I had a joint account with my mother with the money from the joint account I bought property (CASH) 9 month ago - In my name only. I have allowed her to live in the residence and now I plan on selling the property. She feels she has some rights to this property?
State/Country relating to question: California
I have served her with a 60 day notice to vacate the premises
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Good morning. Where did the money in the joint account originate? Was the money yours and you added your mother to the account? Or, was the money your mother's and she added you to the account? Thanks.
The money was hers and she added me to her account and at the bank because there was a large amount in the account they had her sign a document stating she was aware that putting me on her account would give me all rights and access to the funds in the account
Thanks. Unfortunately, your mother is going to have a claim to this property. California's Multi-Party Accounts Law regulates the ownership interests of parties to a joint account in a bank, credit union, or other financial institution. As a general rule, the ownership interest of non-married parties is based on their respective net contributions to the account, unless a written agreement or some other clear or convincing evidence indicates a different intent. If the net contributions cannot be determined, the parties to the account are generally assumed to have an equal interest in the account. Until 2003, it was generally assumed that a party retained a proportional ownership interest in any funds withdrawn by another party. However, in Lee v. Yang (2003), a California appellate court held that the proportional ownership rule only applied to the "sums on deposit." Under the reasoning of Lee v. Yang, when one party withdraws funds from a joint account those funds are assumed to be a "gift" to the withdrawing party; the other party loses its ownership interest in the withdrawn funds. In other words, as happened in Lee v. Yang, one party could unilaterally empty all funds from a joint account and the other party would have no recourse. In response to this decision and its troubling implications, the California Law Revision Commission (CLRC) came up with a simple solution that would effectively overturn Lee v Yang: delete the words "sums on deposit" from the existing statute to clarify that a party's proportional ownership interest extends to the funds generally, even after they are withdrawn, and not only to the amount that happens to remain on deposit. This bill adopts the CLRC approach and makes corresponding changes to provisions on rights of survivorship in withdrawn funds.
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Texas lawyer for 32 years; Also RE developer
What are my legal rights to the property and does it matter that 10 months has gone by since I took the funds from our joint account but in my own account - purchased the house and she was fine with everything but now because of circumstances and Im selling the property and she is refusing to get out and wants half of the sell price. What can I do to protect my investment
You would have to show evidence that she intended the money withdrawn to be a gift. Otherwise your argument would have to be that although you may owe your mother the money because it belonged to her, that the house is yours because you bought it. But, your mother's counter to that will be that the transactions of taking the money out, putting it in your account, and then buying the house should be collapsed and the house really belongs to you. Unfortunately, the facts here do not favor you because the court is likely to determine you really have no investment here....rather, that the investment involves all your mother's money. Your best outcome here is likely to be returning your mother's money to her with interest; and then if there is any profit above that, it would belong to you. I'm sorry I don't have more optimistic news for you, but I feel it's my responsibility to provide the legalities of this so you have the best information you can have in resolving this.
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