A recent decision at The UK Privy Council (a senior court) has confirmed that cash held in a joint bank account invariably passes by survivorship to the remaining account holders on the death of one account holder, without forming part of their estate, dismissing a claim by the beneficiaries entitled to the deceased’s estate that the cash should have formed part of his estate because he had provided all the money in the account.

Joint accounts are frequently set up by a couple to ensure that the survivor automatically becomes the sole owner of the account following the other’s death, and this decision confirms that this is how these types of arrangement work, irrespective of who provided the funds in the account in the first instance.

However, joint accounts are sometimes set up using funds from one person “the Donor”, appointing their carer as the joint accountholder, to allow the carer continued access to the Donor’s funds in the event the Donor loses the ability to manage their finances. The purpose of this type of arrangement is often to enable the carer to continue to make payments on the donor’s behalf, whilst avoiding the formalities of putting a Lasting Power of Attorney in place.

Setting up joint accounts for this purpose is risky. Notwithstanding the possibility that there will be no effective supervision to prevent the carer from accessing the joint account for their own benefit once the Donor is no longer able to manage their own affairs, this court decision highlights the likelihood that following the Donor’s death, the carer would automatically become outright owner of the balance of the account, regardless of whether this is what the Donor intended when setting up the arrangement. For example, if the Donor is leaving their estate in their Will to family, but the carer is a friend who lived nearby, would they have expected that the carer would be able to keep the balance of the account following the Donor’s death, or that the balance in the account would have reverted to their family?

A much safer approach is to appoint attorneys to manage your finances under a Lasting Power of Attorney in the event that you lose the ability to do so yourself.  This ensures that your accounts will stay in your ownership and will pass through your estate following your death. Furthermore, your attorney will be under a legal obligation to act in your best interests following the principles set out in the Mental Capacity Act 2005, and will be subject to the supervision of the Office of the Public Guardian.

At Jordans, our Private Client team advise varied clients, all looking to protect their finances, property, and other valuable goods. We recognise how important it is that this is done correctly, to provide peace of mind to everyone involved.


We are on hand to help with any queries you may have in regards to Lasting Powers of Attorney and Will writing. Our private client solicitors are based in Wakefield, Dewsbury, and Horsforth. Feel free to call us on 0330 300 1103 or request a call back by clicking here.

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