Parker v. JPMorgan Chase Bank, 95 S.W.3d 428 (Tex. App.—Houston [1st Dist.] 2002, no pet.).
Depositor opened accounts in payable on death form in favor of
Beneficiary. However, Depositor did not sign the account contracts.
After Depositor’s death, Bank paid the proceeds to the executor of
Depositor’s estate. Beneficiary brought suit against Bank asserting that
the Bank made the payments in error. The trial court granted summary
judgment in favor of Bank.
The appellate court affirmed. The court held that Depositor did not
create P.O.D. accounts because she did not sign written agreements
creating the P.O.D. feature as required by Probate Code § 439(b).
The court also rejected Beneficiary’s argument that Bank had no standing
to raise the lack of Depositor’s signature because of Probate Code § 448
which eliminates a financial institution’s protection from liability if
it receives written notice from a party able to request present payment
that withdrawals are not to be allowed. In this case, Beneficiary had no
right to request withdrawals because the account was not a valid P.O.D.
account.
Moral: The attorney should personally inspect all signature cards and
account contracts to make certain they are signed and unambiguously
create precisely the type of account the client desires.