Exceptions have been filed by the Commonwealth to our adjudication dated September 10, 1974, of the first and final account of the executor of this estate. In the adjudication, we disposed of an inheritance tax appeal filed by the executor, relating to the taxability of a joint savings account in the Savings Fund Society of German-town, held at the time of decedent’s death in the names of Lois H. Brownback and decedent. We sustained the appeal and set aside the assessment of inheritance tax on one-half the balance in the account.
The exceptions allege that we erred in our factual findings that, at the time the joint account was created by Lois H. Brownback from her own funds, she did not intend to make any gift to decedent or create any interest in her favor, and also in our legal conclusion that there was, as a result, no tax liability.
“When any property is held in the names of two or more persons, or is deposited in a financial institution in the names of two or more persons, so that, upon the death of one of them, the survivor or survivors have a right to the immediate ownership or possession and enjoyment of the whole property, the accrual of such right, upon the death of one of them, shall be deemed a transfer subject to this tax under this act, of a fractional portion of such property to be determined by dividing the value of the whole property by the number of joint tenants in existence immediately preceding the death of the deceased joint tenant.”
A signature card stating that the account was joint, with right of survivorship, and which was signed by both decedent and Lois H. Brownback, has been attached to the record, though not available at the hearing. It might be helpful if we first review some of the cases cited by counsel.
In Cochrane’s Est., 342 Pa. 108, the constitutionality of taxing a proportionate or pro-rata share of a joint asset, regardless of the amount of the contribution of a deceased joint tenant, was established. The court determined that a surviving joint tenant acquires a right to immediate ownership, possession and enjoyment with respect to the whole fund, since, regardless of the source or sources of the property in the joint account, the rights of each of the tenants are coequal.
In Commonwealth v. Nolan’s Est., 345 Pa. 98, an account standing originally in the name of Mary Nolan alone was made joint when she added the name of her sister, Margaret, the decedent. Both signed an agreement specifically creating a joint account with right
In Fisher Est., 443 Pa. 419, the court was confronted with the issue of the ownership of four savings accounts, held jointly by decedent and his sister, which the Commonwealth sought to subject to inheritance tax. The lower court held that the original owner of the accounts (the survivor) had not intended to make an inter vivos gift of a joint interest in them to decedent. The record lacked the language of the contract governing the accounts, however, since no signature cards or other contractual documents were in the record. In those circumstances, the Supreme Court ruled that there was nothing to prove that an effective inter vivos gift had been made to decedent, and, therefore, the accounts could not be taxed.
The principal case on which the Commonwealth here relies is Olson Est., 447 Pa. 483. The estate objected to imposition of an inheritance tax on savings accounts created out of funds originally owned by Paul H. Olson, decedent’s brother and the survivor, which had been made joint accounts with decedent by Paul H. Olson. The issue in the trial court was whether
In the present case, and as stated in the adjudication, we were impressed by the testimony of the survivor, Lois H. Brownback, regarding the circumstances of the creation of the account in question. She testified that she was older than decedent, and that the original account in her name alone, from which the funds creating the joint account had been taken, had grown to exceed the amount of deposit insurance provided; this was one circumstance which impelled her to turn one account into two. Her principal reason for so acting, however, was “that I would have somebody to get some money to do something for me if I needed it.” When questioned as to whether or not she intended to make a gift to decedent when the account was established, she said, “Not with that account, I didn’t. I left her some money in my will, but I didn’t intend to give her that.” She further testified that she kept the deposit books and paid the income tax on the dividends from the
We have studied the comprehensive opinion of the Supreme Court in Olson Est., supra, but we do not think that it rules- this case. It is the allegation of Lois H. Brownback that decedent never had rights of any sort, be they of ownership, control, access, use, income, benefit or however characterized, and that, therefore, section 241 of the act is not applicable. We are satisfied that the record supports this contention.
The rationale of Olson Est., supra, was that the accounts were, in point of law, joint, with right of survivorship, but that they had been made so because of accident or mistake by the original owner of the money; the court ruled, however, that accident or mistake had not been proven. Here, on the contrary, the claim is that the account never had such an effect, and that, therefore, the condition of section 241 of the act, requiring that the death of a joint tenant have the legal effect of conferring upon the surviving tenant or tenants a right which they did not previously have, does not apply. As we read it, the statute mandates
We are also mindful that Lois H. Brownback stated under questioning by counsel for the Commonwealth that if she had died before decedent, the money would have gone to decedent. The Commonwealth urges that this shows a donative intent in the mind of Lois H. Brownback sufficient to make this a true joint account with right of survivorship. But this testimony is actually not more than an expression of a legal conclusion by Lois H. Brownback, who is not a lawyer, and who admittedly is not learned in the rules of law surrounding such accounts. In any event, such testimony does not show an intent to create any present, immediate interest in favor of decedent, at the time the account was opened.
All of the exceptions to the adjudication are dismissed.