The Gazette 1996

GAZETTE

MARCH 1996

The learned judge concluded that at law the niece had a legal interest in the monies on deposit "either by reason of the contractual relationship of the parties, or, in the alternative, as a gift which admittedly was not a completed gift in the conventional sense but is nonetheless one that should be upheld as being a gift subject to a contingency viz. that of the death of the donor which contingency does not disqualify it as being a proper gift.'" Referring specifically to the reliance of the court in Owens -v- Greene on the principle that testamentary dispositions should be required to comply with the relevant statutory requirements, O'Flaherty J simply stated: "Of course, if one were dealing with a testamentary disposition there would have to be compliance with the relevant requirements of the legislation in question. But that is to beg the question; if the arrangement made was not testamentary (which in my judgment it was not) then the legislative provisions (see Part VIII of the Succession Act 1965) have no application." Some explanation as to why the court considered the disposition to be other than testamentary would perhaps have been of interest but the effect is certainly clear. Despite exhortations that Owens -v- Greene should not be overruled since it had stood for so long and therefore had been relied upon over the years by practitioners in advising clients, O'Flaherty J held that that decision was wrongly decided and should be overruled. In conclusion, the learned judge stated that his decision would introduce a measure of consistency in our jurisprudence, commenting that "it restores equity to the high ground which it should properly occupy to ameliorate the harshness of common law rules on occasion rather than itself be in instrument of injustice. Further,

It is clear that the decision will have important implications for practitioners. Freed from the constraints of Owens -v- Greene, there is nothing now to stop a donor utilising a joint account to benefit a proposed donee without the necessity of changing an existing will, an option attractive to some donors. The advantage of there being no charge to probate tax on property passing by survivorship can also be noted. As a result of this decision, it can be said that the preferred method of effecting a gift of the proceeds of a joint account by survivorship is to involve the donee from the outset in the opening of the joint account. This will not appeal to every donor and it is also clear that it is by no means fatal to the validity of the account. Evidence of the intention of the donor regarding the proceeds of the account after his death will always be required to rebut the presumption of resulting trust. This evidence can take different forms such as written instructions to the bank, correspondence with the donee or members of the deceased's family. It is suggested that as a matter of course all banks should require clear instructions from parties opening joint deposit accounts. To avoid any possible disputes after death, it is suggested that when making a will, a testator should be asked to make a declaration concerning any joint accounts he has opened, which would be then placed with his will and which would give transaction if the donee is not involved in the opening of the Footnotes 1. Joint deposit receipts, once very popular and the source of considerable litigation in Ireland, were always relatively rare in other jurisdictions. 2. See, for example, McEvox -v- The Belfast Banking Company (1935) AC 24 and Russell -i - Scott, 11936] 55 CLR 440, a decision of the High Court of Australia. 3. O'Flaherty J did not elaborate on this point concerning the validity of a gift subject to the contingency of death, a view which is the personal representatives clear instructions as to the intention of the donor.

in apparent conflict with orthodox principles of property law. It appears that a revocable gift which is contingent on death constitutes a testamentary disposition which would be subject to the provisions of the Succession Act 1965. 4. Other common law jurisdictions which have rejected the basis of the decision in Owens - v- Greene include England (see Young -i - Sea lex (1949) I Ch. 278 and Re Figgis Deceased! 1968) 1 AER 999, both referred to by O'Hanlon J in the High Court), Canada (see Re Reid 64 DLR 598) and Australia (see Russell -v- Scott. [1936] 55 CLR 440). * Claire Mee, BCL, LL.B, is a solicitor with Patrick Casey & Co., Solicitors, Cork and is a tutor in Equity in University College, Cork. •

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it brings us into line with other common law jurisdictions". 4

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