sister her equal share of the proceeds from the home sale.

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