The Gazette 1996

87 / 448

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 brings us into line with other
common law jurisdictions".4
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
transaction if the donee is not
involved in the opening 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
the personal representatives clear
instructions as to the intention of
the donor.
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
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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