In re Marriage of Case, 28 S.W.3d 154 (Tex. App.—Texarkana 2000, no pet.).
Husband inherited money from his father and opened a certificate of
deposit with the funds. The CD was in the form “Husband or Wife.” Upon
divorce, Wife claimed that she was entitled to half of the CD. The trial
court agreed applying the general rule in divorce cases that when a
spouse uses separate property to acquire property during the marriage
and then takes title to that property in the names of both spouses, the
presumption arises that the purchasing spouse intended to make a gift of
one-half of the separate funds to the other spouse. Husband appealed.
The appellate court reversed. The court began by acknowledging that
normally a presumption of gift of one-half of the property would arise
when separate property is used to purchase property which is then held
in the names of both spouses. However, in this case, Probate Code § 438
provides that a joint account belongs to the parties in proportion to
the net contributions by each to the sums on deposit unless there is
clear and convincing evidence of a different intent. This statute
overrides the common law gift presumption with respect to bank accounts
such as the CD. Accordingly, the principal amount of the CD remained
Husband’s separate property.
Moral: Placing money in a joint account does not operate as a gift of
one-half of the funds to the other party to the account unless there is
clear and convincing evidence of an intent to do so.