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IN THE COURT OF APPEALS OF TENNESSEE AT NASHVILLE

MARY M. PAWLAKOS, Plaintiff/Appellee, VS. LAURIE WATSON PAWLAKOS, Defendant/Appellant.

) ) ) Stewart Chancery-Probate No. P2-024 December 2, 1998 ) ) Appeal No. 01A01-9708-CH-00443 Cecil W. Crowson ) Appellate Court Clerk ) ) )

FILED

APPEAL FROM THE CHANCERY-PROBATE COURT OF STEWART COUNTY AT DOVER, TENNESSEE THE HONORABLE ALLEN W. WALLACE, CHANCELLOR

ROBERT H. MOYER RUDOLPH, ROSS & FENDLEY, P.L.L.C. Clarksville, Tennessee Attorney for Appellant

DAN R. BRADLEY Waverly, Tennessee Attorney for Appellee

AFFIRMED IN PART, REVERSED IN PART AND REMANDED

ALAN E. HIGHERS, J.

CONCUR: W. FRANK CRAWFORD, P.J., W.S. HOLLY KIRBY LILLARD, J.

Respondent Laurie Watson Pawlakos (the Wife) appeals the trial court's order requiring her to return certain funds to the estate of her deceased husband, John T. Pawlakos (the Decedent). For the reasons hereinafter stated, we affirm in part and reverse in part the trial court's judgment.

I. Factual and Procedural History

The Decedent and the Wife had a nine-year relationship which culminated in their marriage on May 5, 1995. At the time of their marriage, the Decedent and the Wife knew that the Decedent was terminally ill with cancer. Approximately one month before his death, the Decedent and the Wife visited a branch of First American Bank where they signed the necessary signature cards to convert two of the Decedent's individual bank accounts into joint bank accounts. The account code on the signature cards indicated that the accounts were held as "joint tenants with right of survivorship."

By check dated May 20, 1995, the Wife withdrew $60,000 from one of the joint accounts and deposited the funds into her personal bank account. The Wife filled out the check, but the Decedent signed it. On June 14, 1995, two days after the Decedent's death, the Wife withdrew another $5,000 from the joint account.

In addition to withdrawing funds from the joint account, the Wife also withdrew funds from an account bearing the name of the Decedent's brother, Peter F. Pawlakos. Although the account bore the name of Peter Pawlakos, the Decedent opened the account, and he treated the funds in the account as his own. By check dated May 20, 1995, the Wife withdrew $6,000 from the Peter Pawlakos account. By check dated May 23, 1995, the Wife used $3,372.35 of the funds in the Peter Pawlakos account to pay her Optima credit card bill. The Wife signed Peter Pawlakos's name to both checks. According to the Wife, both of these checks were written at the direction of the Decedent. After the Decedent's death, the Wife withdrew the remaining $1,560.31 in the Peter Pawlakos account.

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The Decedent died on June 12, 1995. Thereafter, Mary M. Pawlakos, the Decedent's sister and one of the beneficiaries under the Decedent's will, filed a petition in probate seeking to recover the foregoing funds allegedly converted by the Wife, as well as other relief. After conducting a bench trial, the trial court entered a judgment which, inter alia, required the Wife to return the funds from the joint account and from the Peter Pawlakos account to the Decedent's estate. In requiring the Wife to return the funds from the joint account, the trial court found by clear and convincing evidence that the Decedent did not intend to create a joint account with right of survivorship when he signed the signature card converting his bank account from an individual to a joint account. With regard to the funds from the Peter Pawlakos account, the trial court reasoned that, regardless of the name appearing on the account, all of the evidence at trial indicated that these funds belonged to the Decedent. This appeal by the Wife followed.

II. Funds from the Joint Account at First American Bank

The trial court apparently based its ruling with regard to the joint account on our supreme court's holding in Lowry v. Lowry, 541 S.W.2d 128 (Tenn. 1976): Absent clear and convincing evidence of contrary intent expressed at the time of its execution, . . . a bank signature card containing an agreement in clear and unambiguous language that a joint account with rights of survivorship is intended, creates a joint tenancy enforceable according to its terms; and upon the death of one of the joint tenants, the proceeds pass to the survivor. Lowry, 541 S.W.2d at 132. In the present case, the signature card signed by the Decedent and the Wife clearly described the account as "joint tenants with right of survivorship." Accordingly, if the rule set forth in Lowry applies to this case, then the proceeds of the account passed to the Wife upon the Decedent's death unless clear and convincing evidence exists that the Decedent had a contrary intent at the time he executed the signature card.

Since our supreme court decided Lowry, however, the legislature amended Tennessee Code Annotated section 45-2-703 to add, inter alia, the following provision:

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A designation of "joint tenants with right of survivorship," or substantially similar language, shall be conclusive evidence in any action or proceeding of the intentions of all named that title vests in the survivor. T.C.A.

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