IN MATTER OF ESTATE OF GLINN, 53602-8-I (Wash.App. 7-5-2005)

APPELWICK, J.

Appellant Gail Markham is the surviving depositor on several joint accounts with right of survivorship held with the decedent Doris Glinn. She was also one of the personal representatives appointed under Doris's will. Wallace Glinn Sr. individually and as co-representative of the Estate and three other beneficiaries (the Estate) challenged Gail's inventory that showed approximately $5,500 of net estate assets and $315,000 of non-probate assets that would pass to Gail directly as a result of the survivorship provisions on the accounts. The trial court heard testimony from all parties and ruled that the Estate had shown, by clear, cogent, and convincing evidence, that Doris's intent was to have the assets distributed under her will and not by the survivorship provisions of the joint accounts, thus meeting their statutory burden of proof. Gail appeals. We find that substantial evidence supports the trial court's findings and affirm.

FACTS

Doris and Jasper Glinn were married for over 60 years when Jasper died in 1995. They had no children. Jasper had handled most of the couples' financial matters prior to his death. In addition, Doris had never driven a vehicle, and was dependent on Jasper for transportation. When Jasper's health started to fail and after Jasper died, Wallace Glinn, Sr. (Wally) undertook assisting Doris. He took her to the grocery store, to doctors' appointments, and to the bank. Doris would routinely go to the bank when one of her certificates of deposit (CDs) matured, place the interest in her checking account, and renew the CD. These accounts were in her name alone. On one trip to the bank, Wally learned that he was Doris's attorney-in-fact through a power of attorney Doris had signed.

A couple of weeks after Jasper's death, Wally drove Doris to attorney Jeremiah McCormick so that Doris could create a will. Doris's January 10, 1996 will made a $5,000 gift to William Guy, her nephew. The remainder of her estate was split equally between Gail, Linda Speed, Wally, Lori Hayes and Wallace Glinn Jr. (Lee). These are the parties to the appeal at hand. The will nominated Gail and Wally to act as co-executors.

In November 1996, Wally moved to Arizona. Doris was anxious and shocked by this, since Wally usually assisted her, but did not express hostility toward Wally for moving. Wally said it was up to Doris to arrange assistance from Gail after he left, and he assumed Doris did so "because there wasn't anybody else." Doris continued to live in her own home. Gail became more involved in Doris's care, assisting Doris with personal and banking matters. During one trip to the bank, Gail learned that she was also appointed as Doris's attorney-in-fact, together with Wally. In early 1997, Doris signed signature cards at Key Bank and Washington Federal giving Gail access to Doris's accounts. The signature cards indicated Gail was a joint account holder with right of survivorship.

In 1998, Doris fell and was injured in her home. Gail used her power of attorney to secure a place for Doris at Windsor Point, an assisted living facility. This is the only time Gail used the power of attorney; there is no other evidence in the record showing Gail used the power of attorney for any other purpose. Gail helped Doris move in. Although Doris was living at Windsor Point, she was reluctant to sell her home to which she had emotional ties. Gail called Wally and asked him to help convince Doris to sell the home. Wally agreed and spoke to Doris about selling the home.

Gail located a buyer for Doris's home and it was sold in December 1999. The sale proceeds were placed in Doris's Key Bank account, which had been changed in January 1997 into an account with survivorship provisions in favor of Gail. The record contains only a letter from the escrow company to Doris informing Doris that the funds were deposited in the Key Bank account. The record does not indicate who directed the deposit to the Key Bank account. A few months later, Gail purchased two CDs totaling $160,000 from these proceeds. These CDs, like the funds that created them, were held jointly by Doris and Gail with right of survivorship. Gail alone signed the paperwork to create the CDs.

The Estate argues that as an attorney in fact and a fiduciary, Gail was not authorized to make or create any joint survivorship account. Under RCW 11.94.050, an attorney in fact cannot "make, amend, alter, or revoke any . . . designation of persons as joint tenants with right of survivorship." Here, the funds in all of the CD accounts Gail renewed or created retained the same ownership interest before and after renewal or creation of the accounts. Gail did not change the character of the funds after Doris made Gail a joint account holder with survivorship. Thus, Gail did not "make, amend, alter, or revoke" the survivorship interest that Doris created and therefore Gail did not violate RCW 11.94.050. There is no indication of wrongdoing by Gail in converting funds into CDs or renewing CDs in this case.

Doris died on November 2, 2001. By that time, almost her entire estate was held in joint accounts with Gail. Wally declined to act as personal representative, and Gail was appointed. She filled out an estate inventory, noting estate assets and liabilities. Among the liabilities was the $5,000 testamentary gift to William Guy. Gail also noted that approximately $316,000 of Doris's funds would pass to Gail outside probate through the survivorship provisions of the bank accounts.

Wally, Linda Speed, Lee, and Lori Hayes (the Estate) challenged the inventory and the validity of the survivorship provisions. The trial court heard testimony from the Estate as well as from Gail. The trial court found that the Estate had met its burden of proving by clear, cogent, and convincing evidence that Doris did not intend to leave almost all her assets to Gail by operation of the survivorship provisions. The trial court found that Doris instead intended to split the funds among the legatees according to her will. The trial court removed Gail as personal representative, appointed Wally, and awarded attorney's fees to the Estate assessed against Gail personally.

Gail appeals the trial court's findings, arguing that the trial court erred because there was insufficient evidence under the clear, cogent, and convincing standard to rule in favor of the Estate. Gail claims that the trial court instead improperly placed the burden of proof on her and impermissibly drew inferences against her. Gail also claims the trial court erred in removing her as personal representative.

ANALYSIS

I. Substantial Evidence Supports the Trial Court's Factual Findings

Under RCW 30.22.100(3), "[f]unds belonging to a deceased depositor which remain on deposit in a joint account with right of survivorship belong to the surviving depositors unless there is clear and convincing evidence of a contrary intent at the time the account was created." Under the clear and convincing evidence standard, the ultimate fact issue must be shown to be "highly probable." In the Matter of the Welfare of Sego, 82 Wn.2d 736, 739, 513 P.2d 831 (1973). The two elements of the burden of proof are the burden of production, or the amount of evidence that needs to be submitted, and the burden of persuasion, or the need to persuade the trier of fact that the fact in issue is highly probable. State Farm Fire Cas. Co. v. Huynh, 92 Wn. App. 454, 465, 962 P.2d 854 (1998). On appeal, this court must determine whether, under the highly probable test, substantial evidence supports the trial court's factual findings. Sego, 82 Wn.2d at 739. Weighing of evidence and considerations of credibility, on the other hand, are matters for the trial court, which had the witnesses before it and was able to observe them and their demeanor on the stand. Sego, 82 Wn.2d at 740.

In order to prevail and defeat the survivorship provisions of the joint accounts, therefore, the Estate has the burden of coming forth with clear, cogent, and convincing evidence that Doris's intent at the time she created the joint accounts was not to entitle Gail to inherit those funds upon Doris's death. This requires both showing an adequate quantum of proof as to Doris's intent, and persuading the trier of fact. As the trier of fact, the trial court was persuaded; thus, the burden of persuasion has been met. This court's role is to determine whether there was substantial evidence presented to support the trial court's findings.

In order to meet its burden of production, the Estate presented evidence of Doris's estate plan. Doris's will, created after Jasper died and only a year before Gail was made a joint holder on the accounts, set out this plan. Doris did not amend her will after it was signed on January 10, 1996. In her will Doris made a small bequest to one individual, William Guy, and divided the remainder of the approximately $325,000 value of her estate between five other legatees — the four respondents who comprise the Estate and Gail. Testimony at trial showed that Doris disapproved of William Guy's lifestyle, because he

did quite a bit of drugs, got in quite a bit of trouble, and . . . stole Uncle Jasper's gun. It was so bad that [Linda Speed's] mom and dad had to chain their cars together because he would take their cars.

From this testimony, it is reasonable to infer that by limiting the bequest to $5,000, Doris intended to minimize William Guy's inheritance.

The Estate presented evidence that the relationship between Doris and the Estate parties had not deteriorated after the will was created. Each of the legatees testified that his or her relationship with Doris remained about the same before and after the creation of the will. There was no indication of a break in positive relations with or estrangement from Doris. The trial court noted that there was no evidence that Doris had become alienated from these relatives or had come to favor Gail above the other relatives before she created the survivorship accounts. Therefore, the Estate's evidence showed no reason why Doris's intent would have changed at the time the survivorship accounts were created.

Giving effect to the survivorship provision would significantly disrupt Doris's estate plan. First, William Guy, who was to receive a token $5,000 inheritance, would receive more than any of the five remaindermen under the will. And Gail, who was to receive an equal share of the remainder, would instead receive effectively all of Doris's assets, approximately $315,000, and the remaining legatees would each receive about $1,100. The Estate demonstrated a recently established estate plan, continuing relationships with beneficiaries under that plan, an absence of evidence that Doris intended to change her estate plan, and that the survivorship provisions of the joint accounts were inconsistent with Doris's estate plan.

Under Gail's inventory, the net assets of the estate after satisfying the bequest to Guy would be approximately $5,500. Each of the five remaindermen (including Gail) would share this amount and receive approximately $1,100.

Further, the Estate presented evidence that had Doris wished to change her estate plan, she was able to do so. First, she created her will just after Jasper died. She kept it by her telephone, and she never changed it. The trial court noted that there was no evidence she consulted with counsel about changing her will. Second, after the sale of the home and at the time when Gail created the $60,000 and $100,000 CDs, Doris was still able to prepare and sign checks to her creditors. There is no evidence or claim that Doris was not of sound mind up until her death. Therefore, she was able to change her will if had she wished.

Gail claims that by relying on a lack of evidence showing a change in Doris's intent, the trial court reversed the statutory burden placed on the Estate and effectively placed the burden on Gail to prove that Doris's intent, had, in fact, changed. This is not correct. By itself, the fact that Doris signed the account cards that described the accounts as joint with right of survivorship does not prove Doris's intent was to dispose of her assets primarily through survivorship provisions. It does, however, create a presumption of survivorship intent. By giving Gail the benefit of the statutory presumption, the trial court assumed the survivorship interests were created and imposed the statutory burden of proof on the Estate. The Estate met its burden of showing that Doris's intent had not changed by providing a sufficient quantum of evidence that the relationships between Doris and the legatees remained intact and that Doris's estate plan, set up only a year prior to the creation of the survivorship interest, would be significantly altered by validating the survivorship provisions. Thus, the Estate showed that Doris had a different intent than to effect the survivorship provisions — namely, the intent expressed in her will. The court correctly observed that the evidence regarding intent was not controverted except by the existence of the bank account signature cards at issue. Had Gail presented evidence that Doris showed a different intent, this would have lowered the quantum of evidence provided by the Estate and perhaps reduced it below the required amount for clear, cogent, and convincing proof. Thus, Gail was not required to present any evidence, but once the Estate met its burden of production, Gail could have rebutted the Estate's evidence by producing some contrary evidence of Doris's intent.

The court then found that the Estate had met its burden of showing that the intent to distribute under the will had not changed, and that the intent purportedly shown by creating the joint accounts conflicted with the intent under the will. Although, as Gail argues, RCW 30.22.100(3) creates a presumption that the bank instruments themselves are sufficient, absent other clear and convincing evidence, to conclusively establish the intent that the funds should go to the surviving joint tenant, such clear and convincing evidence was presented here. The trial court was persuaded, and the evidence is sufficient to uphold the trial court's findings. Thus, in this case the bank instruments alone are insufficient to control regarding the intent of the account holder.

Gail could have shown Doris's intent in signing the card by providing evidence that Doris chose among a list of options to specifically provide for survivorship. Gail offered no evidence that Doris understood the meaning of a survivorship provision. Or, as the trial court noted, Doris could have made a declaration at the time, as did the deceased in In the Matter of the Estate of Fox, 51 Wn. App. 498, 754 P.2d 690 (1988), that she wanted to establish the accounts so that Gail would benefit upon her death. The trial court did not put a burden on Gail to present this evidence, or the testimony of a bank employee, or any other evidence, as Gail claims. Nor do we. Rather, we observe that had she done so, she might have rebutted the clear and convincing evidence presented by the Estate. The lack of evidence does not prove the Estate's case but likewise does not challenge the Estate's evidence.

Gail argues that the trial court overlooked the presumption that testators know the law, and therefore improperly failed to presume that Doris knew the effect of the survivorship provisions. Gail also argues that the trial court improperly implied that Doris, by virtue of her age, was somehow incapable of understanding the consequences of her actions. However, the trial court applied the statutory presumption in favor of the joint account and put the Estate to the statutory burden of rebutting that presumption. The trial court decided that the Estate showed clear and convincing evidence of a contrary intent to having her assets pass by survivorship. This was the burden on the Estate, and the Estate met the burden. The evidence supports this conclusion.

Gail points to many instances during the last five years of Doris's life where Gail assumed the role "that would ordinarily be played by a devoted daughter." The Estate does not dispute Gail's acts. No party denies that Gail was very helpful to Doris in her last years. In fact, the court noted that Gail's role was a considerable burden for her, since she lived some distance from Doris. Further, there is no indication in the record that Gail exerted undue influence on Doris or that she otherwise pressured Doris into any decision not in Doris's best interest.

But the burden of assisting Doris that Gail undertook does not measure the affection of Doris for Gail or the other legatees. The trial judge found no evidence that Doris had come to favor Gail over the other legatees prior to creating the joint accounts. The trial judge noted that had Doris created the survivorship interest after she had become increasingly dependent on Gail, it would have been more suggestive that Doris intended to leave virtually all her assets to Gail. On the contrary, there is sufficient evidence that Doris's relationship with all beneficiaries was unchanged and that Doris's intent to distribute her assets according to her will was unchanged. This evidence does not disparage Gail's role in assisting Doris. It merely suggests Gail did not displace the other beneficiaries in Doris's view of their importance to her. Doris alone had the power to decide how to distribute her assets on her death. As the trial court noted, its role is "not to decide what is fair and just" but to determine and enforce Doris's intent.

In sum, the trial court considered the evidence in favor of the Estate, and the lack of evidence in favor of Gail, to determine that the burden of production was met. We find that the trial court's factual findings are supported by substantial evidence. Therefore, the Estate met its burden of production. Because the trial court as the trier of fact was persuaded by the Estate's evidence, the Estate also met its burden of persuasion. Therefore the trial court did not err in finding that Doris's intent when she changed the signature cards on the accounts was not to effectively revoke the intent she expressed in her will — that her estate be divided among the five remaindermen. Its conclusion that the accounts are the property of the Estate is supported by these findings, and we affirm.

II. Trial Court Did Not Err in Removing Gail As Personal Representative

Gail argues that the trial court erred in having her removed as personal representative. The trial court ruled that, based on its findings and conclusions, "to facilitate the prompt, efficient, just, and speedy administration of this estate, an order should be entered removing Gail Markham as Personal Representative of the estate." Under RCW 11.28.250, a personal representative may be removed for an enumerated reason "or for any other cause or reason which to the court appears necessary." Given Gail's claim that Doris's estate has essentially no assets by virtue of the survivorship designation in favor of Gail, Gail's interest is in direct conflict with the interests of the other beneficiaries under the will. The trial court acted within its broad power to remove Gail as personal representative. See RCW 11.96.020 (intent of the legislature is to give the courts "full and ample power and authority" to administer estates "in any manner and way that to the court seems right and proper").

III. The Estate Is Awarded Attorney's Fees on Appeal

The Estate seeks attorney fees on appeal under RCW 11.96A.150(1) and RCW 11.76.070. These statutes are an appropriate basis under which to award fees on appeal. RCW 11.96A.150(1) authorizes an award of attorney fees and costs to a party from any party, from assets of the estate, or from nonprobate assets that are the subject of the proceedings. RCW 11.76.070 allows an award of costs and attorney fees against a personal representative if an account rendered by the personal representative is erroneous. We award fees to the Estate as the prevailing party. These fees are to be assessed against Gail personally, and not against estate assets.

We affirm.