New Jersey Appellate Division Issues Decision Clarifying Second Prong of Silver Test

The standard for entry of a Final Restraining Order (FRO) under the NJ Prevention of Domestic Violence has been long established by the Courts (and discussed many times on this blog); under the seminal case Silver v. Silver, in order to obtain an FRO, the plaintiff must have a qualifying relationship with the defendant, and also has the burden to establish that:

1. The defendant committed one or more of the predicate acts of domestic violence identified in the Prevention of Domestic Violence Act; and
2. There is a need for the protection of an FRO going forward.

In a recent published (precedential) decision, A.M.C. v. P.B., the Appellate Division addressed the second prong of that test and the misapplication of the facts to the law that led to the trial court denying the plaintiff’s request for a Final Restraining Order.  In this case, the plaintiff filed a temporary restraining order alleging that the defendant had committed the predicate acts of harassment, assault, and terroristic threats.  At trial, the Court made a factual finding that the predicate act of assault had occurred.  More specifically, the Court found that the act of assault that formed the predicate act of violence for the complaint had occurred and that the defendant had assaulted the plaintiff in an attempt to prevent her from fleeing the marital home.  Further, the trial Court found that a prior act of assault had occurred three weeks earlier.

Despite making those factual findings, the trial court denied the Final Restraining Order because it found that – in spite of two acts of assault that had occurred within a three week period – the plaintiff did not need the protection of an FRO to prevent the defendant from committing further acts of domestic violence against her.  The trial court made this finding based chiefly on 1) the fact that the defendant had not contacted the plaintiff in the 10 days between her having filed the TRO and the Final Restraining Order hearing; 2) the parties’ marriage and, indeed, relationship, was short-term; and 3) the parties did not have children together, which was seen by the court as a mitigating factor because, the judge reasoned, there was less of a likelihood of interaction between the parties since they would not have to go on to co-parent together.

The plaintiff appealed.  On appeal, the Appellate Division squarely addressed the question, “Despite finding that a defendant committed one of the predicate acts listed in N.J.S.A.2C:25-19a, when may a court properly refuse to issue restraints?”  Hearkening back to the seminal Silver case itself, the Appellate Division answered that question by holding that when the predicate acts involves a violent offense – such as assault – and the Court has found that it occurred, then “the decision to issue an FRO ‘is most often perfunctory and self-evident.'” (quoting Silver at p. 127).  The Appellate Division reversed; it found that, in determining that the plaintiff did not need the protection of an FRO going forward, the trial court had “no rational basis” for relying on the length of the marriage, the fact that the parties have no children, and the fact that the defendant had not contacted the plaintiff between when she fled the home and the day of the FRO hearing.  And this makes sense:  if it has been found that a given defendant has a propensity for physical violence against the plaintiff, this should be more persuasive than any of the facts that the trial court relied upon when it made its decision.  Just because a relationship is short-term and there are no children, or the defendant didn’t contact the plaintiff during the ten day period between issuance of a TRO and the FRO hearing, doesn’t lessen the likelihood that the defendant will target the plaintiff with physical violence again.

The takeaway?  The Appellate Division has held that, where the court finds that a predicate act of physical violence (for example, assault or sexual assault) has occurred, the fact that the act was violent in nature should be weighted heavily by the trial judge when assessing whether there is a need for the protection of the FRO going forward, and that an FRO should generally be issued in these instances.

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Jessica C. Diamond is an associate in the firm’s Family Law Practice, resident in the Morristown, NJ, office. You can reach Jessica at (973) 994.7517 or jdiamond@foxrothschild.com.

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Judge Sabatino’s Ruling That Choice of Law Decisions Can be Made Defendant-by-Defendant is Affirmed by the Supreme Court

Ginsberg v. Quest Diagnostics, Inc., ___ N.J. ____ (2016).  Last year, the Appellate Division, speaking through Judge Sabatino, issued a lengthy opinion in this choice of law case.  That decision, reported at 441 N.J. Super. 198 (App. Div. 2015), was summarized here.  The Supreme Court granted review and, in a per curiam decision, affirmed the […]

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Catching Up With Supreme Court Grants of Review

I’ve missed a lot of days in the last several weeks.  The Supreme Court, however, has been active.  The Court announced grants of review in the following cases: In Lee v. Brown, the Court granted leave to appeal.  The question presented there, as phrased by the Supreme Court Clerk’s Office, is “Was a city electrical […]

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Early Settlement Program (ESP) in Divorce Cases

Due to the inordinate time, expense, and lack of judicial resources available for divorce cases, the New Jersey Courts have implemented settlement alternatives to court proceedings.

One of these is the Early Settlement Program (ESP) which helps parties in a divorce reach a settlement in advance of a distant court date.  Represented by attorneys, the parties appear before two Panelists who are experienced matrimonial attorneys.

ESP Process

1. Prior to the ESP date, each party’s attorney will deliver to the panelists his/her client’s written settlement position related to financial issues, along with a Case Information Statement.
2. On the ESP date, the attorneys will meet with the Panelists in a conference room at the Courthouse, argue the positions, and answer any questions from the Panelists.
3. The Panelists will then discuss the case amongst themselves, arrive at a recommendation for settlement, and share that recommendation with the attorneys and the parties.

The panel result is only a recommendation and does not have to be accepted. However, because it is the opinion of two experienced matrimonial attorneys in the applicable judicial precinct, the recommendation should be carefully considered—after many more months and expense the parties could see the same result in court. Even if the parties do not accept the full recommendation of the ESP panel, they should at least view it as the basis for further negotiation on the remaining outstanding issues.

If you are considering an ESP to settle your divorce case prior to trial, you should seek out experienced legal counsel familiar with the process. You have the right to be represented by an attorney in these proceedings and it is in your best interest to do so. The issues being addressed are sensitive and complex, and they require a comprehensive knowledge and understanding of family law in order to achieve a successful outcome.

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The “Single Publication Rule” and the One-Year Statute of Limitations Bar a Defamation Case

Petro-Lubricant Testing Laboratories, Inc. v. Adelman, ___ N.J. Super. ___ (App. Div. 2016).  The “single publication rule” gives a defamation plaintiff “a single cause of action, which arises at the first publication of an alleged libel, regardless of the number of copies of the publication distributed or sold.”  Churchill v. State, 378 N.J. Super. 471 […]

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Online Postings Considered Defamation?

Complaining about an old boss online in an online forum can get you sued. Luckily the Appellate Division agreed with the Judge and dismissed it. Check out this case below.  Just be sure if you put something online, it's factual, otherwise it can get you in hot water.

Court Makes Pivotal Ruling in Defamation Suit Against Boss-Rating Site

The Sixth Anniversary of New Jersey Appellate Law Blog

Yesterday, when I was out of the office, was the sixth anniversary of this New Jersey Appellate Law blog.  I can only offer, yet again, my thanks to those jurists, attorneys, law students, and other interested persons who have subscribed to or otherwise followed this blog, and for their thoughts and comments on it. The […]

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APPELLATE DIVISION WEIGHS IN ON SAVINGS AS A COMPONENT OF AN INITIAL ALIMONY AWARD

Every family uses its money in different ways. Some families spend every cent they have on everything imaginable, others save every last possible cent for the proverbial “rainy day”, and many families fall somewhere in between. Once a marriage comes to an end, however, will both spouses be able to continue spending or saving in the same way they did during the marriage as part of the lifestyle lived?

New Jersey case law has long held that a trial court may consider a savings component as part of an alimony award to protect a dependent spouse from the potential future loss of income by allowing her to accumulate a post-Judgment safety net. One question that has never been answered until now, however, is whether a history of regular savings during the marriage as part of the marital lifestyle should be considered in setting an initial alimony award even when there is no need to protect the dependent spouse.

According to the Appellate Division in the newly published, precedential decision of Lombardi v. Lombardi, the answer is a resounding yes.

FACTS TO KNOW:

During the parties’ marriage, savings was the largest component of the parties’ lifestyle, but the trial judge rejected inclusion of a savings component when awarding alimony because the payee-wife did not need such funds to protect herself from a potential future loss of alimony. The parties jointly decided to live a comfortable lifestyle during which they saved approximately $70,000 per month, and budgeted most of the earned collective income so that the parties would have no worries about finances when paying for college and entering into retirement. In fact, the parties budgeted so efficiently that the payor-husband could retire at age 45 with an accumulation of $5 million in assets that could generate sufficient income to help fulfill the family’s lifestyle.

THE TRIAL COURT’S DECISION:

At trial, the wife indicated that she needed approximately $16,000 per month for herself and the three children to live a standard of living comparable to that lived during the marriage, exclusive of a savings component that she requested in the monthly amount of $30,000. She also sought $5,000 in monthly child support and for the husband to be responsible for all child-related supplemental expenses.

The trial judge acknowledged the existence of savings component during the marriage, but awarded a monthly permanent alimony payment of $7,600 based on a finding that the parties lived an undisputed “modest middle-class lifestyle” with a monthly budget of $14,516 (excluding savings). The $7,600 was calculated as sufficient to cover the shortfall in the wife’s budget after accounting for child support, monthly after-tax income estimated she could generate by investment of her share of equitable distribution (each party was receiving half of the roughly $5.5 million estate), and her after tax net income from part-time work.

Based on each party’s anticipated share of equitable distribution, the trial court found that each party had a significant opportunity to save and invest, even though the husband’s substantial income provided him with a far greater opportunity than the wife. Specifically, the court noted that the parties monthly average savings of approximately $87,000 was a “component of lifestyle” (whether for an early retirement or to enhance the parties’ economic security), but should be included in an alimony award “only [ ] to the extent it was necessary to ensure a dependent spouse’s economic security in the face of a later modification or cessation of support, which were not issues here.”

Even without a higher amount of alimony (inclusive of a savings component) the court noted that the wife could save (albeit at a lesser extent than that seen during the marriage) when considering:

1. some “overlap” in the presented alimony and child support budgets;
2. the wife’s right to claim the children as exemptions for tax purposes; and
3. her “ability to work and retain earnings to use for savings . . . because of the maturation of the children . . . such that she would have more time to spend working if she chose to do so.”

The court also noted the wife would have no obligation to pay for college or any unreimbursed medical expense, the cost of extracurricular activities was covered by the “above guidelines” child support award, and if she wanted to work more she would be “protected against any claim that her alimony should be reduced or that she has lesser need,” and the alimony would likely never be reduced because of the husband’s income and assets. Summarizing its determination to exclude a savings component, the court held:

The [c]ourt finds that a permissible savings component which it elected not to do or not to include was because there are potentials for [plaintiff] to accumulate, earn, and otherwise be protected from a reduction by virtue of, one, reasons having to do with the current budget and the room in the budget to still save, the ability to work more without worry about a reduction in alimony, the investment opportunity that might enhance the return on the over $2 million that she will receive, the life insurance to protect against the death of the defendant, and the likelihood of a continued appreciation and increase in assets and earnings that . . . would protect her against any arbitrary . . . reduction in alimony based upon early retirement or otherwise.

The wife’s appeal followed.

THE APPELLATE DIVISION WEIGHS IN:

On appeal, the Appellate Division agreed with the wife’s position that the subject award allowed only the husband to maintain the standard of living experienced during the marriage, and that required Case Information Statement form, on its face, suggests that a savings component is a “fundamental element of the family lifestyle” because the savings category was specifically added to the budget portion of the form after its initial issuance.

Reviewing seminal New Jersey alimony law, the Court reminded that each party is entitled post-divorce to live a lifestyle reasonably comparable to that lived during the marriage, with neither party having a greater entitlement to do so than the other (as codified in the 2014 statutory amendments to the alimony law). As a result, the alimony award designed for the supported spouse to achieve such lifestyle that is ultimately the “touchstone for the initial alimony award.”

While noting how case law has long recognized that a savings component in an alimony award can protect a dependent spouse against the potential future termination of alimony, or to provide for future events such as retirement, the Court provided:

The most “appropriate case” in which to include a savings component is where the parties’ lifestyle included regular savings. Because it is the manner in which the parties use their income that is determinative when establishing a marital lifestyle, see Weishaus, supra, 180 N.J. at 145, there is no demonstrable difference between one family’s habitual use of its income to fund savings and another family’s use of its income to regularly purchase luxury cars or enjoy extravagant vacations. The use of family income for either purpose over the course of a long-term marriage requires the court to consider how the money is spent in determining the parties’ lifestyle, regardless of whether it was saved or spent on expensive purchases. The fact that the payment of the support ultimately is protected by life insurance or other financial tools, does not make the consideration of the savings component any less appropriate.

Rejecting the husband’s argument that the court appropriately considering savings through its equitable distribution award, the Appellate Division held:

The argument runs afoul of the rule that “equitable distribution determinations are intended to be in addition to, and not as substitutes for, alimony awards,” which are awarded to provide for the maintenance of the marital lifestyle post-dissolution. Steneken, supra, 183 N.J. at 299. Moreover, it is not equitable to require plaintiff to rely solely on the assets she received through equitable distribution to support the standard of living while defendant is not confronted with the same burden. As expressed under the alimony statute’s current version, the court must recognize that “neither party ha[s] a greater entitlement to that standard of living than the other.” N.J.S.A. 2A:34-23(b)(4).

In finding that its holding went beyond what most other jurisdictions provided regarding the savings component issue, the Court concluded:

We therefore hold that the Family Part must in its assessment of a marital lifestyle give due consideration to evidence of regular savings adhered to by the parties during the marriage, even if there is no concern about protecting an alimony award from future modification or cessation upon the death of the supporting spouse.

The issue of how to treat savings as part of the marital lifestyle under the type of circumstances present in Lombardi has long been discussed amongst family law attorneys without definitive judicial guidance.  Now that such guidance is here, this may not be the last we hear from the Lombardi family as perhaps the Supremes will ultimately weigh in.

_____________________________________________________

Robert Epstein is a partner in Fox Rothschild LLP’s Family Law Practice Group and practices throughout New Jersey.  He can be reached at (973) 994-7526, or repstein@foxrothschild.com.

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Retro Alimony Reduction, Woes

Alimony is always a sticky point in a divorce. Two years ago, they amended the alimony statute to allow reduced payments based on circumstances may now allow for it to be retroactive.  This is a really big deal.  While Judge Jones has the correct understanding about the current state of the economy, lack of jobs, lack of good paying jobs, making the changes retroactively is a slippery slope.  In this case, the husband lost his high paying job, but luckily found another job but was a decrease in salary. He continued paying alimony from his severance, once that ran out he applied to the court for a reduction. This makes sense so far. Some proponents believe it should be retroactive to before the amendment was changed in 2014 which would allow the reduction of alimony he was paying from the severance. This could open a Pandora's box. When laws changed, they should not be retroactive. If someone wants to adjust their alimony, they seek the relief from that day forward, not retro.  In this particular case, the husband should have filed to have the alimony reduced once he determined he could not locate a comparable paying job.

If you are in need of a NJ Divorce lawyer, call today for your free consultation or visit the website, http://ift.tt/1Hrh0TB

We handle Divorce, separation agreements, alimony adjustments, child support issues, parenting time.  Call today, don't delay.

 

Amendments Allowing Reduced Alimony for Changed Circumstances May Be Applied Retroactively, Judge Rules

Phone and Email Scams: Is it REALLY the IRS?

Have you received a telephone call from someone claiming to be an IRS employee? This is a scam that has hit taxpayers in all 50 states. The callers tell the intended victims that they owe taxes and must pay immediately using a prepaid debit card or wire transfer. The victims are threatened with criminal charges, arrest, deportation, or loss of a driver’s license. Some of the callers can be quite aggressive and frightening.

The Treasury Inspector General for Tax Administration has received reports of approximately 736,000 contacts by scammers since October 2013. The Inspector General’s office also estimates that approximately 4,550 victims have collectively paid more than $23 million to the scammers.

What can you do to protect yourself? First of all, know that the IRS generally first contacts taxpayers by mail, not by phone. They will never ask for payment by prepaid debit card or wire transfer, and will never ask for a credit card number over the phone. If you receive one of these phone calls, just hang up (even if the caller ID appears as if it is the IRS calling – another part of the scam). As always, never, ever give out personal information to someone who has called you.

Other things to do if you receive a scam call:

1. If you do owe Federal taxes, or think you might, hang up and call the IRS at 800-829-1040. IRS employees will be able to assist you.
2. If you do not owe taxes, fill out the “IRS Impersonation scam” form on the Treasury Inspector General’s website, or call 800-366-4484.
3. You can also file a complaint with the Federal Trade Commission. Add “IRS Telephone Scam” to the comments in your complaint.

Fortunately, progress is being made to stop scamming operations. On October 6, 2016, it was reported that 200 police officers raided nine locations in Mumbai, India that were call centers for these IRS scam calls to the U.S. Seventy people have been arrested and another 630 are being investigated. Prosecution should not be difficult since the calls were recorded, and the police recovered 851 hard disks with the recordings.

Scammers are also using e-mail to find victims. On September 29, IRS issued a warning that scammers are sending a fraudulent version of IRS Form CP2000, which is sent to a taxpayer when income reported by a third-party (such as the taxpayer’s employer) does not match the income reported on the taxpayer’s return. The notice includes a payment request that the recipient mail a check made out to “I.R.S.” to the “Austin Processing Center” at a post office box address. There is also a “payment” link within the e-mail.

The CP2000 form is mailed to taxpayers through the U.S. Postal Service. The IRS does not request personal or financial information by e-mail, text, or social media. Do not open any attachments or click on any links in these e-mails. Instead, forward the e-mail to phishing@irs.gov.

Most people are nervous about a contact from the IRS, but you can protect yourself against scammers that are playing on this fear – just hang up or hit “Delete”!

Scammers often target older, retired people who are less familiar with fraudulent behaviors on the Internet or via phone calls. If you have an elderly relative or friend, you should reach out to make sure they are aware of this IRS scam. Also, if you are worried that a relative is susceptible to monetary scams due to failing health, early Alzheimer’s disease or other cognitive disabilities, you might want to get a Power of Attorney so you can proactively protect their assets.

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Assisted Suicide or Murder

I'm sure most people reading online blogs have known someone who had a terminal illness and watched them suffer until they passed. A good percentage of those around that person had concerns about their suffering and never wanted to see their loved one in pain. Unfortunately, the laws prevented aid in the form of medicine to those patients so they could die on their own terms.  I'm sure you all recall the news stories about Dr. Kevorkian how he helped terminally ill patients pass on, and because of this, was sentenced to jail as the laws did not permit this.  They still don't in New Jersey. BUT, there is a bill pending (Aid in Dying for the Terminally Ill Act, A2451) which still needs to go through the Assembly and the Senate and ultimately the Governor.  The bill has both advocates and opposition as I'm sure you can surmise.  You can read the article below to hear both sides, all which are valid. Stay tuned on this one as this is a game changer.

If you are in need of legal assistance, call Simon Law Group for a free consultation 800-709-1131. We are here to help and will be your advocates! 

If you have been injured, speak to one of our Personal Injury Lawyers 800-709-1131

Photo courtesy: (Source: MGN Online)

NJ Legislature Moves Ahead With Right-to-Die Bill

Out-of-Work Employees Can Seek Unemployment Compensation Benefits in New Jersey

An individual who is out of work in New Jersey may qualify for unemployment insurance benefits through the state government. The State of New Jersey Department of Labor and Workforce Development Unemployment Compensation Office is responsible for processing benefit requests and determining whether a former employee is eligible to receive benefits.

In order to be eligible for benefits a claimant must have worked for a specific period of time and earned a certain minimum salary, as determined by the Unemployment Compensation Law, prior to their separation from employment. The claimant’s separation from employment must have been through no fault of their own; however, there are a few exceptions to this rule. If an employee is fired for misconduct that corresponds with one of the three categories of misconduct under the law, then the claimant is not entitled to benefits. In order to maintain their eligibility for benefits a claimant must, among other things, actively seek employment and regularly claim benefits.

If the Department determines that a claimant is ineligible for unemployment benefits, then the claimant may file an appeal of the determination to the Appeal Tribunal. The claimant’s appeal will be heard at a hearing before an Appeals Examiner. Both the claimant and the former employer are permitted to participate in the hearing. Both parties are permitted to examine witnesses, and to be represented by counsel. A claimant must be well prepared with evidence and witnesses to support their claim at the hearing.

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Personal Injury - Talc Powder Cases To New Jersey

New Jersey has been chosen for the location to hear all of the suits throughout the country regarding the claims that Talk powder links to cancer.  There have been numerous suits over the years, some dismissed, many still pending and even more new ones.  Judge Wolfson in the District Court of New Jersey will hear the consolidated cases.  It is unfortunate for a lot of the plaintiffs in these cases as they are from out of state which means when it comes to testify, they will most likely need to travel to New Jersey.   The suit "seeks compensation for personal injuries or wrongful death that resulted in ovarian or uterine cancer in women who applied talcum powder to their genital area and for failure to warn of the risk of cancer."  Talc powder has been used for years by families from women to babies.  It will be interesting to see how these cases play out. This will most definitely take a while to see out. Stay tuned.

If you believe you have fell victim to a product and feel others as well, contact Simon Law Group, personal injury firm for a free consultation to find out if you have a case.  No cost to you.

Call 800-709-1131 or visit the personal injury page and complete the form on the bottom of the page. Link

Suits Linking Talc to Cancer Consolidated in NJ Federal Court

The Timing of Your Divorce Could Impact Your Social Security Benefit

The Social Security system permits a divorced person who is eligible for social security benefits to receive the greater of (a) a calculation based on 100% of his/her earned benefit amount, or (b) provided the parties were married for at least ten years, the claimant has not remarried, and the spouse is at least 62 years old, a calculation based on 50% of his/her ex-spouse’s earned benefit amount. This award does not negatively affect the ex-spouse—he/she will still collect 100% of his/her earned benefit.

New Jersey law generally holds that the marital partnership terminates upon a filing for divorce; however, the parties do in fact remain legally married until the subsequent entry of a Judgment of Divorce. For Social Security purposes the latter rule applies—the date of the judgement will be used to calculate benefit awards and adjustments.

What if, for example, a person has been married for 9 years when a divorce complaint is filed? If the divorce judgement issues six months later, neither marital partner can claim the 50% ex-spouse social security benefit because the length of the marriage will be 9.5 years—6 months short of eligibility. In the same way, if a complaint is filed after 9 ½ years with the final judgement issuing 6 months later (to make it 10 years of marriage), either party (if eligible for social security) can apply for the 50% ex-spouse benefit.

Under this social security model a person who would obtain a higher social security benefit using the 50% ex-spouse rule would be wise to delay the entry of a Judgment of Divorce until a full 10 years has passed.

Timing of divorce and approaches to divorce and division of assets can become very complicated. It is important to consult a divorce attorney who is experienced in divorce law and who understands how divorce can affect your income and benefits options for the long term—including those related to income generation after retirement.

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1 N.J. 1 (1948)

Have you ever wondered about the very first opinion ever to appear in New Jersey Reports?  If not (and it’s certainly more than understandable if you have not expended time thinking about that), today is the day to do so, since it was on October 11, 1948 that the Supreme Court issued its decision in […]

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Appellate Division Statistics, 2015-16

At last week’s NJSBA Appellate Practice Committee meeting, which featured a talk about ethics in appellate practice, statistics for the 2015-16 Appellate Division term were presented.  Those statistics are generally similar from term to term, as can be seen (for example) here.  The just-concluded term continues that pattern. The Appellate Division added a total of […]

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New Jersey Estate Tax Repeal

On Friday, September 30, 2016, New Jersey lawmakers held a press conference announcing significant changes affecting the New Jersey Estate Tax. The video and transcript of the conference can be accessed by clicking here.

The New Jersey Estate Tax applies to the estates of New Jersey residents and currently has an exemption of only $675,000. Under the proposal, the New Jersey Estate Tax exemption will be increased to $2.0 million per person on January 1, 2017; and effective January 1, 2018, the New Jersey Estate Tax will be eliminated entirely.

The Governor did not mention the New Jersey Inheritance Tax, which is a separate tax on non-lineal (i.e. beneficiaries who are not a spouse, child, or more remote issue etc.) heirs. Therefore, it is not known if the New Jersey Inheritance Tax will also be affected.

The proposal also included increases in the New Jersey gross income tax exclusions on pension and retirement income to: (i) $100,000 for joint filers, (ii) $75,000 for individuals, and (iii) $50,000 for those who are married filing separately. The higher exemptions would be phased in over four years under the current proposal.

We understand that a vote has been delayed. It is also possible that the final legislation will differ from the outline presented on September 30th. We will continue to monitor the status of the proposal, and any changes from what is being currently discussed. If passed, these changes would be a substantial modification in New Jersey estate taxation and we strongly encourage you to review your estate planning document with any new legislation in mind.

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The Multi-Party Joint Deposit Account Act

In general, the funds within a joint account belong to the account holders and all account holders have the right to the entirety of the account. Should one of the joint account holders pass away, it is generally accepted law that the account would then pass to the surviving account holder(s). Under the Multi-Party Joint Deposit Account Act, this is typically what occurs should an account holder pass away; however, there are exceptions to this general rule of law.

Typically, the sums remaining in a joint account pass to the surviving joint account holder(s). Under the Multi-Party Joint Deposit Account Act, however, there are some exceptions which have appeared within the relevant case law, as well as annotations to the statute itself. For example, if the account was established by the Decedent solely for the purpose of convenience to allow another party to write checks on their behalf or, under circumstances which indicate that there was never a clear intent for the surviving account holder to keep the proceeds of the account, the Court may find that the account actually belongs to the Estate of the Decedent instead of the surviving party. This could be demonstrated by documents and/or testimony which evidence that it was the Decedent’s intent for the account to pass to his Estate and not solely to the surviving party.

The proceeds in a joint account may also pass to the Decedent’s Estate and not to the surviving member if it is shown that the surviving member was in a confidential relationship with the Decedent at the time the account was created. In such instances, the burden of proof would be then shifted to the surviving account holder to demonstrate by clear and convincing evidence that the decedent intended them to be the beneficiary of the account upon death. In such a scenario, the surviving joint account holder would have to meet a very high burden of proof in demonstrating that the decedent intended for them to receive the proceeds upon death, or the account will revert to the decedent’s estate. If no confidential relationship existed, then it is the contesting party’s burden of proof to demonstrate that the account should pass outside of the Multi-Party Joint Deposit Account Act to the decedent’s estate if they can show that the account was for convenience, as set forth above, or if there were suspicious circumstances surrounding the designation as a joint account.

In the context of litigation, challenging a joint account designation can be tricky and is very similar to a Will contest. Regardless, these joint accounts can also be very substantial in nature, and at times, can be the main or sole asset of the Estate. As such, it is strongly suggested that a party consult with an attorney in order to discuss the best possible way to either defend a joint account designation, and/or to prosecute an action to invalidate same. The attorneys at Stark & Stark are well versed in this area of law.

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A New Third Circuit Chief Judge

As of October 1, Judge Smith has succeeded Judge McKee as Chief Judge of the Third Circuit Court of Appeals.  Judge McKee has been Chief Judge since 2010, succeeding Judge Scirica in that role.  Judge McKee is thus, to date, the only Third Circuit Chief Judge that this blog has ever known. The new Chief Judge, Judge Smith, is […]

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