Recently, in the Matter of the Estate of Del Bagno, Superior Court of New Jersey, Appellate Division, Docket No. A-3789-09T2, the Court examined the interplay between New Jersey’s Multi-Party Deposit Account Act (N.J.S.A. 17:161-1 to -17) and the law of Undue Influence.
Specifically, the case deals with the shifting burden of proof in such cases. The Multi-Party Deposit Account Act provides that where two individual jointly own an account, the surviving joint account holder is assumed to be the owner of the account when the co-owner dies. The presumption can be rebutted by clear and convincing evidence of a different intent at the time the account is created. Typically, the burden to overcome this presumption is on the challenger, i.e. the person arguing that the joint account was set up for convenience.
However, where that party establishes that a confidential relationship existed between the survivor and the decedent the burden of proof shifts to the survivor to rebut a presumption of Undue Influence. In this situation, the survivor must prove that the joint designations were intended as a voluntarily gift and that the donor understood the legal effect of the transfer of assets into the joint account.