Aurelia DeFrank died on August 18, 2009, a resident ofMercer County, New Jersey. Although decedent’s husband predeceased her, her two (2) adult children, daughters Lorraine D. Rubaltelli and  Diane C. DiDonato, survived her.  Decedent executed a will dated March 21, 2002 which was admitted to probate.

Decedent’s probate estate consisted of real property, including a residence and vacant land, bank accounts, investment accounts, and other property. The total  value of the probate estate was approx. $1,400,000. In addition to the probate assets, decedent also had non-probate assets consisting of thirteen (13) accounts created during her life to which she contributed approx. $260,000. The thirteen (13) accounts were all jointly titled in the names of decedent and her daughter Diane; daughter Lorraine was omitted. If included in the total estate assets, the non-probate assets would constitute about 16% of the total estate value. The probate estate consists of assets held in the decedent’s name alone that do not have a beneficiary designated. When the owner dies, the probate estate passes in accordance with the decedent’s will, which must be probated. Non-probate assets include assets owned jointly or that have a named beneficiary, such as a life insurance policy, IRA or joint bank account. These assets will pass in accordance with the joint ownership or beneficiary designation without the need for probate; that is, they do not pass in accordance with the decedent’s will.

A dispute developed between the daughters about ownership of the non-probate assets. As a result, a lawsuit was initiated by Lorraine who filed an Order to Show Cause seeking to compel her sister Diane, the Executor of their mother’s estate, to provide an accounting. Diane filed an Answer and provided an informal accounting. Thereafter, the parties engaged in discovery and attempted unsuccessfully to resolve the lawsuit through mediation. Defendant then filed a motion for summary judgment, seeking a ruling that the thirteen (13) joint bank accounts in the names of decedent and defendant were non-probate assets which were not part of decedent’s probate estate and that, as a result, upon decedent’s death became defendant’s sole property. In response, plaintiff cross-moved for a ruling that the accounts belonged to the estate because defendant had not rebutted the presumption of undue influence.

The trial court ruled that the thirteen (13) joint accounts would pass to defendant, the surviving joint-owner, unless the plaintiff proved either 1) that at the time she created the accounts decedent did not intend that the funds on deposit  would pass to Diane at the time of decedent’s death ; or 2) that Diane enjoyed a confidential relationship with decedent at the time the accounts were created such that the joint accounts were the result of undue influence.

Although Lorraine argued that the decedent did not understand the consequences of establishing  joint accounts and included Diane on her accounts solely for the purpose of convenience, the court ruled that the only evidence produced by Lorraine in support of these assertions were her own self-serving statements.

With regard to the claim of under influence, the court ruled that a presumption of undue influence is created if plaintiff shows, by a preponderance of the evidence, that a confidential relationship existed between defendant and the decedent at the time the joint accounts were created. However, upon analysis, the court found that the facts could not support plaintiff’s claim that defendant shared a confidential relationship with decedent when the accounts at issue were created, and that the proofs on this issue are so one-sided that Diane must prevail as a matter of law. The court ruled as sollows:

In determining whether a confidential relationship exists, courts look for evidence of greater reliance, such as delegation of financial or business decision-making, particularly where the vesting of such authority coincides with deterioration in capacity on the part of the donor. … [W]here the donor-parent remains otherwise independent of the donee-child and retains control over the jointly-titled assets, then a confidential relationship is not established. [That is the case here.]

Accordingly, the court ruled that all the accounts titled jointly in the names of decedent and defendant passed outside of probate by survivorship to defendant

The case is attached here – Matter of the Estate of Aurella DeFrank