Alaska Supreme Court Opinions made Available byTouch N' Go Systems and Bright Solutions

Touch N' Go
, the DeskTop In-and-Out Board makes your office run smoother.


You can search the entire site. or go to the recent opinions, or the chronological or subject indices. Schacht v. Kunimune (3/15/2019) sp-7344

Schacht v. Kunimune (3/15/2019) sp-7344

          Notice:  This opinion is subject to correction before publication in the PACIFIC  REPORTER.  

          Readers are requested to bring errors to the attention of the Clerk of the Appellate Courts,  

          303 K Street, Anchorage, Alaska 99501, phone (907) 264-0608, fax (907) 264-0878, email  


                      THE SUPREME COURT OF THE STATE OF ALASKA                                    

DESMOND  E.  SCHACHT,                                              )  

                                                                   )    Supreme  Court  No.  S-16964  

                               Appellant,                          )  


                                                                   )    Superior Court No. 3AN-17-06669 CI  

          v.                                                       )  


                                                                   )    O P I N I O N  


TERRY KUNIMUNE,                                                    )  


                                                                   )    No. 7344 - March 15, 2019  

                               Appellee.                           )  




                     Appeal from the Superior Court of the State of Alaska, Third  


                     Judicial District, Anchorage, Frank A. Pfiffner, Judge.  


                     Appearances:   Robert M. Libbey, Robert M. Libbey Law  


                     Office, Anchorage, for Appellant.   David W. Pease, Burr,  


                     Pease & Kurtz,  PC, Anchorage, and D. Jason Davis, Davis  


                     Law Group, PLC, Pacific Palisades, California, for Appellee.  


                     Before: Bolger,Chief Justice, Winfree, Stowers, and Carney,  


                     Justices. [Massen, Justice, not participating.]  


                     WINFREE, Justice.  



                     A son opened joint checking and savings accounts with his father.  A few  


years later the son was injured in a car accident, settled his claim against the other driver,  


and deposited the settlement check into his joint savings account. A creditor of the father  


later levied the joint accounts and obtained approximately $90,000 - essentially all of  


it traceable to the son's settlement money - in partial satisfaction of the creditor's  

----------------------- Page 2-----------------------

judgment against the father. The son intervened in the collection action, arguing that the                                                                                                    

money should be returned to him because he was the equitable owner of the funds in the                                                                                                        


                               After the superior court's evidentiary hearing on the son's claims, but                                                                                       

before the court issued its ruling, the son sent a letter asking the court to consider                                                                                          

AS 13.33.201-.227 as supplemental legal authority.  The cited statutes provide that, in                                                                                              

 a dispute between joint account owners and creditors and absent clear and convincing   

 evidence to the contrary, the funds in a joint account generally belong to the owners in                                                                                                       

                                                                                                                         1  Without mentioning the statutes  

 accordance with their net contributions to the account.                                                                                                                            

 the son cited, the superior court subsequently held by a preponderance of the evidence  


 that the creditor could levy the joint accounts in their entireties because the financial  


 institution's account agreement the father and son signed provided that they each owned  


 the accounts "jointly and equally . . . regardless of their net contributions."  


                               Wevacatethesuperior court's decisionand remand for further proceedings  


because  we  conclude  that:                                           (1)  the  son  did  not  waive  his  argument  regarding  


AS 13.33.211's applicability; (2) the statute applies to determine the ownership interests  


 of joint account owners in a dispute involving a third-party creditor; and (3) the correct  


 standard of proof was not applied and the requisite statutory findings were not made.  




                A.             The Joint Bank Accounts  


                               In July 2013 Desmond Schacht openedjointchecking and savings accounts  


with his father, Kenneth Schacht, at Alaska USA Federal Credit Union. Desmond signed  


Alaska USA's Master Joint Account Agreement as the "member" on the accounts, and  


 Kenneth signed as the "joint owner."  Under the Agreement only the "member" was  




                               See AS 13.33.206, .211.  

                                                                                               -2-                                                                                       7344  

----------------------- Page 3-----------------------


permitted to "add, remove[,] or change the status of other joint owners after compliance  


with applicable Credit Union procedures."  The Agreement did not otherwise provide  


that the member and joint owner would have different rights with respect to the accounts.  


Regarding account ownership, the Agreement provided:  


                    [T]he member and other joint owners agree that all sums now  


                    paid  on  any  account,  or  which  may  be  paid  in  on  such  


                    accounts in the future, by any or all of the joint owners to  


                    their credit as such joint owners, together with all earnings  


                    and other additions, are and shall be owned by them jointly  


                    and equally with right of survivorship regardless of their net  


                    contributions. . . . All accounts covered by this agreement  


                    shall be subject to withdrawal or receipt by any of the joint  


                    owners, regardless of their net contributions, and payment to  


                    any of them . . . shall be valid and shall discharge the Credit  


                    Union   from   any   further   liability   for                     such   payment.  


                    (Emphases added.)  


                    In August 2016 Desmond was injured in a car accident when another driver  


crossed into his lane.  He settled his claim against the other driver, and in April 2017 he  


received a $126,000 settlement check.   He deposited the money in his joint savings  


account that same month.  Immediately before the deposit, the joint savings account's  


balance was $0 and the joint checking account's balance was $18.27.  


          B.        Creditor's Lawsuit Against Kenneth  


                    Terry Kunimune and Kenneth met in September 2011 in California to  


discuss a possible joint business venture in Alaska.  Apparently, Terry loaned Kenneth  


$120,000 in January 2012, and Kenneth signed a promissory note agreeing to repay  


Terry the full loan amount by December 31, 2012.  


                    In March 2014 Terry sued Kenneth in California for breach of contract,  


requesting the entire principal balance plus interest, attorney's fees, and costs.  Kenneth  


never participated in that case.   In June 2016 the California court entered a default  

                                                               -3-                                                         7344

----------------------- Page 4-----------------------

judgment in the amount of $161,517 - the amount of principal, pre-judgment interest,                                                                                                                                                                                                

 and allowable court costs.                                                                      Post-judgment interest began accruing at the rate of 10%                                                                                                                                     


                                                Terry filed his California judgment in the Anchorage superior court in May                                                                                                                                                                      

 2017.    He then obtained a writ of execution for $179,463.75 - the amount of the                                                                                                                                                                                                                  

 original judgment plus post-judgment interest and costs.                                                                                                                                              In July 2017 Terry served the                                                                 

 writ on Alaska USA, and Desmond and Kenneth's joint bank accounts were levied in the                                                                                                                                                                                                                

 amount   of   $89,297.13   in   partial   satisfaction   of   Terry's   judgment.    That   same   day  

 Desmond removed Kenneth as a joint account owner.                                                                                                                                             

                        C.                     Desmond's Intervention In The Creditor's Lawsuit                                                                                                                 

                                               Following the levy Desmond filed a request for bond and hearing pursuant                                                                                                                                                           

                                                             2       Desmond then filed a third-party claim and affidavit of ownership  

 to AS 09.35.130.                                                                                                                                                                                                                                                         

 stating that he was the "sole equitable owner" of the funds in the joint bank accounts that  


 had been levied.   The superior court held an evidentiary hearing over two days in  


 October and November 2017 to consider Desmond's claims.  


                                                Kenneth testified that he opened joint accounts with Desmond to help him  


 "manage  his  account[s]"  and  so  that  Kenneth  could  easily  make  deposits  to  help  


 Desmond with his expenses.  Kenneth believed when they set up the accounts that he  


 would have to go to a bank branch to transfer money if he were not a joint owner.  


 Kenneth testified that he never had a debit card or checks associated with the joint  


                        2                      AS 09.35.130 provides:                                                                

                                                If property levied upon is claimed by a third person as the                                                                                                                                           

                                               person's property . . . that person shall release the property.                                                                                                      

                                                However, the plaintiff, on demand of the person, may give                                                                                                                                        

                                               the person an undertaking executed by two sufficient sureties                                                                                                                           

                                                in a sum equal to double the value of the property levied                                                                                                                                  


                                                                                                                                                    -4-                                                                                                                                        7344

----------------------- Page 5-----------------------

accounts, set up online access for the accounts, or received monthly account statements.                                                                                                                                                                                                                                                    

He claimed he did not consider himself the owner of the funds in the joint accounts.                                                                                                                                                                                                                                             

                                                   Desmond's testimony was consistent with his father's.                                                                                                                                                         Desmond testified   

that he opened the joint accounts with the understanding that they would "provid[e] easy                                                                                                                                                                                                                                

access for funds to be transferred to [his] account[s]" by his father "for [his] support."                                                                                                                                                                                                                                                  

Desmond said his understanding was that any amounts deposited into his checking                                                                                                                                                                                                                     

account by his father were "intended for [him]," and he had "no obligation to pay [the   

money] back." Desmond also stated that he did not know about the judgment against his                                                                                                                                                                                                                                        

father or his father's business dealings with Terry.                                                                                                                                             

                                                   At the close of the evidentiary hearing, the superior court took the matter                                                                                                                                                                                  

under   advisement,   noting   it   would   research   legal   authority   relating   to   a   creditor's  

garnishment of jointly held property.  One week after the hearing, but before the court                                                                                                                                                                                                                             

had ruled on Desmond's claims, he sent the court a letter, pursuant to Alaska Civil Rule                                                                                                                                                                                                                              

                     3  citing supplemental authorities for the court to consider regarding a third-party  


creditor's rights against a non-debtor joint owner of a bank account.  Desmond cited  


AS  13.33.201-.227,4                                                                 probate  code  sections  applying  to  single-  and  multiple-party  


accounts.  This was the first time Desmond had specifically argued that AS 13.33.201- 


 .227 applied to this dispute.  Terry did not respond to the letter.  


                         3                         Alaska R. Civ. P. 77(                                                           l) ("When pertinent authorities come to the attention                                                                                                               

of a party after the party's memorandum has been filed, or after oral argument but before                                                                                                                                                                                                                       

decision, the party may promptly advise the court, by letter, with a copy to adversary                                                                                                                                                                                                            

counsel, setting forth the citations.").                                                        

                         4                         Alaska Statute 13.33.211(a) provides that, "[d]uring the lifetime of all  


parties, an account belongs to the parties in proportion to the net contribution of each to  


the sums on deposit, unless there is clear and convincing evidence of a different intent."  


It applies to "controversies between [account owners] and their creditors and other  


 successors."  AS. 13.33.206.  


                                                                                                                                                               -5-                                                                                                                                                    7344

----------------------- Page 6-----------------------

                                                       The superior court issued its findings of fact and conclusions of law in                                                                                                                                                                                                                      

 December 2017. Although it stated that "Desmond had contributed essentially all of the                                                                                                                                                                                                                                                           

 funds seized from the two joint accounts as a result of his settlement check," the court                                                                                          

 applied   the   preponderance   of   the   evidence   standard   and   held   that   the   Agreement  

 controlled the dispute.                                                                      Because the Agreement provided no limitations on Kenneth's                                                                                                                                                           

 ownership or ability to access funds in the accounts, the court held that "Terry, as                                                                                                                                                                                                                                                               

 [Kenneth's] creditor, stands in no worse position with regard to the joint account[s] and                                                                                                                                                                                                                                                     

 may garnish up to the entire amount of the funds."  The court concluded that Kenneth      

 could not, in an "attempt to limit Terry's rights as [Kenneth's] creditor," "claim a lesser                                                                                                                                                                                                                                       

 interest in the joint account[s]" than the Agreement provided.                                                                                                                                                                                            

                                                      Desmond filed a motion under Alaska Civil Rule 52(b) requesting that the                                                                                                                                                                                                                    

 superior court amend its findings. He made "specific objection[s]" to the findings of fact                                                                                                                                                                                                                                                    

 and conclusions of law that he thought were inconsistent with AS 13.33.211.                                                                                                                                                                                                                                         The court   

 denied the motion.                                                           

                                                      Desmond also filed a reconsideration motion, arguing that an American                                                                                                                                                                                          

                                                                                5  the court cited in its conclusions of law supported his position that  

 Law Reports article                                                                                                                                                                                                                                                                                                                          

 he  was  the  equitable  owner  of  the  funds.                                                                                                                                             The  superior  court  denied  Desmond's  


 reconsideration motion without explanation.  


                                                      Desmond appeals.  


                            5                         Martha   A.   Churchill,   Annotation,  Joint   Bank   Account   as   Subject   to  

Attachment,   Garnishment,   or   Execution   by   Creditor   of   One   Joint   Depositor ,   86  

 A.L.R.5th 527 (2001).                                       

                                                                                                                                                                          -6-                                                                                                                                                             7344

----------------------- Page 7-----------------------

III.          STANDARD OF REVIEW                   

                           "We review de novo questions of law, including the interpretation of a                                                                         

statute, adopting the rule of law most persuasive in light of precedent, reason, and                                                                                 



IV.          DISCUSSION  


             A.            Desmond Preserved His Argument That AS 13.33.211 Applies.  


                           Terry  argues  that  Desmond  forfeited  his  argument  that  AS  13.33.211  


applies to this dispute by failing to raise it before the superior court.  Terry correctly  


notes that Desmond referenced the statute for the first time in a letter citing supplemental  


authorities - sent pursuant to Rule 77(l) - after the evidentiary hearing had concluded.  


Terry  argues  that  Desmond's  letter  was  improper,  alleging  that  it  was  not  sent  in  


connection with a motion as required under Rule 77(l).  Terry also contends that the  


arguments in Desmond's motion requesting amendment of the superior court's findings  


and his motion for reconsideration were untimely.  

                           We reject Terry's contention that Desmond's letter was not permitted by  


Rule 77(l).  The rule permits parties to provide the superior court supplemental legal  



authority relating to a previously filed memorandumor to a point made at oral argument. 


Desmond's letter provided supplemental authority relating to both previous memoranda  


he had filed and points he had made at the evidentiary hearing.   We therefore must  


conclude that Desmond has not forfeited his argument that AS 13.33.211 applies to this  


dispute.  Forfeiture rules are based on the principle that it is unfair to the trial court and  


unjust to the opposing litigant for an appellate court to rule on a ground that was not  

             6             Toliver v. Alaska State Comm'n for Human Rights                                                         , 279 P.3d 619, 622               

(Alaska 2012) (quoting                         Alaskans For Efficient Gov't, Inc. v. Knowles                                             , 91 P.3d 273, 275          

(Alaska 2004)).   

             7             Alaska R. Civ. P. 77(l).  


                                                                                   -7-                                                                            7344

----------------------- Page 8-----------------------


presented below.                             In this case there is no such unfairness or injustice.                                                                            Desmond's  

Rule 77(             l) letter alerted the superior court to the statute's existence before the court                                                                                          

issued its findings of fact and conclusions of law.                                                                          Because Terry was permitted to                                            

                   9  to Desmond's letter and the superior court was able to consider the statute  


before ruling on his claims, he properly raised the argument before the superior court.  


This also resolves Terry's contentions that Desmond's arguments in his post-judgment  


motions were untimely.  


                B.	            Alaska Statute 13.33.211 Governs The Ownership Interests Of Joint  

                               Account Owners In A Dispute With A Third-Party Creditor.  


                                Desmond's  principal  argument  is  that  the  superior  court  erred  by  not  


applying AS 13.33.211 to find that he was the equitable owner of the funds in the  


account and ordering Terry to return the money.  We first consider whether the statute  


applies to this case.   "In interpreting a statute we 'look to the plain meaning of the  


statute, the legislative purpose, and the intent of the statute.' "10  


                                                                                                                                                   We apply a sliding-scale  


approach  where  "[t]he  plainer  the  statutory  language  is,  the  more  convincing  the  

                8              See Harvey v. Cook                               , 172 P.3d 794, 802 (Alaska 2007) ("[P]ermitting a                                                                       

party to claim error regarding a claim not raised and litigated below 'is both unfair to the                                                                                                         

trial court and unjust to the opposing litigant.' " (quoting                                                                         In re Marriage of Walker                                   , 138   

Cal. App. 4th 1408, 1418 (2006))); 5 A                                                      M. J   UR. 2         D  Appellate Review                            574 (2018) ("[I]t              

is fundamentally unfair to fault the trial court for failing to rule correctly on an issue it                                                                                       

was never given the opportunity to consider.").                                     

                9               Rule 77(l) provides that "[a]ny response must be made promptly."  


                10             State, Dep't of Commerce, Cmty. & Econ. Dev., Div. of Ins. v. Alyeska  


Pipeline Serv. Co., 262 P.3d 593, 597 (Alaska 2011) (quoting Premera Blue Cross v.  


State, Dep't of Commerce, Cmty. & Econ. Dev., Div. of Ins., 171 P.3d 1110, 1115  


(Alaska 2007)).  


                                                                                                   -8-	                                                                                         7344

----------------------- Page 9-----------------------


evidence of contrary legislative purpose or intent must be" to rebut that meaning.                                                               For  


a statute based on a uniform act,                                                                                                                    

                                                             official comments are "of persuasive assistance" in  



interpreting the act, but are not "controlling." 


                       Alaska Statute 13.33.211(a) provides that, "[d]uring the lifetime of all  

                                                                                                                                      [14]  of each  


parties, an account belongs to the parties in proportion to the net contribution 

to the sums on deposit, unless there is clear and convincing evidence of a different  


intent."  The statute defines "account" as a "contract of deposit between a depositor and  


            11         Id.  (quoting  Gov't Emp. Ins. Co. v. Graham-Gonzalez                                          , 107 P.3d 279, 284         

(Alaska 2005)).   

            12         Alaska Statutes 13.33.201-.227 went into effect in 1996 as part of the  


Alaska legislature's enactment of the revised Uniform Probate Code. Ch. 75,  13, SLA  


 1996.  The section of the Uniform Probate Code that was enacted as AS 13.33.201-.227  


is also known as the Uniform Multiple-Person Accounts Act. See UNIF . P                                                        ROBATE  CODE  


 6-201 to -227 (U                NIF . L    AW  COMM'N   1989).   

            13         ABMEscrowClosing &Consulting, Inc.v. MatanuskaMaid, Inc. , 659 P.2d  


 1170, 1172 (Alaska 1983) (quoting Morrow v. New Moon Homes, Inc., 548 P.2d 279,  


287 n.24 (Alaska 1976)).  


            14         "Net contribution" means  


                       the sum of all deposits to an account made by or for the party,  


                       less all payments from the account made to or for the party  


                       that have not been paid to or applied to the use of another  


                       party and a proportionate share of any charges deducted from  


                       the account,  plus a proportionate share of any  interest or  


                       dividends  earned,  whether  or  not  included  in  the  current  




AS 13.33.211(d).  


                                                                         -9-                                                                   7344

----------------------- Page 10-----------------------

                                          15                                                                                16  

a    financial    institution"                 and   includes    "multiple-party    account[s],"                                 which    are  

"account[s] payable on request to one or more of two or more parties whether or not a                                                              

                                                               17    Desmond and Kenneth's joint accounts were  

right of survivorship is mentioned."                                                                                                        

"accounts"under AS13.33.201becausetheywere"contract[s]ofdeposit between"them  


and Alaska USA that were "payable on request to" either of them.18   The statute applies  


to disputes between the joint account owners and their creditors,19  but not to disputes  


between account owners20  or between account owners and their financial institution.21  


                       After examining the statute's plain language, we conclude that the statute  


applies to determine the ownership of joint account funds in disputes, such as the one in  


this case, between a creditor and an owner of a joint bank account.  Consistent with our  


            15         AS   13.33.201(1).  

            16         AS  13.33.203(a)  ("An  account  may  be  for  a  single  party  or  multiple  parties.   

A  multiple-party  account  may  be  with  or  without a  right  of  survivorship  between  the  


            17         AS   13.33.201(5).  

            18         See  AS   13.33.201(1),  (5).  

            19         AS   13.33.206   ("The  provisions   of  AS   13.33.211-13.33.216   concerning  

beneficial  ownership  as  between  parties  or  as  between  parties  and  beneficiaries  apply  

only to   controversies  between  those  persons   and  their   creditors   and   other   successors  

.  .  .  .").  

           20          See UNIF .  PROBATE  CODE    6-211  cmt.  (UNIF .  LAW  COMM'N   1989)  ("The  


section   does   not   undertake   to   describe   the   situation   between   parties   if   one   party  

withdraws  more  than  that  party  is  then  entitled  to as against  the  other  party.  .  .  .  Rights  

between  parties  in  this  situation  are  governed  by  general  law  other  than  this  part.").  

           21          Id. (" 'Net contribution' as defined by subsection (a) has no application to  


the financial institution-depositor relationship.").  


                                                                      -10-                                                                 7344

----------------------- Page 11-----------------------


precedent,              the statute implicitly recognizes a distinction between account ownership                                                      

and   ownership   of   the   money   in   an   account.     The   statute   contemplates   that   some  

                                                                                                    23 yet it still provides that in a dispute  

"accounts" will be payable to more than one owner,                                                                                                           

between account owners and a creditor those accounts "belong[] to [the account owners]  


in proportion to the net contribution of each," absent "clear and convincing evidence"  


that the owners had a different intent.24   "[B]elongs to" in this context refers to equitable,  


not legal, ownership of the funds in an account.25  


                           This  interpretation  is  also  compelled  by  AS  13.33.206's  limitation  on  


subsection .211's scope and our reluctance to adopt "statutory constructions that reach  


absurd results."26  Alaska Statute 13.33.206 provides that subsection .211's provisions  


concerning  the beneficial  ownership  of joint accounts "apply  only  to  controversies  


between  [beneficial  account  owners]  and  their  creditors  and  other  successors."  


(Emphasis added.)  Subsection .211 does not determine a joint account owner's rights  

             22           See von Gemmingen v. First Nat'l Bank of Anchorage                                                            , 890 P.2d 60, 63              

(Alaska 1995) (recognizing that "judgment debtors may not have a right to all of the                                                                                 

money deposited to [an] account").                

             23           See AS  13.33.203(a).  


             24           See AS  13.33.211(a).  


             25           See Unif. Probate Code  6-211 cmt. (noting that this subsection reflects  


assumption that joint owners of a bank account "usually intend[] no present change of  


beneficial ownership" of funds in the account); see also Craig v. Hastings State Bank,  


380 N.W.2d 618, 622-23 (Neb. 1986) ("No reasonable person would attach a meaning  


for 'belongs to[]' . . . other than 'to be the property of' a person." (quoting WEBSTER 'S  



             26           Premera  Blue Cross v. State,  Dep't of Commerce,  Cmty.  & Econ.  Dev.,  Div.  

of  Ins.,   171  P.3d   1110,   1120  (Alaska  2007).  

                                                                                  -11-                                                                           7344

----------------------- Page 12-----------------------

                                        27                                                                      28  

against a co-owner                          or against a financial institution.                                      It consequently is difficult to                           

imagine cases in which subsection .211 would apply if not for disputes, like this one,                                                                                     

between a joint account owner and a creditor. Interpreting the statute to not apply to this                                                                                 

situation risks turning it into a nullity.                                     29  

                            We  note  that,  although  this  is  an  issue  of  first  impression  for  us,  


distinguishing between the legal and equitable interests of joint bank account owners is  


consistent with the majority practice of courts around the country and with existing  


Alaska law. We have identified appellate courts in at least 29 states that have made such  


a distinction.  In 12 states, appellate courts have applied their versions of the Uniform  


Multiple-Person Accounts Act to determine a creditor's right to garnish funds from joint  


bank  accounts.30                      In  another  17  states,  appellate  courts  have  applied  common  law  


              27            UNIF . P        ROBATE   CODE    6-211 cmt. ("The section does not undertake to                                                                   

describe the situation between parties if one party withdraws more than that party is then                                                                                 

entitled to as against the other party.").                      

              28            Id. (" 'Net contribution' as defined by subsection (a) has no application to  


the financial institution-depositor relationship.").  


              29            See   Premera   Blue   Cross,   171   P.3d   at   1120   (declining   to   adopt  


interpretation of statute that would render statute "a nullity").  


              30            See Harvey v. Harvey, 841 P.2d 375, 378 (Colo. App. 1992); Lamb v.  


 Thalimer Enters., Inc., 386 S.E.2d 912, 914 (Ga. App. 1989); Browning &Herdrich Oil  


 Co. v. Hall, 489 N.E.2d 988, 991-92 (Ind. App. 1986); Brown v. Commonwealth, 40  


S.W.3d 873, 881-82 (Ky. App. 1999); Szelenyi v. Miller, 564 A.2d 768, 770-71 (Me.  


 1989); Enright v. Lehmann, 735 N.W.2d 326, 331 (Minn. 2007); Craig, 380 N.W.2d at  


622-23; Alcantar v. Sanchez , 257 P.3d 966, 972 (N.M. App. 2011); Deutsch, Larrimore  


& Farnish, P.C. v. Johnson, 848 A.2d 137, 142-43 (Pa. 2004); RepublicBank Dallas v.  


Nat'l Bankof Daingerfield, 705S.W.2d 310, 311-12 (Tex. App. 1986)(interpreting prior  


Texas Probate Code Ann.  438(a) (1979), which has been reenacted as Texas Estates  


Code Ann.  113.102 (2012)); In re Estate of Maxfield, 856 P.2d 1056, 1059 (Utah  


 1993); Lewis v. House, 348 S.E.2d 217, 219 (Va. 1986).  


                                                                                     -12-                                                                                7344

----------------------- Page 13-----------------------

principles or other state statutes to allow joint account owners to establish their equitable                                                                                                                               

ownership of joint account funds in response to a creditor's garnishment action.                                                                                                                                                   31  

                                      The State already has interpretedAS13.33.211 toapplyto actions in which  


the Department of Revenue, Child Support Services Division seizes joint bank accounts  


to  satisfy  past-due  child  support  obligations.32                                                                                               In  those  situations,  the  Division  


"apportion[s]  money  among  the  joint  owners  in  accordance  with  AS  13.33.211."33  


Differentiating between legal and equitable ownership of the funds in joint accounts is  


also consistent with Alaska cases recognizing that it is possible for a joint owner of  


property to commit a crime if that owner infringes on another owner's interest in the  


property.34                          Those  cases  implicitly  recognize  that  legal  title  does  not  conclusively  


                   31                 See Amarlite Architectural Prod., Inc. v. Copeland Glass Co.                                                                                                                  , 601 So. 2d               

414, 416 (Ala. 1992);                                         Hayden v. Gardner                                       , 381 S.W.2d 752, 753 (Ark. 1964);                                                                  Tinsley v.   

Bauer, 271 P.2d 116, 121 (Cal. Dist. App. 1954);                                                                                             Antuna v. Dawson                                     , 459 So. 2d 1114,                  

 1116-17 (Fla. Dist. App. 1984);                                                           Traders Travel Int'l, Inc. v. Howser                                                                 , 753 P.2d 244, 248                         

(Haw. 1988);                            Highsmith v. Dep't of Pub. Aid                                                              , 803 N.E.2d 652, 657 (Ill. App. 2004);                                                        

 Walnut Valley State Bank v. Stovall                                                                , 574 P.2d 1382, 1386 (Kan. 1978);                                                                  Morgan Stanley   

 &Co. v. Andrews                                  , 123 A.3d 640, 650 (Md. Spec. App. 2015);                                                                                 Danielson v. Lazoski                                       , 531   

N.W.2d 799, 802 (Mich. App. 1995);                                                                          Delta Fertilizer, Inc. v. Weaver                                                          , 547 So. 2d 800,                  

 802-03 (Miss. 1989);                                         Esposito v. Palovick                                        , 101 A.2d 568, 572 (N.J. Super. App. Div.                                                                     

 1953);  Jimenez v. Brown                                              , 509 S.E.2d 241, 246 (N.C. App. 1998);                                                                              Baker v. Baker                              , 710   

P.2d 129, 134 (Okla. Civ. App. 1985);                                                                           Greenwood v. Beeson                                            , 454 P.2d 633, 636 (Or.                                   

 1969);  Barrup v. Barrup                                            , 111 A.3d 414, 422 (Vt. 2014);                                                         Fireman's Fund Ins. Co. v. Nw.                                                

Paving & Const. Co.                                        , 891 P.2d 747, 749-50 (Wash. App. 1995);                                                                                  Hancock v. Stockmens              

Bank & Tr. Co.                              , 739 P.2d 760, 762-63 (Wyo. 1987).                                                    

                   32                 See  15 Alaska Administrative Code 125.463(f) (2018).  


                   33                 Id.  

                   34                 See Hughes v. State, 56 P.3d  1088, 1094 (Alaska App. 2002) (affirming  


defendant's conviction for criminal mischief for damaging the property of another even  


though the defendant was the co-owner of the property at issue); LaParle v. State, 957  



                                                                                                                     -13-                                                                                                               7344

----------------------- Page 14-----------------------


establish an owner's right to exercise the entire "bundle"                                                                                        of rights accompanying     

property ownership.   

                                In summary, courts considering a challenge by a joint account owner to a                                                                                                 

creditor's levying of funds from a joint account presumptively must apply AS 13.33.211                                                                                               

                                                                                      36  of each account owner to determine the amount  

and calculate the "net contributions"                                                                                                                                                     

of funds subject to levy.  A creditor can, in turn, rebut the presumption that joint owners  


own the account in accordance with their net contributions by providing "clear and  


convincing evidence of a different intent."37  


                C.	            We Remand To Allow The Superior Court To Make Findings Under  


                                The Correct Standard Of Proof.  


                               Having   determined   that   the   superior   court   should   have   applied  


AS  13.33.211,  we  must  vacate  the  court's  conclusions  and  remand  the  case  for  


appropriate findings and application of the correct legal standard.38  


                                                                                                                                                                The superior court  

                34              (...continued)  


P.2d 330, 333-34 (Alaska App. 1998) (affirming defendant's conviction for theft of  


marital assets); cf. State v. Gagne, 79 A.3d 448, 456 (N.H. 2013) ("The fact that the  


defendant did not need the victim's permission in order to withdraw funds from the  


account, however, does not mean that the defendant was privileged to appropriate the  


victim's interest in those funds.").  

                35              63C AM. J                UR. 2       D  Property    1 (2018) (footnotes omitted) ("A common                                                           


idiom describes property as a 'bundle of sticks,' - a collection of individual rights                                                                                                         

which, in certain combinations, constitute property, and which . . . can be divided in                                                                                             

terms of dimension, duration, and scope.").                                       

                36             AS  13.33.211(d).  


                37             AS  13.33.211(a).  


                38             See Roberson v. Manning, 268 P.3d 1090, 1093 (Alaska 2012) (vacating  


and remanding because "additional findings of fact [we]rerequired to correctly apply the  



                                                                                                 -14-	                                                                                          7344

----------------------- Page 15-----------------------

made all of its findings under the lower "preponderance of the evidence" standard, rather                                                              

than the "clear and convincing" standard required by AS 13.33.211(a).  And the court                                                                    

made   no   factual   findings   about   Desmond's   and   Kenneth's   intents   as   the   statute  

                39  On remand the court should determine whether Terry established by clear and  


convincing evidence that Desmond's and Kenneth's intents rebutted AS 13.33.211(a)'s  


ownership presumption.  In making findings about intent, the court should consider the  


parties'  testimony  about  their  intents,  the  Agreement,  and  any  "extrinsic  evidence  


regarding  the  parties'  intent  at  the  time  the  contract  was  made."40                                                         "The  extrinsic  


evidence that may be considered includes 'the language and conduct of the parties, the  


objects sought to be accomplished and the surrounding circumstances at the time the  


contract was negotiated,' as well as the conduct of the parties after the contract was  


entered into."41  


            D.	          Desmond Did Not Waive AS 13.33.211's Application By Signing The  


                         Agreement, And The Legal Authority Terry Cites Is Distinguishable  


                         From This Case.  


                         Terry appears to argue that - even if AS 13.33.211 applies - we can  


affirm the superior court's decision because (1) by signing the Agreement, Desmond  


            38           (...continued)  


law"); cf. Veselsky v. Veselsky, 113 P.3d 629, 634 n.16 (Alaska 2005) ("We have held  


that the trial court, not this court, is in the best position to judge witnesses' credibility  


and evaluate their testimony.").  

            39           See AS 13.33.211(a) (providing that "an account belongs to the parties in  


proportion to the net contribution of each . . . unless there is clear and convincing  


evidence of a different intent").  


            40           Fairbanks N. Star Borough v. Tundra Tours, Inc., 719 P.2d 1020, 1024  


(Alaska 1986) (citing Norton v. Herron, 677 P.2d 877, 879-80 (Alaska 1984)).  


            41           Nautilus Marine Enters., Inc. v. Exxon Mobil Corp., 305 P.3d 309, 316  


(Alaska 2013) (quoting Peterson v. Wirum, 625 P.2d 866, 870 n.7 (Alaska 1981)).  


                                                                             -15-	                                                                      7344

----------------------- Page 16-----------------------

waived any rights that AS 13.33.211 might have provided him, and (2)                                                               von Gemmingen   


v.  First National Bank of Anchorage                                                                                                                      

                                                                        and several out-of-state cases require us to hold  


that the Agreement controls Desmond's and Kenneth's ownership interests in the joint  


accounts.  We disagree for the reasons detailed below.  


                         1.	         Desmond  did  not  knowingly  and  voluntarily  agree  to  waive  


                                     AS 13.33.211's application by signing the Agreement.  


                         Terry argues that parties to acontract can waivestatutoryprotections, citing  


several  Alaska  cases  in  which  he  claims  we  found  such  waivers  were  valid  and  


enforceable.               He  claims  that  Desmond  waived  any  rights  he  may  have  had  under  


AS 13.33.211 by signing the Agreement.  Terry is correct that "parties may agree to  


waive statutory rights unless a question of public policy is involved, or where rights of  



third parties, which the statute was intended to protect, are involved."                                                              However such  



waivers "must be knowing and voluntary."                                               We agree with Desmond that, if he did  


waive  any  rights,  he  did  not  do  so  knowingly;  the  Agreement  does  not  reference  


AS 13.33.211, waiver, equitable ownership, or the rights of third-party creditors.  And  


the cases Terry cites are not relevant to this dispute; in each case, a party or a party's  


representative agreed to waive statutory rights knowingly and voluntarily in the course  



of a negotiation. 

            42	          890 P.2d 60 (Alaska 1995).              

            43           See   Ramsey   v.  City   of   Sand   Point,   936   P.2d   126,   130   (Alaska   1997)  

(quoting 17A A                M. J   UR. 2     D   Contracts   256, at 259-60 (1991)).               

            44           Deptula v. Simpson                   , 164 P.3d 640, 644 (Alaska 2007);                                 see also Ramsey                ,  


936 P.2d at 130 (describing waiver as "the intentional relinquishment of a known right"  

(quoting  Milne v. Anderson                         , 576 P.2d 109, 112 (Alaska 1978))).                  

            45           See Ramsey, 936 P.2d at 130-31 (upholding police chief's agreement to  


waive statutory "just cause" termination protections in exchange for six months of  



                                                                             -16-	                                                                      7344

----------------------- Page 17-----------------------

                        2.	         The cases Terry cites requiring courts to look solely to account                                        

                                    agreements to determine a debtor's ownership interest in an                                                       

                                    account are inapposite.     

                        Terry contends that                 von Gemmingen                 46  


                                                                                               stands for the proposition that an  


 account agreement like the Agreement in this case determines a debtor's interest in a  


levied account.   He also cites out-of-state cases that he contends stand for the same  


proposition.  But von Gemmingen is distinguishable from this case.  In von Gemmingen  



the accounts at issue were escrow accounts,                                     not joint bank accounts, and there were no  


relevant statutory provisions, as there are here, dictating the parties' ownership interests  


in a dispute with creditors.  More importantly, we recognized in von Gemmingen that  



 "judgment debtors may not have a right to all of the money deposited to the account," 


 and a "judgment creditor may attach only property actually owned by the judgment  



                   In this case a statute controls how a court should determine what property the  


judgment debtor "actually owns."  


                        None of the out-of-state cases Terry cites in his brief supports his argument  


that an account agreement conclusively establishes owners' interests in a joint account.  


 Wagner v. State stands for the opposite proposition; the Maryland Court of Appeals did  

            45          (...continued)  


 severance pay); Deptula, 164 P.3d at 645 (holding that home buyer's waiver of statutory  


 disclosure  rights  pursuant  to  "unambiguous"  waiver  agreement  was  valid  and  


 enforceable); Blackburn v. State, Dep't of Transp. & Pub. Facilities, 103 P.3d 900, 905  

 (Alaska 2004) (holding that union's waiver of member's statutory arbitration rights in  


 collective bargaining agreement was valid and enforceable).  

            46          890  P.2d  at  64.  

            47          See  id.  at  63.  

            48          Id.  

            49          Id.  

                                                                          -17-	                                                                   7344

----------------------- Page 18-----------------------

find that         an  agreement controlled a dispute between co-owners, but it was an informal                                                   

verbal agreement between co-owners about their intent in opening the account, not the                                                                                      

                                                       50  The court in Wagner upheld the joint account owner's theft  

formal account documents.                                                                                                                                                

                                                                                                                                       51   In Signature Bank  

conviction because of unauthorized withdrawals from the account.                                                                                                       


v. HSBC Bank USA, N.A. the New York Supreme Court Appellate Division upheld a  


creditor's right to levy an entire joint bank account, but only because the joint owners  


failed  to  "provid[e]  direct  proof  that  no  joint  tenancy  was  intended  or  substantial  


circumstantial proof that the joint account had been opened for convenience only."52   In  


New York joint account owners are permitted to provide extrinsic evidence to rebut an  


initial presumption that a joint account is a "joint tenancy."53   In the last case Terry cites,  


Fleet Bank Connecticut, N.A. v. Carillo, the Connecticut Supreme Court reached its  


result  by  relying  on  the  state's  bank  protection  laws,  not  the  parties'  account  


documents,54  and the case represents a minority position that we decline to follow.55  


              50           See  128 A.3d 1, 19 (Md. App. 2015) ("[T]he titling of the Account, listing                                                               

Father and Wagner as 'joint owners,' did not create an ownership interest in the funds   

in the Account, as Father and Wagner agreed that the funds belonged to Father.").                                                                    

              51           Id. at 20.  


              52            889 N.Y.S.2d 242, 244 (N.Y. App. Div. 2009) (quoting Fragetti v Fragetti,  


692 N.Y.S.2d 442, 443 (N.Y. App. Div. 1999)).  


              53           See Viggiano v. Viggiano, 523 N.Y.S.2d 874, 875 (N.Y. App. Div. 1988)  


(holding that account was a "convenience account" because owner rebutted presumption  


that joint account was intended).  


              54            691 A.2d 1068, 1072 (Conn. 1997).  


              55           See Morgan Stanley & Co. v. Andrews, 123 A.3d 640, 647 n.8 (Md. Spec.  


App. 2015) (declining to follow Fleet Bank as "an outlier with respect to garnishability  


of jointly[]titled accounts").  


                                                                                     -18-                                                                              7344

----------------------- Page 19-----------------------

                     E.                   We Decline to Determine The Correct Fund-Tracing Method.                                                                                                                            

                                          Desmond also argues in his brief that, to determine a joint owner's "net                                                                                                                                                  

contributions" under AS 13.33.211, we should adopt fund-tracing methods that Texas   

courts have used.                                       Because the superior court found that Terry was entitled to levy all of                                                                                                                                            

the money in the joint accounts, it did not trace the funds in the accounts to determine                                                                                                                                                         

Desmond's   and   Kenneth's   respective   ownership   interests   according   to   their   net  

contributions.   Accordingly, the issue of the correct fund-tracing method to use in these                                                                                                                                                                       

circumstances is not properly before us, and we decline to consider it.                                                                                                                                                      56  

V.                   CONCLUSION  

                                          Thesuperior court's decision with respect to Desmond's ownershipinterest  


in the joint bank accounts is VACATED and this case is REMANDED for further  


proceedings consistent with this opinion.  


                     56                    Cf. Nelson v. Municipality of Anchorage                                                                                      , 267 P.3d 636, 645 (Alaska 2011)                                                      

(holding that plaintiff's claim was not ripe for review because he had not yet litigated his                                                                                                                                                                            

claim below).   

                                                                                                                                  -19-                                                                                                                            7344

Case Law
Statutes, Regs & Rules

IT Advice, Support, Data Recovery & Computer Forensics.
(907) 338-8188

Please help us support these and other worthy organizations:
Law Project for Psychiatraic Rights