We have a customer who had a joint account at the bank, which he held jointly with his wife. He is a doctor. A few years back, he wanted to protect the bank account from potential creditors in a malpractice suit. He asked us to remove his name from the account. We obtained his signature but not his wife’s on the confirmation for his removal. Now they are having marital problems, and he is claiming that he is a joint owner on the account. He told us that we cannot remove a joint owner from an account without all of the joint owners’ signatures. Our attorney checked and said that was not the case. Can you confirm?

Jun 9, 2017

—

We believe that the husband could and did remove himself from the joint account without his wife’s signature. Under the Illinois Joint Tenancy Act, funds held in a joint account may be “paid to any one of” the account owners. Unless otherwise stated in your account agreement, this provided the husband with the authority to pay all of the account funds to his wife. In this case, he exercised that authority by removing his own name from the account.

We should note that there is conflicting case law in Illinois as to whether joint account owners may unilaterally remove other joint owners from an account without their consent or signatures. At least two Illinois cases have held that a joint account owner cannot remove another owner from the account or terminate the account without the other owner’s consent. However, a more recent case held that a joint owner could unilaterally remove other owners, without their consent, because the account agreement permitted the bank to pay account funds to any one of the account owners. We are not aware of any court decisions that reconcile these apparently conflicting opinions.

Here, the concerns about unilaterally removing another account owner are inapplicable. Consequently, mutual consent was not required for the husband to terminate his own interest in the account.

For resources related to our guidance, please see:

Joint Tenancy Act, 765 ILCS 1005/2(a) (“When a deposit in any bank or trust company transacting business in this State has been made or shall hereafter be made in the names of 2 or more persons payable to them when the account is opened or thereafter, the deposit or any part thereof or any interest or dividend thereon may be paid to any one of those persons whether the other or others be living or not, and when an agreement permitting such payment is signed by all those persons at the time the account is opened or thereafter the receipt or acquittance of the person so paid shall be valid and sufficient discharge from all parties to the bank for any payments so made.”)

In re Estate of Macak, 302 N.E.2d 436, 437–38 (1st Dist. 1973) (“[T]he nature of a joint tenancy agreement is such that it may not be terminated by a unilateral action of one of the parties, even though each has the authority to draw out all of the money.”)

Siemianoski v. Union State Bank of S. Chicago, 242 Ill. App. 390, 392, 394–95 (1st Dist. 1926) (“On September 22, 1921, after a quarrel with his wife, Rydzynski went to the bank alone and told Walter J. Prybylinski, an official of the bank, that he wanted to revoke his wife's authority ‘to draw money out’ of the account. . . . In the case at bar Rydzynski did not attempt to sever or terminate his interest in the joint account. He attempted to terminate the joint account altogether. But in our opinion the joint account could not be terminated altogether except by the mutual agreement of Rydzynski and his wife.”)

Drenckpohl v. Barker, 625 N.E.2d 651, 656 (5th Dist. 1993) (“The provision on the back of the certificates of deposit was applicable to the joint tenants at the time the joint tenancy was created, and it permits any one of the joint tenants to receive payment on the instruments by surrendering them to State Bank. . . . According to the terms incorporated into the certificates of deposit, Velma Drenckpohl was permitted to invade the corpus of the certificates of deposit to the detriment of the other joint tenants. It is undisputed that she did so, and she deleted Merle and Wendell as joint tenants.”)