Do you share a bank account with a spouse, child, or sibling? Many families do this because it feels simple, yet the paperwork behind those accounts decides who owns the money after one owner dies.
At Bromlow Law, PLLC, we have seen smooth transitions and bitter disputes spring from the same kind of account, only distinguished by a few missing words. This article walks through the Texas rules on rights of survivorship, highlights common traps, and shows how our team, led by attorney Laura L. Bromlow, helps clients protect both assets and relationships.
Requirements for Creating a Valid Right of Survivorship in Texas
Texas does not presume that a joint account will pass automatically to the survivor. In fact, Section 113.151 of the Estates Code demands a very specific agreement before that can happen.
- The agreement must be in writing, and the person whose funds are involved must sign it.
- It has to be said that, at death, all sums in the account will belong to the surviving party as separate property.
- Short phrases such as “JT TEN” or “Joint Tenancy” do not meet this standard.
- The bank may use its own form, but the disclosure must match the “Uniform Single-Party or Multiple-Party Account Form” found in Section 113.052.
- The text should leave no doubt about the depositor’s intent; anything vague opens the door to litigation.
Because the statute is unforgiving, we review every new account card with our clients, making sure the survivorship language appears on the same document that is signed. That careful step leads into the next subject—the case that set the tone for today’s rule.
Key Case Law: Stauffer v. Henderson
In Stauffer v. Henderson, 801 S.W.2d 858 (Tex. 1990), a woman opened a joint account with her sister, and both signed the bank’s signature card. When the woman died, her husband argued that the funds were community property while the sister claimed the balance by survivorship. The Texas Supreme Court sided with the husband because the card merely let either signer withdraw money; it did not contain the sentence creating a right of survivorship.
The court held that Section 439 of the predecessor statute offers the exclusive path for a survivorship account. If the written agreement is complete and clear, outside evidence cannot be used to prove intent. That ruling still guides courts, so an account holder’s signature without the magic words is worthless for survivorship purposes.
This decision teaches a direct lesson for modern families, leading us to consider what happens when a loved one signs nothing more than a convenience card.
Potential Pitfalls and Unintended Consequences
A common scenario involves an older adult who adds a child or friend to a checking account only so that someone can pay bills. Without the right documents, Texas law will treat that setup as a full survivorship account, even if the elder wanted the money divided under a will.
| Pitfall | What Happens | Simple Fix |
| Name added for convenience only | Survivor keeps every dollar by default | Use a power of attorney instead of joint ownership |
| Old account card lost | Heir may introduce parol evidence, but must meet a high burden | Request new paperwork and keep copies in the estate file |
| Signature card uses abbreviations | The court is likely to find no survivorship | Ask the bank to include the full statutory sentence |
The South Carolina case, Abernathy v. Latham, 545 S.E.2d 848 (2001), underscores the risk. The account owner opened a joint account years before signing a will that split her estate among nieces. Because she never changed the account documents, the court let the surviving joint owner keep the money, leaving the nieces with nothing. Similar outcomes can trigger claims such as Intentional Interference with Inheritance, unjust enrichment, or requests for a constructive trust, all of which drain estates through legal fees.
Planning around these hazards also means knowing when probate will still be needed.
Joint Accounts and Probate
If a joint account lacks a valid survivorship clause, the funds flow into the probate estate. At that point, the account is frozen until the personal representative receives letters testamentary. Even when the sole beneficiary under a will is the surviving spouse, a probate filing is required to clear the deceased owner’s name from deeds, vehicle titles, and financial accounts.
In short, a will does not transfer anything by itself; the probate court’s order makes the document effective. When families skip survivorship language by mistake, the probate path becomes unavoidable and often more costly than preparing proper bank forms in advance. As the next section shows, extra wrinkles can appear even when the account paperwork seems in order.
Other Important Considerations
While a properly executed survivorship agreement can simplify estate matters, several additional issues can still affect how joint accounts are treated. From lost paperwork to creditor claims and bank protections, these factors can complicate even well-intentioned plans. Understanding these considerations can help you avoid surprises and protect your loved ones from future legal hurdles.
Lost Account Documents
When the original signature card disappears, the general rule against outside proof softens. In Bank of America v. Haag, 37 S.W.3d 55 (Tex. App.—San Antonio 2000), the court accepted clear and convincing testimony to recreate the lost agreement. That burden sits far above the usual preponderance standard, so anyone relying on a misplaced form should gather multiple witnesses or copies made at the time of signing.
Financial Institution’s Right to Offset
Banks may apply funds in a depositor’s joint account to satisfy that depositor’s debt owed to the same bank. If the joint account is a revocable trust or “in-trust-for” setup, creditors of the grantor may still reach the balance. Careful account selection and debt review remain wise before naming co-owners.
Safe Harbor Provision
Section 113.202 protects a bank that pays out according to the account agreement. The institution:
- Does not have to trace where deposits came from or how withdrawals will be used.
- It is fully discharged once it releases funds that match the terms on file, even if that conflicts with true ownership rights among the parties.
This shield means the fight often shifts away from the bank and lands between heirs and the surviving co-owner, making preventive planning even more appealing.
Need Estate Planning or Probate Guidance? Contact Us Today
At Bromlow Law, PLLC, we help families in Texas and California plan with purpose. With over 20 years of experience, Laura L. Bromlow provides practical support for wills, trusts, POAs, and survivorship agreements, ensuring your documents reflect your goals and prevent future disputes. Whether you’re managing a joint account or updating beneficiary designations, call us at (281) 665-3807 or visit our Contact Us page to schedule a consultation. A short conversation today can bring clarity and peace of mind for tomorrow.