Eastwood, Jayne and Francis. The opinion of the court was delivered by Eastwood, S.j.a.d.
The plaintiff appeals from an order of the Law Division, Hudson County, holding that certain moneys of a joint bank account in the Commercial Trust Company of New Jersey in the names of Michael Palovick or Stella Palovick were not the property of the defendant Stella Palovick, and vacating the levy theretofore made upon said bank account and releasing same from the lien of the levy issued upon plaintiff's judgment.
A judgment for $6,000 was recovered by plaintiff against the defendants Michael Palovick and Stella Palovick in 1938. Subsequent thereto Michael Palovick was discharged in bankruptcy. In seeking to satisfy part of the judgment, the plaintiff caused a levy to be made upon the joint bank account of $2,582.58, deposited with the Commercial Trust Company of New Jersey, standing in the names of Michael or Stella Palovick. The plaintiff having caused a levy to be made upon the moneys represented by the aforementioned bank account on an execution issued against Stella Palovick, obtained a rule to show cause, directed to Michael Palovick, Stella Palovick and the bank, why these moneys should not be paid over to the sheriff.
At the hearing on the rule, affidavits of Michael Palovick, Stella Palovick and the representative of the bank were offered by the defendants, the plaintiff waiving formal proof
and conceding that he was not in a position to controvert the statements made in the affidavits of the defendants, Michael Palovick and Stella Palovick.
The affidavits of Michael and Stella Palovick assert that the account was opened in their joint names as a convenience for the withdrawal of funds; that the defendants had been married 25 years, during which time the wife had no income of any kind; that the moneys deposited in the joint account represented moneys earned by Michael Palovick, except for $1,000 which he had received from his brother; that no part of the moneys in the account were contributed by the wife and they had no other money or bank accounts.
The appellant contends that a third-party claimant of property levied upon, seeking relief from the execution and levy, must institute a plenary action; that an execution creditor takes free of equities and secret liens; that as against a creditor, it is immaterial as to who makes the deposits in the joint account. We are convinced that the only question raised by this appeal that requires our consideration and determination is whether the moneys on deposit in the joint account, or some part thereof, were the sole and separate property of Stella Palovick and, therefore, subject to the lien of the plaintiff's levy.
The appellant contends that one who places money in such joint account whether for convenience or with some other motive, may not retrieve any of the moneys because of it having been withdrawn by his joint depositor or seized by execution creditors; that "the law considers that the one putting the money in such account is making a gift in praesenti to the other, so that the other may withdraw any or all of the money in such an account."
Our research reveals that in considering claims made against a joint account during the lifetime of both joint tenants, the decisive question is as to how the fund came into existence and whether the moneys were deposited by one or both of the joint tenants. Where the proofs establish that a depositor opened a joint bank account with another payable to either or the survivor, merely for convenience of
withdrawals and without intent to make an immediately effective gift, by retaining full ownership and absolute dominion over the account, there is no gift in praesenti. In a leading case, Stiles v. Newschwander , 140 N.J. Eq. 591 (E. & A. 1947), wherein there is a learned discussion of the issue involved in this appeal, Mr. Justice Heher, speaking for the Court of Errors and Appeals, stated:
"Neither the form nor the content of the account is, in itself, conclusive of the issue of title and ownership. Such interest (if any) as the survivor has in the deposit derives from a gift inter vivos and not from a contract between the codepositors inter se; and a gift, in turn, derives its legal efficacy solely from the intention of the donor. A donative purpose is an indispensable requisite. * * * A gift of a bank deposit in terms either of common ownership or of joint tenancy is but prima facie evidence of an ...