The Michigan Court of Appeals recently had another chance to remind families of the danger of jointly owned property. In the case of In Re Estate of Dolores C. Soltys, the Court was presented with a fairly typical estate planning case.
Mom and Dad had three children, but added only one of the three onto their various accounts. After the parents died, that child claimed all the assets were hers. The other children had to sue for their shares of Mom and Dad's assets.
The family engaged in a lengthy trial in St. Clair County Probate Court, appeals to both the Court of Appeals and the Michigan Supreme Court and a remand to the Court of Appeals. The Court of Appeals agreed with the Probate Court that although there is a PRESUMPTION that the joint owner gets to keep the assets at death, the other children had overcome that presumption. They had shown evidence that the parents always said that the kids would be treated equally, that there were no disagreements in the family at the time the daughter was added to the accounts, and that the parents said they added a child to their account "in order to avoid probate".
Ironically, the parents' attempts to avoid probate court spawned six years of court battles between their children. This turmoil could have easily been avoided by creating a revocable living trust and transferring their assets to the trust.