Bank Account in joint names
Querist :
Anonymous
(Querist) 18 November 2010
This query is : Resolved
There is a joint bank account in the names of X and Y, not related to each other, and the operation powers are only with X. i.e. the bank account is not as 'either or survivor' nor as 'former or survivor' and it only states that operation by 'first' i.e. by X only. The bank had accepted such operation instructions. Y had no power of operation at all.Neither Y had any cheque book nor had deposited any amount in that account. Now X had died leaving substantial amount in that account and legal heirs P and R, but X had not made any nomination or any will. Now the query is
(1) Whether Y, the mere joint holder without power of operation, gets any right in the amount in such joint account?
(2) Whether Bank owes any liability towards Y who is not related to deceased X and when Y had no power of operation?
(3) Whether any decided case law on this point?
adv. rajeev ( rajoo )
(Expert) 19 November 2010
x's legal heirs will be entitled to claim the benefits of the deceased X.
Advocate. Arunagiri
(Expert) 19 November 2010
Since it is a joint account, As X is no more, automatically Y will become the owner of the account. The operating instruction clearly says First. While X and Y are survivors, X is the First. But, now X is no more, Y moves in the que and becomes First and is entitled to operate the account.
Parthasarathi Loganathan
(Expert) 19 November 2010
The account opening procedure appears to be faulty. It appears that the account is assigned with Joint status only for operational purpose without assigning any status to the other account holder. Hence it is a case for dispute. However, Rajoo's opinion is legally tenable.
Advocate. Arunagiri
(Expert) 19 November 2010
If X's legal heir are eligible for a claim, what will be the status of Y and his legal heir on the said account. What can be shares between them?
When there is a operational instruction it prevails it over rules the rights of the legal heirs.
s.subramanian
(Expert) 19 November 2010
The operating instruction as first clearly indicates that it is a former or survivor account. In former or survivor accounts the first account holder or the former alone operates the account. That does not mean that the survivor has no interest. In the event of death of x it is the survivor who is entitled to the proceeds in the account. The survivor is in the status of a legatee of the former for the purposes of law.
Querist :
Anonymous
(Querist) 19 November 2010
All these experts have gives evasive replies without reading the querry fully. Nobody has replied fully and properly.
s.subramanian
(Expert) 20 November 2010
I am sorry that you are not satisfied with my reply. Kindly go through my reply once again and if any further details are required kindly seek them . I shall be happy to reply once again.
Parthasarathi Loganathan
(Expert) 20 November 2010
Let me give pointed reply to the query.
1. Yes in case of Joint accounts under E or S and F or S categories or Jointly operated accounts.
2. Bank definitely owes liability towards Y irrespective of the fact that the latter is not related to deceased X or had no power of operation. It depends on the mandate received by the bank and the nomination papers executed by the account holder.
3. Case laws need to be checked up. I will revert to the same.
Querist :
Anonymous
(Querist) 20 November 2010
Thanks Mr Subramaniam. But (1)How can the operating instruction as 'first' would indicates that it is a 'former or survivor' account, when in the instruction to the bank, the mention of 'survivor' was not at all mentioned and when the deposit was made by X only and not by Y?
(2)Why the legal heirs of X will not be entitled?
(3)Why the survivor Y should be in the status of a legatee of the former X and why not the legal heirs of X?
I will request you to please quote particular provisions of the specified Act and decided cases if any.
Querist :
Anonymous
(Querist) 20 November 2010
Thanks Mr Parthsarthi Loganathan.But
1. As presumed by you it was not at all 'E or S' or 'F or S' categories and not Jointly operated account. It was operated by X alone. The bank had accepted such instructions.
2. Why the Bank should owe any liability towards Y when he had no power of operation and when he had not deposited any amount there?
3. When the mandate received by the bank was X alone and when the nomination papers were not executed by X, why the legal heirs of X will not be entitled?
I will request you to please quote particular provisions of the specified Act and decided cases if any.
R.Ramachandran
(Expert) 20 November 2010
Dear Anonymous,
No one in this Forum is holding any brief either for the bank or for Y or against any of the legal heirs of X.
What Mr. Partha has stated was the normal rules and procedure.
Really the situation which you are explaining that Bank has accepted that only X has been mandated to operate the account with Y except lending his name to be in the account has no role whatsoever to play.
It is an highly peculiar situation.
I have not come across any case law on similar such fact situations.
Therefore it would be advisable for you to approach a lawyer and to file appropriate case against the bank to press your points.
Parthasarathi Loganathan
(Expert) 20 November 2010
I maintain status quo on my original opinion dated 20.11.2010 as the account opening procedure itself appears to be faulty and the concerned bank officers will have to face the music. Court will surely fix onus of responsibility on the bank to settle the matter.
Khaleel Ahmed
(Expert) 25 November 2010
Where as the bank account jointly opened by x and y. The operational authority kept by x. x died without any nominee.
In my opinion the deposits in the joint account absolutely belongs to x and y equally. Y and x's legal heirs can claim the amount deposted in the bank according to their proportions.
Advocate. Arunagiri
(Expert) 25 November 2010
When it comes the joint account, if the person who is having the authority to operate is no more, the survivor alone is having the right over the account. If the bank is not allowing the survivor to operate what is the locus standi of the Y.
Arun Kumar Bhagat
(Expert) 27 November 2010
I fully support the views of Mr. Arunagiri.
