Matter of Dudley
Annotate this CaseDecided on October 25, 2006
Surrogate's Court, Chautauqua County
In the Matter of the Proceeding by James A. Sommer Executor of the Last Will and Testament of Carol G. Dudley, Deceased, Petitioner to Discover Property Withheld by Eugene Brushaber, Respondent
96-0186
ALAN BOZER, ESQ.
3400 HSBC Center
Buffalo, New York 14203
For the Petitioner
CHARLES EDWARD FAGAN, ESQ.
P. O. Box 1382
Jamestown, New York 14702
For the Defendant
Larry M. Himelein, J.
The primary issue in this case is whether a bank account titled to decedent Carol Dudley and Eugene Brushaber passed to Brushaber when Mrs. Dudley died or instead was a convenience account that belongs to Mrs. Dudley's estate. A secondary issue is whether this determination can be made as a matter of law or if a trial is required.
James Sommer was the attorney for Carol Dudley and her late husband Stewart, who died in 1985. On October 14, 1998, Sommer was appointed power of attorney for Carol Dudley. In early January 2005, Sommer received a call from Eugene Brushaber, who is married to a niece of Stewart Dudley. Brushaber advised that Mrs. Dudley was dying and Brushaber wanted money to pre-pay the funeral bill and other expenses for her.
Sommer agreed to set up an account but was unable to handle the transaction personally because his wife was terminally ill. R. Timothy Eades, another attorney in Sommer's firm, went [*2]to the bank with Brushaber on January 7, 2005 and spoke with Arthur Holzerland, a bank employee. Eades, per his instructions from Sommer, asked to open a convenience account for Mrs. Dudley. Eades was told that the bank would not open that type of account but would instead open a joint account. While at the bank, Brushaber signed a signature card with language identifying the account as joint with the right of survivorship. Eades then took the card to Sommer for his signature and returned the card to the bank. Sommer's wife died later that day.
The account was opened with $25,000.00. Other money was deposited on January 10, 2005. On January 13, 2005, Mrs. Dudley died. A number of estate bills were paid from this account but on May 18, 2005, the account was closed. Brushaber refused to return the money to the estate and the estate commenced this proceeding to recover the money as an estate asset.
The estate has now moved for summary judgment. In support of the motion, Sommer avers that the account was intended to be a convenience account out of which Brushaber could pay Mrs. Dudley's expenses. Further, he never intended to make a gift of the account to Brushaber and his power of attorney would not have allowed him to make a gift of that amount. Mr. Eades' affidavit also states that the account was intended for convenience only but the bank would not set up such an account.
Brushaber has cross-moved for summary judgment holding the account to be joint with the right of survivorship. Brushaber, in a scorched-earth approach, also moves to declare Sommer to be incompetent to serve as executor, moves to disqualify the law firm representing the estate, and moves for several other forms of relief.
Much of the evidence is uncontroverted. Sommer and Eades both contend that the account was intended to be for convenience only. Brushaber contends that Eades' affidavit should not be considered since he has not been deposed. The court is unaware of any rule to that effect and notes that nothing in Eades' affidavit has been controverted.
At his deposition, Brushaber said the account was opened so he could pay Mrs. Dudley's bills. He also said that Mrs. Dudley was so close to death she could not write her own checks and that Mrs. Dudley herself did not ask to have the account opened. Further, Brushaber did not know what type of account was opened or what a convenience account was but knew he could pay Mrs. Dudley's bills out of the account. His attorney did not allow him to answer questions about paying bills after Mrs. Dudley died. Brushaber also admitted he took checks written to Mrs. Dudley and deposited them into the account even after she died. After leaving the deposition to speak with his attorney, Brushaber returned and said he thought the account was a joint account. In an affidavit he submitted in opposition to the estate's summary judgment motion, Brushaber also claims it was a joint account and that the account became his after Mrs. Dudley died.
Because the account was established in compliance with § 675 of the Banking Law, the account is presumptively a joint account with the right of survivorship (see Estate of Johnson, 7 AD3d 959, 777 NYS2d 212 [3d Dept 2004]; Matter of Stalter, 270 AD2d 594, 703 NYS2d 600 [3d Dept 2000], lv denied 95 NY2d 760, 714 NYS2d 710 [2000]). However, the presumption is not conclusive and may be rebutted by a showing that the depositor established the account for convenience only and without an intent to confer survivorship rights (Id., see also Matter of Matsis, 274 AD2d 431, 711 NYS2d 764 [2d Dept 2000]).
In most cases the decedent is involved in creating the account and is unavailable to testify [*3]as to her intention. Here, however, the account was set up, not by the decedent, but by the decedent's power of attorney, who testified unequivocally that this account was intended to be strictly a convenience account. That testimony alone is sufficient to overcome the presumption of a joint account with the right of survivorship and summary judgment can be granted to the estate on that basis alone.
Even were that not the case, the estate is still entitled to summary judgment (see Estate of Boyd, 186 AD2d 394, 588 NYS2d 188 [1st Dept 1992]). Both Sommer and Eades testified that the account was intended to be a convenience account. The only reason the account was not titled a convenience account was because the bank would not set up the account that way. In addition, all the money that went into the account came from decedent. Further, the power of attorney that Mrs. Dudley signed did not authorize Sommer to make a gift of the account to Brushaber, a fact that, standing alone, would also warrant summary judgment for the estate. Finally, Brushaber's own testimony makes it clear that this was a convenience account so that he could pay Mrs. Dudley's bills.
There is no real evidence to the contrary. Brushaber's rewording of his answers after being horseshedded by his attorney cannot be taken seriously and contradicts his previous testimony. Further, a party's affidavit that contradicts his previous testimony cannot be used to create a question of fact (see Richter v. Collier, 5 AD3d 1003, 773 NYS2d 645 [4th Dept 2004]; Martin v. Savage, 299 AD2d 903, 750 NYS2d 684 [4th Dept 2004]). Finally, the decedent had no idea what was going on. Brushaber asked for an account to be opened so he could pay Mrs. Dudley's bills, and the account was opened with Mrs. Dudley's money and without her knowledge. If Brushaber believes he became the owner of the account when Mrs. Dudley died, he will have to make that argument to a higher court than this one.
Accordingly, the estate's motion for summary judgment is granted and the cross-motion for summary judgment is in all respects denied. Brushaber's other motions are also denied and Brushaber is directed to return the money to the estate with interest at the statutory rate from the date the account was closed. He is also directed to return the refund from the funeral bill, with interest from the date the check was received. The estate is also awarded costs and disbursements, without prejudice to the estate's right to seek to surcharge Brushaber for counsel fees relating to the estate's efforts to have the money in the account returned to the estate.
Submit order on notice.
Dated: Little Valley, New York
October 25, 2006
_________________________
HON. LARRY M. HIMELEIN
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