The Differences Between Joint Bank Account and Joint Property

There are some particular features of a joint bank account that distinguish it from a joint tenancy in real property and these have been discussed by our Court of Appeal (Bergen v. Bergen, 2013 BCCA 492): ( see my blog on Bergen dated August 26.14

These differences between a joint bank account and a jointly owned real property as discussed in the Bergen case were re-iterated recently by Justice Steeves in Zeligs v Janes 2015 BCSC 7:

[39] The practicalities of a joint bank account … are different from those of a joint tenancy in respect of other forms of property.

Obviously, a depositor’s interest in a bank or investment account is a chose in action: the depositor is a creditor, and the bank or other depository is a debtor that is bound, subject to the terms of the agreement between them, to pay over the balance in the account on demand. In this context, it is difficult to conceptualize the operation of the four unities (of title, interest, time and possession) from which joint tenancy historically arose. (See generally Law Reform Commission of British Columbia, Report on Co-Ownership of Land (1988), at 3.)

Most importantly, where one of the holders of a joint account wishes to discontinue the arrangement and eliminate the right of survivorship, the usual course is to bring the account to an end – if necessary by draining it to a zero balance. (See generally Waters (4th ed.) at 440 [Waters’ Law of Trusts in Canada, 2012]; see also Edwards v. Bradley, supra at 233, quoted above [[1956] O.R. 225 (Ont. C.A.)]; and Pecore at para. 50.)

The remaining account-holder who claims to have had a beneficial interest in the withdrawn funds may pursue an equitable remedy such as constructive trust or tracing (see Waters, 4th ed., at 440), but this may be a complex process.

[181]     As I see it, the dynamic nature of joint accounts with funds being withdrawn and deposited over time does not easily accommodate the application of the unities. The nature of the joint account is that it is to be used for withdrawals and deposits and it cannot be that one of the unities is destroyed by doing so. In short, the withdrawal of funds by one tenant by itself cannot sever a joint account. In contrast, in the case of real property, either tenant can sever the joint tenancy at any time by destroying one of the unities and the value of the resulting equal shares held in of the unities and the value of the resulting equal shares held in common is subject only to market conditions. 

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