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BUCK v. JORDAN, et al. (59760)


BUCK

v.

JORDAN, et al.


November 6, 1998
Record No. 972315

MALLORY BUCK, EXECUTOR OF THE ESTATE OF CALVIN
HUGH BUCK

v.

SANDRA B. JORDAN, ET AL.

OPINION BY JUSTICE CYNTHIA D. KINSER
FROM THE CIRCUIT COURT FOR THE CITY OF NORFOLK

Everett A. Martin, Jr., Judge
Present: All the Justices

 


The primary issue in this appeal concerns the
ownership of an investment account registered as belonging to
joint tenants with rights of survivorship. Because the language
of the account agreement overcomes the presumption that the
account was opened for the convenience of the decedent, we will
affirm the circuit court’s judgment awarding the funds in the
account to the surviving joint tenant.

I.

On July 10, 1991, Calvin Hugh Buck (Buck) and
his daughter Sandra B. Jordan (Jordan) opened a joint investment
account (the Account) with Sovran Investment Corporation,
NationsSecurities’ predecessor. Buck and Jordan signed a form
titled "New Account Information" (the Agreement) and
entered into the Account as "Joint Tenants with Rights of
Survivorship and not as tenants in common or as tenants by the
entirety."
[1] The parties do
not dispute that Buck funded the Account with $100,000 and that
the funds were used to purchase a United States Treasury Note.

After Buck suffered a stroke in May 1995, he
and his family met on November 4, 1995, to discuss his business
affairs. During this meeting, Buck learned that Jordan had
withdrawn $30,000 from one of the bank accounts he held jointly
with her. Buck asked Jordan to put the money back into the bank
account, but Jordan refused and stated that she was going to have
her father evaluated to determine his competency.

After this dispute, Buck removed Jordan’s name
from several joint accounts. With regard to the Account at
NationsSecurities, Buck specifically asked his son, Ronald Buck
(Ronald), on two separate occasions to call NationsSecurities and
inquire as to how the Account was set up. Buck wanted to know
whether he had made Jordan the beneficiary of the Account and, if
so, what steps he needed to take to remove her as the
beneficiary. Accordingly, Ronald called NationsSecurities twice
and spoke with Sue Carmen (Carmen) each time. Ronald testified as
follows regarding the first conversation:

Q. And what did she tell you?

A. She told me that the account was joint
tenants in common and I asked her, I said, "What does that
mean?" She said, "That means that both own equal shares
in the account and if one passes away the Estate of that
individual will receive that half and the other living party will
get half".

Ronald testified that when he called
NationsSecurities the second time, he initially spoke with a
receptionist who advised him that the Account was "joint
survivorship," meaning "if one passes away
. . . the survivor gets 100 percent of the
account." Kenneth C. Buck was listening to the conversation
on another telephone and related this information to his father.
Buck then directed Ronald to advise the person on the telephone
that he wanted to take his money out of the Account. When Ronald
relayed this directive to that person, the individual decided to
connect him with someone who would be more familiar with the
Account. Ultimately, Ronald again talked with Carmen. At trial,
Ronald recounted his second conversation with Carmen:

A. I told her what the receptionist said, or
whoever the lady was that answered the phone, and she was very
disturbed. She said, "This individual has no knowledge on
this account whatsoever."

Q. This individual, meaning who?

A. The lady that answered the phone that first
talked to me. She said, "I am very familiar with the
account. I have already told you one time that it was joint
tenants in common and that’s the way it is". I said,
"Well, my fatherwanted to know if he could draw the money
out", and she said, "Yes. He can draw the money out or
Sandra can draw it out, but both names will be on the
check".

Q. All right. Did she explain again what she
meant by that?

A. She told me again, assured me, to tell my
father that it was 50 percent each or joint ownership and that
joint tenants in common, she said, is initialled
"J.T.C." on the account.

After this call to NationsSecurities, Buck
concluded that it would be pointless to withdraw the funds since
the check would have Jordan’s name on it and he could not cash it
without her signature. Based on the information from Carmen that
50 percent of the funds in the Account would go to Jordan and 50
percent to the Estate, Buck reasoned that it would be better to
leave the funds in the Account so that they would continue to
earn interest.
[2]

Stephanie Adler Calliott, Senior Vice-President
at NationsSecurities, admitted that the information given to
Ronald that the Account was held as a tenancy in common was
incorrect. However, she also testified that, if Buck had asked
NationsSecurities to liquidate the Account in 1995, the check
would have been made payable to the parties exactly as the
Account was titled, that is, to C. H. Buck and Sandra B. Jordan
as joint tenants. She further explained that NationsSecurities’
policy of issuing a check exactly as an account is titled is the
same whether an account is set up as belonging to joint tenants
with rights of survivorship or as owned by the parties as tenants
in common.

On December 23, 1995, Buck died. He was
survived by five children. A dispute then arose in regard to the
ownership of the funds in the Account. As a result of that
dispute, Jordan commenced this action by filing a bill of
complaint against NationsSecurities and the executor of the
estate of Calvin Hugh Buck (the Estate) seeking a declaratory
judgment that she, not the Estate, was the sole owner of the
Account.
[3] In response,
NationsSecurities sought to interplead the funds in the Account
and be dismissed from the suit. The Estate filed a cross-bill
against NationsSecurities and alleged breach of contract and
constructive fraud.

At a bench trial on July 22, 1997, the circuit
court granted NationsSecurities’ motion for summary judgment on
the Estate’s breach of contract claim. The court also granted
partial summary judgment to Jordan and ruled that the Estate had
the burden of going forward with the evidence to establish that
Buck had not intended for Jordan to receive all the funds in the
Account upon his death. The court specifically found that the
language in the Agreement signed by Buck and Jordan to open the
Account was "clear, unambiguous, and unequivocal and
sufficient to rebut the presumption that the account was opened
solely as convenience to Mr. Buck."

At the conclusion of the Estate’s evidence, the
court granted Jordan’s motion to strike and ruled that she was
entitled to the funds in the Account. However, the court denied
NationsSecurities’ motion to strike the Estate’s evidence on the
constructive fraud claim. After hearing NationsSecurities’
evidence, the court determined that the Estate’s constructive
fraud claim should be dismissed on the basis that the
misrepresentation by NationsSecurities that any check issued to
close the Account would be payable to Buck and Jordan was a
misrepresentation of law and not one of fact, and that the Estate
had not proven its damages. The court entered its final order on
August 7, 1997. The Estate appeals.

II.

We first address the assignment of error that
pertains to the action commenced by Jordan to determine the
ownership of the funds in the Account. The Estate assigns error
to the circuit court’s ruling, after granting partial summary
judgment to Jordan, that the Estate had the burden of going
forward with the evidence to show that it was not Buck’s intent,
at the time that the Account was opened, for title to the Account
to pass to Jordan upon his death.

With regard to this issue, the Estate argues
that evidence of Buck’s intent at or near the time of his death
is more compelling than evidence of his intent when the Account
was first opened and should be used to determine whether he
intended for title to the Account to pass to Jordan upon his
death. The Estate contends that Buck’s intent with regard to the
Account changed after learning that Jordan had withdrawn funds
from another joint account. Buck manifested his new intent by
revoking a power of attorney previously given to Jordan and
removing her name from other joint accounts. Thus, the Estate
asserts that Buck’s intent just prior to the time of his death
rather than the language of the Agreement should be dispositive.

We begin our analysis of this issue by noting
that the investment account at NationsSecurities is not an
"account" as defined in Code Sect.6.1-125.1(1).
[4] See Bennet
v. First & Merchants Nat’l Bank
, 233 Va. 355, 360, 355
S.E.2d 888, 891 (1987) (holding Treasury Bill was not an
"account" within meaning of Title 6.1, Chapter 2.1).
Thus, Code Sect.6.1-125.5(A), which provides, in pertinent part,
that any sum remaining on deposit at the death of a party to a
joint account belongs to the surviving party, does not apply to
this case.

However, we are not without statutory guidance
in resolving this issue. Although Code Sect.55-20 abolished the
common law right of survivorship between joint tenants, Bennet,
233 Va. at 360, 355 S.E.2d at 891, Code Sect.55-21 creates an
exception "when it manifestly appears from the tenor of the
instrument that it was intended the part of the one dying should
then belong to the others." We have previously held that
this section applies to bank accounts, Colley v. Cox, 209
Va. 811, 814, 167 S.E.2d 317, 319 (1969); Wilkinson v.
Witherspoon
, 206 Va. 297, 304, 142 S.E.2d 478, 483 (1965); Johnson
v. McCarty
, 202 Va. 49, 56, 115 S.E.2d 915, 920 (1960), and
we hold that it equally applies to the Account at issue in this
case. Thus, pursuant to Code Sect.55-21, we must examine the
"tenor of the instrument" that Buck and Jordan signed.

In selecting the type of account to be opened
at NationsSecurities, Buck and Jordan checked the box for
"Joint Tenants with Rights of Survivorship." This
section of the Agreement further states that "[i]n the event
of the death of either or any of the undersigned, the entire
interest in the Joint Account shall be vested in the survivor or
survivors . . . ." This language is
unambiguous and manifestly signifies the intent that the entire
interest in the Account would vest in the surviving tenant upon
the death of the other joint tenant. The Agreement thus satisfies
Code Sect.55-21 and reflects Buck’s intent that Jordan would
acquire ownership of all the funds in the Account upon his death.

In reaching this conclusion, we are not
unmindful of the presumption "that a deposit by a person in
the name of himself and another, not his wife, was made for the
convenience of the depositor, and the presumption is strengthened
by the illness or disability of the depositor." Thurston
v. Maggard
, 220 Va. 815, 818, 263 S.E.2d 64, 66 (1980).
[5] However, we have addressed language in other account
agreements or signature cards similar to that at issue in this
case and concluded that, in light of such language, this
presumption "pales" or is overcome. Wilkinson,
206 Va. at 305, 142 S.E.2d at 483; accord Thurston,
220 Va. at 818, 263 S.E.2d at 66; Robbins v. Grimes, 211
Va. 97, 100, 175 S.E.2d 246, 248 (1970); Campbell v. Campbell,
211 Va. 31, 33, 175 S.E.2d 243, 245 (1970). In contrast, we held
in Colley, 209 Va. at 817, 167 S.E.2d at 321, that no
survivorship account was created because the depositor gave no
instructions to the bank when an account was opened and the
signature card did not contain any contractual language
indicative of the intent to create a survivorship account.

The Estate, nevertheless, argues that our
decisions in Wilkinson and Thurston are not
applicable to this case because the signature cards in those
cases not only included language vesting title to the accounts in
the surviving joint tenants but also contained an agreement
between the joint tenants that any funds deposited in the
accounts during their joint lives would be joint property.
Although the Agreement in this case does not contain this
additional language, we, nevertheless, conclude that the
Agreement manifests a clear intention on the part of Buck that
the Account would belong to Jordan upon his death.

As we have previously stated, "the rights
of the parties are to be determined . . . by rules
pertaining to the interpretation of contracts." Wilkinson,
206 Va. at 304, 142 S.E.2d at 483. The Agreement is a contract
between Buck, Jordan, and NationsSecurities, and the rules for
interpreting contracts require that we give effect to the
intention of the parties. Id. "Where the terms of the
deposit show a clear intention that title shall vest in the
survivor, the intention is upheld." Thurston, 220 Va.
at 818, 263 S.E.2d at 66.

Thus, we conclude that the circuit court did
not err when it required the Estate to go forward with the
evidence to show a contrary intent at the time the Account was
opened. After finding that the signature card in Thurston
rebutted the presumption that the account was opened as a
convenience to the decedent, we specifically stated that the
burden of going forward with the evidence fell upon those
opposing the claim of the surviving joint tenant. Id. at
819, 263 S.E.2d at 67. We then noted that no attempt was made to
establish that the decedent was mentally incompetent when he
executed the signature card or that he signed by mistake or as a
result of undue influence. Id. Likewise in the present
case, the Estate did not present evidence of fraud, undue
influence, or mental incompetence at the time Buck signed the
Agreement. Absent such proof, the ownership of the Account as
evidenced by the Agreement prevails. Since the Agreement is a
contract between three entities, it cannot be altered solely
because one party’s intent changes. Therefore, evidence
that Buck’s intent changed subsequent to opening the Account is
not pertinent to determining whether Jordan acquired title to the
Account upon Buck’s death.

We next address the Estate’s assignment of
error with regard to the circuit court’s granting
NationsSecurities’ motion for summary judgment on the breach of
contract claim. The Estate claims that NationsSecurities breached
its contract with Buck by refusing to close the Account and issue
a check for the proceeds solely in Buck’s name. We do not agree.

One of the essential elements of a cause of
action for breach of contract is that a legal obligation exists
from one party to another. Caudill v. Wise Rambler, 210
Va. 11, 13, 168 S.E.2d 257, 259 (1969). The Agreement authorizes
but does not obligate NationsSecurities to make payments of the
monies in the Account, even if such payments are to only one of
the joint tenants. Thus, NationsSecurities had no legal
obligation to issue a check solely in Buck’s name, and the trial
court, therefore, did not err in granting summary judgment for
NationsSecurities on this issue.

In paragraph 16 of the Agreement, Buck and
Jordan agreed, in consideration of NationsSecurities’ carrying
the joint account, that each of them could individually take
actions with respect to the Account without notice to the other
joint tenant and authorized NationsSecurities to follow the
instructions of either one of them. Paragraph 16 allows
NationsSecurities to deal fully and completely with either joint
tenant as though either one of them was solely interested in the
Account. Thus, as Calliott explained, NationsSecurities would
accept instructions from either joint tenant to sell a security
and provide proceeds, but it would issue a check made out exactly
as the account is titled, which in this case was C.H. Buck and
Sandra B. Jordan as joint tenants. Nothing in the Agreement
requires NationsSecurities to do otherwise.

Turning now to the constructive fraud claim, we
first consider the Estate’s assignment of error that the trial
court erred by ruling that NationsSecurities’
"misrepresentations as to the type of account in which
Calvin Buck’s money was invested were only misrepresentations of
law, not misrepresentations of fact." The Estate argues that
the statements by NationsSecurities that the Account was
registered as being held by tenants in common when actually it
was owned by two joint tenants with rights of survivorship was a
misrepresentation of fact.

In response, NationsSecurities contends that
the misrepresentation contained in the Estate’s assignment of
error was neither relied upon by it before the circuit court nor
decided by that court. NationsSecurities also contends that the
Estate did not object to the court’s failure to rule on the issue
whether the statement that the Account was held as tenants in
common was a misrepresentation of law or fact. Thus,
NationsSecurities asserts that the Estate has procedurally
defaulted this assignment of error. We agree.

The Estate never advised the circuit court that
the misrepresentation upon which it was relying to assert a claim
for constructive fraud was the statement that the Account was
registered as tenants in common.
[6] Instead, the
Estate argued to the circuit court that the misrepresentation of
fact was that Jordan was an owner of the Account and that the
Estate and Jordan would each receive 50 percent of the Account
upon Buck’s death.
[7] Moreover, when
the circuit court specifically identified the misrepresentation
upon which it was ruling, the Estate did not object.
[8] And the Estate
never objected to the court’s failure to decide whether the
misrepresentation regarding how the Account was held was one of
law or fact.

Rule 5:25 provides, in part, that "[e]rror
will not be sustained to any ruling of the trial court
. . . unless the objection was stated with reasonable
certainty at the time of the ruling . . . ."
This Court has held that "[t]he purpose of requiring timely
specific objections is to afford a trial court the opportunity to
rule intelligently on the issues presented, thereby avoiding
unnecessary appeals and reversals." Chawla v.
BurgerBusters, Inc.
, 255 Va. 616, 622, 499 S.E.2d 829, 832
(1998) (citing Wright v. Norfolk & Western Ry. Co.,
245 Va. 160, 167-68, 427 S.E.2d 724, 728 (1993)). We have
repeatedly refused to consider issues or objections raised for
the first time on appeal. See, e.g., Cardinal
Dev. Co. v. Stanley Constr. Co., Inc.
, 255 Va. 300, 305, 497
S.E.2d 847, 850 (1998); Fairfax Hosp. v. Curtis, 254 Va.
427, 447-48, 492 S.E.2d 642, 648 (1997); Angstadt v. Atlantic
Mut. Ins. Co.
, 254 Va. 286, 291, 492 S.E.2d 118, 121 (1997); Clarendon
House, Inc. v. Helfert
, 213 Va. 28, 29, 189 S.E.2d 331, 331
(1972). Thus, we conclude that the Estate waived the assignment
of error as presented and failed to assign error to the trial
court’s actual finding that the statement that Buck could not
withdraw the funds in the Account without Jordan’s name appearing
on the check was a misrepresentation of law. Therefore, we
conclude that the circuit court did not err in granting judgment
for NationsSecurities on the constructive fraud claim.
[9]

For these reasons, we will affirm the judgment
of the circuit court.

Affirmed.

 

 

FOOTNOTES:

[1] The Agreement
signed by Buck and Jordan further provided that "[i]n the
event of the death of either or any of the undersigned, the
entire interest in the Joint Account shall be vested in the
survivor or survivors on the same terms and conditions as
theretofore held, without in any manner releasing the undersigned
or their estates from the liability provided for in this
Agreement."
In August 1993, NationsSecurities sent out a new account
agreement in order to update its records. Jordan concedes that
she signed her name and Buck’s name on this agreement. In
completing the Account papers, Jordan checked two boxes, one for
"Rights of survivorship" and one for "Tenants in
common." Since none of the parties contends that this second
agreement has any effect on the outcome of this case, we will not
consider it in our decision.

[2] Mallory H. Buck
and Kenneth C. Buck confirmed that their father decided to leave
the funds in the Account since it was his understanding that the
Estate would receive half of the funds when he died.

[3] As an
alternative remedy, Jordan asked for reformation of the Account
to the extent necessary to entitle her to all the funds in the
Account.

[4] Code
Sect.6.1-125.1(1) defines "account" as "a contract
of deposit of funds between a depositor and a financial
institution, and includes a checking account, savings account,
certificate of deposit, share account, and other like
arrangement."

[5] In regard to
contracts of deposit between a depositor and a financial
institution, Code Sect.6.1-125.5 abolished this presumption,
effective July 1, 1980. Thurston, 220 Va. at 818 n. *, 263
S.E.2d at 66 n. *.

[6] The Estate also
did not plead this misrepresentation. In its cross-bill, it
alleged that NationsSecurities committed constructive fraud based
on its false representations that Buck could not withdraw the
funds in the Account unless Jordan’s name appeared on the check.
In Henderson v. Henderson, 255 Va. 122, 126, 495 S.E.2d
496, 499 (1998), we stated that "[f]raud, whether actual or
constructive, is never presumed and must be strictly proved as
alleged." Accord Mortarino v. Consultant Eng’g
Serv.
, 251 Va. 289, 295, 467 S.E.2d 778, 782 (1996).

[7] The following
excerpt is an example of the Estate’s argument before the circuit
court: [T]he representation is as an existing fact and that
existing fact is whether or not Sandra Jordan was an owner of
this account . . . . And there was a clear representation that
was not only made once, but it was reiterated, that she was the
owner and that the Estate would have 50 percent of it . . . .

[8] In announcing
its decision, the circuit court specifically identified the
misrepresentation upon which it was ruling by stating, "The
misrepresentation is that someone at [NationsSecurities] informed
the decedent that he could not withdraw the account unless
[Jordan's] name appeared on the check."

[9] We need not
address the remaining assignment of error regarding the circuit
court’s finding that the Estate did not suffer any damages.

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