Could the probate court order return of funds transferred from a joint account to avoid paymentto a creditor?

The parent was in nursing home for ten years then died. Creditor loaned parent money for health care. The parent was stripped of cash by sibling who was a joint owner of an account with the parent. In the last 3 years and more so as parent’s condition worsened, the cash was withdrawn. Records indicate the withdrawals were not to pay parent’s expenses. Sibling contributed nothing to joint account. Does the creditor have to sue sibling to obtain funds to pay off the loan or can the probate court just order the sibling to return the money to the estate so the estate can repay the creditor?

Asked on July 25, 2010 under Estate Planning, Texas


M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

I am sorry for your loss.  The "trouble" with a joint account is that generally, the funds inside are considered to be owned by both of the parties.   Unless that generality is challenged in some way by some one the account probably has rights of survivorship and the money will go to the other party upon the death of one of the owners. Here, the creditor will sue the Estate of your parent and not the sibling.  It is a debt of the estate.  The Personal Representative of the estate of the parent (the executor if there is a Will) will have the duty and power to go after the funds if there appears to have been a misappropriation.  All this is couched in what your state law allows.  The attorney for the estate will help the personal representative. Good luck. 

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