Virginia Law

Article 2. Multiple-Party Accounts.

As used in this article, unless the context requires a different meaning:

"Account" means 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 similar arrangements.

"Beneficiary" means a person named in a trust account as one for whom a party to the account is named as trustee.

"Fiduciary" shall include any one or more of the following: (i) a fiduciary as defined in § 8.01-2, (ii) an agent under a power of attorney, or (iii) an attorney acting under an attorney-client relationship.

"Fiduciary account" means (i) an estate account for a decedent, (ii) an account established by one or more agents under a power of attorney or an existing account of a principal to which one or more agents under a power of attorney are added, (iii) an account established by one or more conservators, (iv) an account established by one or more committees, (v) a regular trust account under a testamentary trust or a trust agreement that has significance apart from the account, or (vi) an account arising from a fiduciary relationship such as an attorney-client relationship. "Fiduciary account" does not include a trust account.

"Financial institution" means any entity authorized to do business under state or federal laws relating to financial institutions that is authorized to establish accounts, including, without limitation, banks, trust companies, savings institutions, and credit unions.

"Joint account" means an account payable on request to one or more of two or more parties whether or not mention is made of any right of survivorship.

"Multiple-fiduciary account" means a fiduciary account where more than one fiduciary is authorized to act.

"Multiple-party account" means any of the following types of account: (i) a joint account, (ii) a P.O.D. account, or (iii) a trust account. The term does not include accounts established for deposit of funds of a partnership, joint venture, or other association for business purposes, or accounts controlled by one or more persons as the duly authorized agent or trustee for a corporation, unincorporated association, or charitable or civic organization.

"Net contribution" of a party to a joint account as of any given time is the sum of all deposits thereto made by or for him, less all withdrawals made by or for him which have not been paid to or applied to the use of any other party, plus a pro rata share of any interest or any dividends included in the current balance. The term includes, in addition, any proceeds of deposit life insurance added to the account by reason of the death of the party whose net contribution is in question.

"Party" means a person who, by the terms of the account, has a present right, subject to request, to payment from a multiple-party account, including a fiduciary account. The term includes a P.O.D. payee or beneficiary of a trust account only after the account becomes payable to him by reason of his surviving the original payee or trustee. The term includes a guardian, conservator, personal representative, or assignee, including an attaching creditor, of a party. The term also includes a person identified as a trustee of an account for another whether or not a beneficiary is named, but it does not include any named beneficiary unless he has a present right of withdrawal.

"Payment," with respect to sums on deposit, includes withdrawal, payment on check or other directive of a party, and any pledge of sums on deposit by a party and any setoff, or reduction or other disposition of all or part of an account pursuant to a pledge.

"P.O.D. account" means an account payable on request to one person during his lifetime and on his death to one or more P.O.D. payees, or to one or more persons during their lifetimes and on the death of all of them to one or more P.O.D. payees.

"P.O.D. payee" means a person designated on a P.O.D. account as one to whom the account is payable on request after the death of one or more persons.

"Proof of death" includes a death certificate; a certificate of qualification upon a decedent's estate; or an authenticated copy of any record or report of a governmental agency, domestic or foreign, that a person is dead.

"Request" means a proper request for withdrawal, or a check or order for payment, that complies with all conditions of the account, including special requirements concerning necessary signatures and regulations of the financial institution. If the financial institution conditions withdrawal or payment on advance notice, for purposes of this article the request for withdrawal or payment is treated as immediately effective and a notice of intent to withdraw is treated as a request for withdrawal.

"Sums on deposit" means the balance payable on a multiple-party account, including a fiduciary account, including interest, dividends, and in addition any deposit life insurance proceeds added to the account by reason of the death of a party.

"Trust account" means an account in the name of one or more parties as trustee for one or more beneficiaries where the relationship is established by the form of the account and the deposit agreement with the financial institution and there is no subject of the trust other than the sums on deposit in the account, without regard to whether payment to the beneficiary is mentioned in the deposit agreement. The term does not include a fiduciary account.

"Withdrawal" includes payment to a third person pursuant to check or other directive of a party.

1979, c. 407, § 6.1-125.1; 2010, c. 794; 2020, c. 259.

A. The provisions of §§ 6.2-606, 6.2-607, and 6.2-608 concerning beneficial ownership as between parties, or as between parties and P.O.D. payees or beneficiaries of multiple-party accounts, are relevant only to controversies between these persons and their creditors and other successors, and have no bearing on the power of withdrawal of these persons as determined by the terms of account contracts.

B. The provisions of §§ 6.2-612 through 6.2-617 govern the liability of financial institutions that make payments pursuant thereto, and their set-off rights, but shall have no effect on the beneficial ownership of or the power of withdrawal from the accounts between the parties or P.O.D. payees or beneficiaries of multiple-party accounts and shall have no effect on the fiduciary duties or obligations of fiduciaries under the governing instrument of multiple-fiduciary accounts.

1979, c. 407, § 6.1-125.2; 2010, c. 794; 2020, c. 259.

A. A joint account belongs, during the lifetimes of all parties, to the parties in proportion to the net contributions by each to the sums on deposit, except that a joint account between persons married to each other shall belong to them equally, and unless, in either case, there is clear and convincing evidence of a different intent.

B. A P.O.D. account belongs to the original payee during his lifetime and not to any P.O.D. payee. If two or more parties are named as original payees, during their lifetimes rights as between them are governed by subsection A.

C. Unless (i) a contrary intent is manifested by the terms of the account or the deposit agreement or (ii) there is other clear and convincing evidence of an irrevocable trust, a trust account belongs beneficially and absolutely to the trustee during his lifetime. If two or more parties are named as trustee on the account, during their lifetimes beneficial rights as between them are governed by subsection A. If there is an irrevocable trust, the account belongs beneficially to the beneficiary.

D. Upon an order of garnishment, attachment, or other levy addressed to a party to a joint account as mentioned in subsection A, or a trust account as mentioned in subsection C, the financial institution shall:

1. File an answer setting forth the form of account, whether it has funds responsive to the process, and such information as it has as to the names and addresses of the parties to the account;

2. Send a copy of such answer by first class mail to the petitioning creditor or counsel of record;

3. From the time of service of such garnishment, attachment or levy, hold the amount subject to such garnishment, attachment or levy, or such lesser amount or sum as it may have, which amount shall be set forth in its answer; and

4. Not permit any person to draw against such amount whether by check against such account or otherwise.

E. If the petitioning creditor shall desire to pursue the question of ownership of such funds held subject to the claim of two or more parties to the deposit account, it shall (i) provide the clerk of the court that issued the order of garnishment, attachment, or other levy with a copy of the documents originally served on the original defendants or judgment defendants and (ii) request the clerk to issue a summons accompanied by such copy with a copy of a notice to co-depositors containing substantially the following information: "Attached is a copy of the documents served on a financial institution to cause it to withhold money from an account in which you may have an interest. If you wish to protect your interests, you or your attorney should take appropriate legal action promptly."

F. Upon payment of the appropriate fees, the clerk shall issue such summons to be served on any other party having an interest or apparent interest in such account. Service on a party to the account made at the address on record at the financial institution shall be presumed to be proper service for the purposes of this section. In addition, a copy of such summons and notice shall be issued and served on or mailed to both the financial institution and the original defendant or judgment debtor. If such summons is received either by certified or registered mail or acknowledged in writing within 21 days on or by such financial institution, it shall continue to hold such funds pending further order of the court. If such financial institution is not served with, or does not acknowledge, such an order within 21 days from the filing of such answer, it may treat the garnishment, attachment or levy, insofar as it relates to such joint or trust accounts, as terminated on the twenty-second day and being of no further force or effect.

G. The court shall allow the financial institution its reasonable expenses in responding to discovery of its records and may condition any such discovery upon prepayment of such expenses.

H. Orders to withhold and deliver issued by the Department of Social Services shall be complied with as provided in §§ 63.2-1929 and 63.2-1931.

1979, c. 407, § 6.1-125.3; 1982, c. 302; 1983, c. 531; 1987, c. 296; 1988, cc. 368, 547; 1990, c. 950; 2010, c. 794.

Upon the entry of a decree of divorce, either a mensa et thoro or a vinculo matrimonii, all rights of either consort in any multiple-party account then existing between them, including the right of survivorship, shall be extinguished; and any joint account then existing between the consorts shall thereupon be converted into a tenancy in common, in the proportions provided in subsection A of § 6.2-606, unless otherwise ordered by the court.

1979, c. 407, § 6.1-125.4; 2010, c. 794.

A. Sums remaining on deposit at the death of a party to a joint account belong to the surviving party as against the estate of the decedent unless there is clear and convincing evidence of a different intention at the time the account is created. If there are two or more surviving parties, their respective ownerships during their lifetime shall be in proportion to their previous ownership interests under § 6.2-606 augmented by an equal share for each survivor of any interest the decedent may have owned in the account immediately before his death; and the right of survivorship continues between the surviving parties.

B. If the account is a P.O.D. account:

1. On the death of one of two or more original payees, the rights to any sums remaining on deposit are governed by subsection A;

2. On the death of the sole original payee or of the survivor of two or more original payees, any sums remaining on deposit belong to the P.O.D. payee or payees if surviving, or to the survivor of them if one or more die before the original payee. If two or more P.O.D. payees survive, there is no right of survivorship in the event of death of a P.O.D. payee thereafter unless the terms of the account or deposit agreement expressly provide for survivorship between them.

C. If the account is a trust account:

1. On the death of one of two or more trustees, the rights to any sums remaining on deposit are governed by subsection A;

2. On the death of the sole trustee or the survivor of two or more trustees, any sums remaining on deposit belong to the persons named as beneficiaries, if surviving, or to the survivor of them if one or more die before the trustee, unless there is clear evidence of a contrary intent. If two or more beneficiaries survive the death of the sole trustee or the last survivor of two or more trustees, there is no right of survivorship in the event of death of any beneficiary thereafter unless the terms of the account or deposit agreement expressly provide for survivorship between them.

D. In other cases, the death of any party to a multiple-party account has no effect on beneficial ownership of the account other than to transfer the rights of the decedent as part of his estate. If the terms of the account clearly indicate that there is no right of survivorship, the estate of a decedent party shall succeed to the rights of decedent in such account.

E. A right of survivorship arising from the express terms of the account or under this section, a beneficiary designation in a trust account, or a P.O.D. payee designation, cannot be changed by will.

1979, c. 407, § 6.1-125.5; 1981, c. 53; 2010, c. 794.

The provisions of § 6.2-608 as to rights of survivorship are determined by the form of the account at the death of a party. This form may be altered by written order given by a party to the financial institution to change the form of the account or to stop or vary payment under the terms of the account. The order or request shall be signed by a party, received by the financial institution during the party's lifetime, and not countermanded by other written order of the same party during his lifetime.

1979, c. 407, § 6.1-125.6; 2010, c. 794.

Any transfers resulting from the application of § 6.2-608 are effective by reason of the account contracts involved and this article and are not to be considered as testamentary or subject to Chapter 4 (§ 64.2-400 et seq.) of Title 64.2.

1979, c. 407, § 6.1-125.7; 2010, c. 794.

A. If the assets of a deceased party's estate, other than the assets in a multiple-party account, are not sufficient to pay the debts, taxes, and expenses of estate administration, including statutory allowances to the surviving spouse, minor children, and dependent children, no transfer of account funds, to which the deceased party was beneficially entitled immediately before his death, shall be effective, by virtue of a party's survivorship of the decedent, against the estate of such deceased party to the extent such funds are needed to pay such liabilities of the estate.

B. A surviving party, P.O.D. payee, or beneficiary who receives payment from a multiple-party account after the death of a deceased party shall be liable to account to his personal representative for amounts the decedent owned beneficially immediately before his death to the extent necessary to discharge the claims and charges described in subsection A that remain unpaid after application of the decedent's estate. No proceeding to assert this liability shall be commenced (i) unless the personal representative has received a written demand by a surviving spouse, a creditor, or one acting for a minor or dependent child of the decedent and (ii) later than two years following the death of the decedent. Sums recovered by the personal representative shall be administered as part of the decedent's estate.

C. This section shall not affect the right of a financial institution to make payment on multiple-party accounts according to the terms thereof, or make it liable to the estate of a deceased party unless, before payment, the institution has been served with process in a proceeding by the personal representative.

1979, c. 407, § 6.1-125.8; 2010, c. 794.

A. Financial institutions may enter into multiple-party accounts to the same extent that they may enter into single-party accounts. Any multiple-party account may be paid, on request, to any one or more of the parties. A financial institution shall not be required to inquire as to the source of funds received for deposit to a multiple-party account, or to inquire as to the proposed application of any sum withdrawn from an account, for purposes of establishing net contributions.

B. Financial institutions may enter into multiple-fiduciary accounts with more than one fiduciary to the same extent that they may enter into fiduciary accounts with one fiduciary. Any multiple-fiduciary account may be paid, on request, to any one or more of the fiduciaries.

1979, c. 407, § 6.1-125.9; 2010, c. 794; 2020, c. 259.

Any sums in a joint account may be paid, on request, to any party without regard to whether any other party is incapacitated or deceased at the time the payment is demanded. Payment may not be made to the personal representative or heirs of a deceased party under the Virginia Small Estate Act (§ 64.2-600 et seq.) unless (i) proof of death is presented to the financial institution showing that the decedent was the last surviving party or (ii) there is no right of survivorship under § 6.2-608.

1979, c. 407, § 6.1-125.10; 2010, cc. 269, 794.

Any P.O.D. account may be paid, on request, to any original party to the account. Payment may be made, on request, to the P.O.D. payee or to the personal representative or heirs of a deceased P.O.D. payee under the Virginia Small Estate Act (§ 64.2-600 et seq.) upon presentation to the financial institution of proof of death showing that the P.O.D. payee survived all persons named as original payees. Payment may be made to the personal representative or heirs of a deceased original payee under the Virginia Small Estate Act (§ 64.2-600 et seq.) if proof of death is presented to the financial institution showing that his decedent was the survivor of all other persons named on the account either as an original payee or as P.O.D. payee.

1979, c. 407, § 6.1-125.11; 2010, cc. 269, 794.

Any trust account may be paid, on request, to any trustee. Unless the financial institution has received written notice that the beneficiary has a vested interest not dependent upon his surviving the trustee, payment may be made to the personal representative or heirs of a deceased trustee if proof of death is presented to the financial institution showing that his decedent was the survivor of all other persons named on the account either as trustee or beneficiary. Payment may be made, on request, to the beneficiary upon presentation to the financial institution of proof of death showing that the beneficiary or beneficiaries survived all persons named as trustees.

1979, c. 407, § 6.1-125.12; 2010, c. 794.

Any multiple-fiduciary account may be paid, on request, (i) to any one or more fiduciaries, including any successor fiduciary upon proof showing that the successor fiduciary is duly authorized to act, or (ii) at the direction of any one or more of the fiduciaries. In determining the trustees duly authorized to act, the financial institution may rely on a certification of trust provided pursuant to § 64.2-804.

2020, c. 259.

A. Payment made pursuant to §§ 6.2-612 through 6.2-615 discharges the financial institution from all claims for amounts so paid whether or not the payment is consistent with the beneficial ownership of the account as between parties, P.O.D. payees, beneficiaries, or fiduciaries, or their successors.

B. The discharge provided by subsection A does not extend to payments made after a financial institution has received written notice from any party able to request present payment to the effect that withdrawals in accordance with the terms of the account should not be permitted. Unless the notice is withdrawn by the person giving it, or the successor of any deceased party has concurred in any demand for withdrawal, a discharge provided by subsection A shall not apply to withdrawals permitted by the financial institution.

C. No other notice or any other information shown to have been available to a financial institution shall affect its right to the discharge provided by subsection A. The discharge provided by subsection A shall have no bearing on the rights of parties in disputes between themselves or their successors concerning the beneficial ownership of funds in, or withdrawn from, multiple-party accounts or multiple-fiduciary accounts.

D. If any party, or the personal representative of any party, notifies the financial institution in writing not to permit withdrawals by any party, the financial institution may refuse, without liability, to allow any withdrawal pending the determination of the rights of the parties.

1979, c. 407, § 6.1-125.13; 2010, c. 794; 2020, c. 259.

Without qualifying any other statutory right to setoff or lien, and subject to any contractual provision, if a party to a multiple-party account is indebted to a financial institution, the financial institution has a right to setoff against the account in which the party has or had immediately before his death a present right of withdrawal. The amount of the account subject to setoff is that proportion to which the debtor is, or was immediately before his death, beneficially entitled, and in the absence of proof of net contributions, to an equal share with all parties having present rights of withdrawal.

1979, c. 407, § 6.1-125.14; 2010, c. 794.

A. Every financial institution in the Commonwealth offering joint accounts to its depositors shall either:

1. Use two separate forms for the creation of joint accounts, one of which shall be clearly labeled "JOINT ACCOUNT WITH SURVIVORSHIP" and the other of which shall be clearly labeled "JOINT ACCOUNT -- NO SURVIVORSHIP," provided that a financial institution electing to use separate forms is not required to maintain both forms or make both forms available to persons opening joint accounts and may, in its discretion, elect to make one or both forms available to persons opening joint accounts; or

2. Use one form for the creation of such accounts that shall contain the two labels "JOINT ACCOUNT WITH SURVIVORSHIP" and "JOINT ACCOUNT -- NO SURVIVORSHIP," with appropriate blank space or lines beside such labels for the parties to sign in order to indicate the type of account desired, which signature requirement shall be in addition to any signature verification form.

B. The forms provided for in subdivision A 1 may be identical in all respects except for the labels therein specified. This section shall not be construed to prevent any financial institution from changing from one method of identification to the other method of identification at any time, nor to require a financial institution making such a change to make any changes to the forms of its existing accounts.

C. The forms described in subsection A shall include disclosures to inform persons opening joint accounts of the disposition of such accounts upon a party's death. Disclosures in a form substantially similar to the following shall satisfy the requirements of this section:

Joint Account With Survivorship -- On the death of a party to the account, the deceased party's ownership in the account passes to the surviving party or parties to the account.

Joint Account -- No Survivorship -- On the death of a party to the account, the deceased party's ownership in the account passes as a part of the party's estate under the party's will, trust, or by intestacy.

D. This section is not applicable to joint accounts created before July 1, 1980.

1979, c. 407, § 6.1-125.15; 1999, c. 125; 2010, c. 794; 2013, c. 70.

A. Parties to a joint account in a financial institution occupy the relation of principal and agent as to each other, with each standing as a principal in regard to his ownership interest in the joint account and as agent in regard to the ownership interest of the other party. The provisions of the Uniform Power of Attorney Act (§ 64.2-1600 et seq.) shall apply to such principal/agent relationships.

B. For the purposes of this section, the ownership interest of the parties to the joint account shall be determined in accordance with the provisions of this article.

1996, c. 260, § 6.1-125.15:1; 2010, cc. 455, 632, 794.

A. Unless otherwise provided in this article, the provisions of this article shall be applicable to all multiple-party accounts in every financial institution in the Commonwealth on July 1, 1980, regardless of when such multiple-party accounts might have been opened or created.

B. Nothing in this article shall affect the common-law presumption of convenience now existing between persons not married to each other in joint accounts that were created prior to July 1, 1980, insofar as the ownership of the funds, whenever deposited, during their joint lifetime or their right of survivorship therein are concerned. Issues regarding ownership of such funds shall continue to be decided pursuant to the precedents of the Virginia Supreme Court.

1979, c. 407, § 6.1-125.16; 2010, c. 794.