IN THE SUPREME COURT OF TENNESSEE

AT NASHVILLE

April 5, 2017 Session Heard at Jackson

IN RE ESTATE OF CALVERT HUGH FLETCHER

Appeal by Permission from the Court of Appeals

Probate Court for Putnam County

No. 18589 Steven D. Qualls, Judge

___________________________________

No. M2015-01297-SC-R11-CV

___________________________________

A husband and wife deposited funds in a joint checking account designated with a right 

of survivorship. Later, the husband withdrew most of the funds from the joint account 

and placed the funds in a certificate of deposit issued solely in his name. After the 

husband’s death, a dispute arose between his surviving spouse and his children from a 

previous marriage regarding ownership of the certificate of deposit. The trial court, 

relying on Mays v. Brighton Bank, 832 S.W.2d 347 (Tenn. Ct. App. 1992), held that the 

certificate of deposit was an asset of the husband’s estate because the funds ceased to be 

entireties property when withdrawn from the joint account. The Court of Appeals 

reversed and, relying on In re Estate of Grass, No. M2005-00641-COA-R3-CV, 2008 

WL 2343068, at *1 (Tenn. Ct. App. June 4, 2008), held that the certificate of deposit 

belonged to the surviving spouse because the funds were impressed with the entireties 

and could be traced to the joint account. We hold that once funds are withdrawn from a 

bank account held by a married couple as tenants by the entirety, the funds cease to be 

entireties property. Accordingly, the certificate of deposit issued to the husband from 

funds withdrawn from the joint bank account belongs to his estate, not his surviving 

spouse. We reverse the Court of Appeals and remand to the trial court for further 

proceedings.

Tenn. R. App. P. 11 Appeal by Permission; Judgment of the Court of Appeals 

Reversed; Case Remanded

SHARON G. LEE, J., delivered the opinion of the court, in which JEFFREY S. BIVINS, C.J.,

and CORNELIA A. CLARK, HOLLY KIRBY, and ROGER A. PAGE, JJ., joined.

12/06/2017
2

Henry D. Fincher, Cookeville, Tennessee, for the appellants, Elaine Fletcher, Janet L.

Fletcher Brady, Richard H. Fletcher, and Peter J. Fletcher.

Kenneth S. Williams, Cookeville, Tennessee, for the appellee, Nelda Karene Fletcher.

Michael T. Harmon and Timothy L. Amos, Nashville, Tennessee, for Amicus Curiae, 

Tennessee Bankers Association.

OPINION

I.

In April 2012, Calvert Hugh Fletcher and his wife, Nelda Karene Fletcher,

refinanced their home and paid off a line of credit secured by the home. They deposited 

most of the proceeds into a newly-opened joint checking account with FSG Bank. The 

FSG Bank account agreement designated the account as “JOINT – WITH 

SURVIVORSHIP (and not as tenants in common).” Funds could be withdrawn from the 

account based on the signature of either Mr. or Mrs. Fletcher. 

In January 2013, Mr. Fletcher withdrew $100,000 from the joint checking account

and obtained a $100,000 certificate of deposit solely in his name, issued by FSG Bank. 

The certificate of deposit was pledged as security for a $100,000 line of credit, although 

the line of credit was never used. In February 2013, the FSG joint checking account was 

closed. 

Mr. Fletcher became ill in March 2013 and died on September 6, 2013. In his will, 

Mr. Fletcher bequeathed his tangible personal property and effects to Mrs. Fletcher and 

left the residuary estate to his four adult children from a prior marriage.

Mrs. Fletcher filed the will for probate in the Putnam County Probate Court and 

was appointed executrix for the estate. Mrs. Fletcher filed an estate inventory with the 

court, listing the certificate of deposit as a non-estate asset, and later filed a petition 

asking the probate court to designate the certificate of deposit as her separate marital 

property. Mr. Fletcher’s children maintained that the certificate of deposit was estate 

property. 

At the hearing to determine ownership of the certificate of deposit, Mrs. Fletcher 

testified that in April 2012, she and Mr. Fletcher opened a joint bank account in a money 

market fund at FSG Bank with an initial deposit of $100,415.73. Of these funds, 

$89,779.97 came from the refinancing of the mortgage on their marital home, and the rest 

of the money came from marital funds. Mrs. Fletcher said she knew Mr. Fletcher 

intended to use the funds in the joint account for potential future investments, but she did 

not agree for Mr. Fletcher to transfer $100,000 from the joint bank account into a
3

certificate of deposit issued solely in his name. Mrs. Fletcher testified she did not know 

the funds had been withdrawn until December 2013, when she spoke with a bank officer 

to receive an update on the couple’s accounts.

Mrs. Fletcher admitted that she signed the joint account card that provided only 

one signature was required for withdrawal of funds. Mrs. Fletcher explained that she paid 

the family’s bills and that bank statements were mailed to the marital home. Although her 

practice was to open and review the bank statements, Mrs. Fletcher did not recall seeing a

statement evidencing a withdrawal in January 2013 of just over $100,000 or a statement 

indicating that the joint account had been closed in February 2013. Although Mrs. 

Fletcher knew that Mr. Fletcher was investing in real estate and working to develop

Walden Villages subdivision when he became ill, she did not try to prevent him from 

investing. Mrs. Fletcher testified that she knew if he wanted to, Mr. Fletcher would use 

the money from the refinance loan for investment purposes. When asked if she would 

have agreed for Mr. Fletcher to withdraw $100,000 to purchase stock, Mrs. Fletcher 

acknowledged that he probably would not have asked her because that was his practice. 

Mrs. Fletcher agreed that she could have withdrawn $100,000 from the joint account but

would not have done so. 

Mr. Fletcher’s daughter, Elaine Fletcher, testified that in April 2013, her father 

asked her to assist Mrs. Fletcher in repaying a loan. While at the Fletchers’ home, Elaine 

Fletcher saw a statement on the kitchen table for an account only in her father’s name 

containing $100,000, which she and Mrs. Fletcher discussed. Elaine Fletcher overheard 

Mrs. Fletcher’s side of a conversation with FSG Bank Vice-President Howard Bilbrey. 

Elaine Fletcher also spoke with Mr. Bilbrey, who told her that the money was in a 

certificate of deposit and would be difficult to withdraw. When Elaine Fletcher relayed 

this information to Mrs. Fletcher, they were both surprised to learn the money was in a 

certificate of deposit, but Mrs. Fletcher was not surprised that it was in only Mr. 

Fletcher’s name.

Janet Fletcher Brady, another of Mr. Fletcher’s children, testified she came to help 

care for her father in March and April 2013. Ms. Brady said that Mrs. Fletcher knew of 

the investment in Walden Villages subdivision and that Mrs. Fletcher was handling the 

finances for herself and Mr. Fletcher.

The probate court ruled that the certificate of deposit was an asset of Mr. 

Fletcher’s estate, relying on Mays v. Brighton Bank, 832 S.W.2d 347, 351 (Tenn. Ct. 

App. 1992), which held that the withdrawn funds ceased to be tenancy by the entirety 

property upon withdrawal. The probate court found that after the April 2013 telephone 

conversation with Mr. Bilbrey, Mrs. Fletcher knew or should have known that the 

certificate of deposit existed, or at least that the funds were held in something other than 

the Fletchers’ joint checking account, and that she acquiesced in creating the certificate of 

deposit. Further, the probate court ruled that there was no proof of fraud, noting that Mr. 
4

Fletcher directed FSB Bank to send the certificate of deposit account statements to the 

marital home. The probate court held that the funds from the Fletchers’ joint account 

ceased to be entireties property. Because the certificate of deposit was only in Mr. 

Fletcher’s name at the time of his death and there were no designations of payment on 

death to any individual, the certificate of deposit was part of Mr. Fletcher’s estate.

1 Mrs. 

Fletcher appealed.

The Court of Appeals reversed and held that the funds in the certificate of deposit 

belonged to Mrs. Fletcher, as the certificate of deposit was entireties property at Mr. 

Fletcher’s death. In re Estate of Fletcher, No. M2015-01297-COA-R3-CV, 2016 WL 

3090920, at *10 (Tenn. Ct. App. May 23, 2016). The Court of Appeals noted the split of 

authority on this issue in the Tennessee appellate courts and in other jurisdictions. Id. at 

*4. Compare Mays v. Brighton Bank, 832 S.W.2d 347, 350–51 (Tenn. Ct. App. 1992) 

(following McEntire v. Estate of McEntire, 590 S.W.2d 241, 244–45 (Ark. 1979) 

(holding that the wife’s withdrawal of funds from a joint account eliminated the entireties 

nature of the funds)), with In re Estate of Grass, No. M2005-00641-COA-R3-CV, 2008 

WL 2343068, at *14 (Tenn. Ct. App. June 4, 2008) (following Madden v. Gosztonyi Sav. 

& Trust Co., 200 A. 624, 630–31 (Pa. 1938) (holding that funds withdrawn from a 

marital account remained impressed as entireties property and receipt of the property was

subject to the entirety provision)). The Court of Appeals rejected Mays and relied on 

Grass, based on its conclusion that a spouse’s ownership interest should not cease 

because the other spouse withdrew funds from the joint account. Fletcher, 2016 WL 

3090920, at *9. Further, the Court of Appeals reasoned that the joint account agreement 

should not be construed as proof of prior consent to termination of the tenancy by the 

entirety through unilateral withdrawal. Id. at *9–10. The intermediate appellate court 

concluded that the evidence did not establish that Mrs. Fletcher agreed to give up her 

entirety interest in the funds withdrawn by Mr. Fletcher. Id. at *10. The Court of Appeals 

held that the certificate of deposit passed to Mrs. Fletcher as the surviving spouse because 

the funds were impressed with the entirety provision. Id.

We granted the application for permission to appeal filed by Mr. Fletcher’s 

children.

II.

This matter was heard without a jury; therefore, our standard of review is de novo 

upon the record of the proceedings below with a presumption of correctness as to the trial 

court’s factual determinations, unless the evidence preponderates otherwise. Tenn. R. 

App. P. 13(d); Cross v. City of Memphis, 20 S.W.3d 642, 645 (Tenn. 2000) (citing Tenn.

 

1 The trial court certified the order as final, finding “no just reason for delay” under Rule 54.02 of 

the Tennessee Rules of Civil Procedure. 
5

R. App. P. 13(d)). There is no presumption of correctness, however, as to the trial court’s 

legal conclusions. Mills v. Fulmarque, Inc., 360 S.W.3d 362, 366 (Tenn. 2012) (citing 

Hall v. Haynes, 319 S.W.3d 564, 571 (Tenn. 2010); Bailey v. Blount Cnty. Bd. of Educ., 

303 S.W.3d 216, 226 (Tenn. 2010)).

Under Tennessee law, a married couple can own property as tenants by the 

entirety. See Bryant v. Bryant, 522 S.W.3d 392, 400 (Tenn. 2017) (citing Griffin v. 

Prince, 632 S.W.2d 532, 534–35 (Tenn. 1982); Tenn. Code Ann. §§ 36-3-505, 31-1-108). 

Tenancy by the entirety is a form of property ownership unique to married persons. Grahl 

v. Davis, 971 S.W.2d 373, 378 (Tenn. 1998) (citing Griffin, 632 S.W.2d at 534). Each 

spouse holds an interest in the entirety—the whole property—rather than in undivided 

parts. Bryant, 522 S.W.3d at 400–01 (quoting Tindell v. Tindell, 37 S.W. 1105, 1106 

(Tenn. Ch. App. 1896)). “When property is held in a tenancy by the entirety, upon the 

death of one spouse, the survivor continues to own the whole in fee simple,” Id. at 400,

and the laws of descent and distribution do not apply. Grahl, 971 S.W.2d at 378 (citing 

Sloan v. Jones, 241 S.W.2d 506, 509 (Tenn. 1951)). Married couples can own both real 

property and personal property, including bank accounts, as tenants by the entirety. 

Griffin, 632 S.W.2d at 535 (citing Campbell v. Campbell, 66 S.W.2d 990 (Tenn. 1934); 

Smith v. Haire, 181 S.W. 161 (Tenn. 1915)). When the property is real estate held as a 

tenancy by the entirety, one spouse cannot unilaterally sever the tenancy by transferring a 

portion of the property to a third party without the consent of the other spouse because 

doing so would destroy the other spouse’s ownership interest in the whole. Bryant, 522 

S.W.3d at 401 (citing Tindell, 37 S.W. at 1106); see also Sloan, 241 S.W.2d at 509 

(stating that when a married couple acquired real estate, “there would be no question . . . 

that upon the death of one[,] the survivor would take the entire real estate”).

Bank accounts are treated differently given the nature of the asset. Unlike real 

property, portions of a joint bank account can be unilaterally withdrawn without severing 

or destroying the tenancy. See Tenn. Code Ann. § 45-2-703(c) (1988) (defining 

“multiple-party deposit account” as an account established in the names of or subject to 

withdrawal by two or more persons).

Here, the Fletchers’ FSG Bank account was designated, “JOINT – WITH 

SURVIVORSHIP (and not as tenants in common).” The parties do not dispute that Mr. 

and Mrs. Fletcher held the joint account as tenants by the entirety.

2 A joint bank account 

held by husband and wife is presumed to be a tenancy by the entirety absent proof to the 

contrary. Grahl, 971 S.W.2d at 378 (citing Griffin, 632 S.W.2d at 536). Words in a legal 

instrument that make two persons joint tenants or tenants in common create a tenancy by 

 

2 Here, no issue was raised as to whether the designation on a bank’s signature card as “JOINT –

WITH SURVIVORSHIP (and not as tenants in common)” was sufficient to overcome the presumption 

that the bank account was held as tenants by the entirety.
6

the entirety in an account held by husband and wife. Griffin, 632 S.W.2d at 535 (citing 

First Am. Nat’l Bank v. Evans, 417 S.W.2d 778, 780–81 (Tenn. 1967); Bennett v. 

Hutchens, 179 S.W. 629 (Tenn. 1915)). This is the case even if the account cards do not 

use the words, “tenants by the entirety,” or use the word, “joint.” Id. at 536.

Although the Fletchers could have provided that both of their signatures were 

required for a withdrawal of funds, they agreed that either signature was sufficient to 

withdraw funds. Based on the terms of the account agreement, at the death of one spouse, 

the surviving spouse retained ownership over any funds in the account. Mr. Fletcher, as 

authorized by the account agreement, withdrew funds from this joint checking account 

without his wife’s signature. He then placed the funds in a certificate of deposit solely in 

his name. Upon Mr. Fletcher’s death, Mrs. Fletcher continued to own the funds in the 

bank account.

The issue before us is whether the certificate of deposit, consisting of funds 

withdrawn from the joint account, belongs to Mr. Fletcher’s estate upon his death, or if 

the withdrawn funds are impressed with the entirety such that the certificate of deposit 

belongs to Mrs. Fletcher as his surviving spouse. There is a split of authority on this issue 

in Tennessee and in courts across the country. It is a matter of first impression for this 

Court.

In Sloan v. Jones, 241 S.W.2d 506 (Tenn. 1951), the Tennessee Supreme Court 

was not presented with the issue. However, the Court cited with approval the 

Pennsylvania case of Madden v. Gosztonyi Sav. & Trust Co., 200 A. 624, 630 (Pa. 1938), 

for the proposition that bank deposits payable to “husband and wife” or to “husband or 

wife” are held by them as tenants by the entirety. Sloan, 241 S.W.2d at 508. The Supreme 

Court in Sloan held that a tenancy by the entirety may be created by a joint bank deposit, 

where the parties demonstrate an intent to jointly own the account or such intent can be 

inferred from the circumstances. When an account is made payable to either “husband 

and wife” or “husband or wife,” each has the power to act for the other as an incident of 

an estate by the entirety. Id. (quoting Madden, 200 A. at 630). Through this implied 

agency or authority, the husband or the wife may “withdraw the entire account, but the 

money thus withdrawn is impressed with the entirety provision that it is the property of 

both.” Id. at 509 (quoting Madden, 200 A. at 631 (internal quotation marks omitted)).

Anyone dealing with such specific property knowing it belongs to both spouses “must 

submit to the consequences.” Id. (quoting Madden, 200 A. at 631 (internal quotation 

marks omitted)). Although this additional language had little to do with our ultimate 

holding in Sloan, the Madden language resurfaced many years later as tenancy by the 

entireties principles and the application of those principles to bank accounts developed

further. 

In Griffin v. Prince, 632 S.W.2d 532 (Tenn. 1982), this Court considered whether 

an individual creditor of the husband could garnish the husband and wife’s joint checking 
7

and savings accounts. The accounts were held in the name of Mr. or Mrs. Prince, and the

signature cards for the accounts indicated that they were joint accounts with the right of 

survivorship. Id. at 533–34. The Tennessee Supreme Court ordered the dismissal of the 

garnishment. Id. at 538. Relying on Sloan and Madden, the Court determined that the fact 

the account cards did not use the words, “tenants by the entirety,” or that they used the 

word, “joint,” did not prevent ownership by the entirety if the depositors were married 

when the account was created and were still married at the time of the garnishment. Id. at

536.

The Griffin Court briefly addressed the import of the banking statute, Tennessee 

Code Annotated section 45-2-703, which, at the time, provided:

(a) When a deposit has been made or shall hereafter be made, in any bank 

in the names of two (2) or more persons, payable to either, or survivor, such 

deposit, or any part thereof, . . . whether the others be living or not; and the 

receipt or acquittance of such person so paid shall be a valid and sufficient 

release and discharge to the bank for any payment so made.

Tenn. Code Ann. § 45-2-703(a) (1980), quoted in Griffin, 632 S.W.2d at 537. The statute 

did not abolish tenancy by the entirety in bank deposits held by spouses or change the 

fundamental form of property ownership in bank accounts because the accounts were

payable to either spouse or subject to individual checking or withdrawal. Griffin, 632 

S.W.2d at 537. 

After Griffin, the General Assembly amended section 45-2-703(a) by adding the 

following sentence to protect the interest of creditors: 

Any balance so created shall be subject to assignment by, or the claim of 

any creditor of, either depositor, as if such depositor were the sole owner of 

the funds; provided, however, that if such creditor realizes its claim, by 

garnishment, set off, or otherwise, any other depositor may, by appropriate 

action against the creditor, establish such rights as that depositor may have 

in the funds.

Tenn. Code Ann. § 45-2-703(a) (1983). This amendment made no substantive change 

relative to joint bank accounts created by husband and wife and did not repudiate Griffin.

Edwards v. Edwards, 713 S.W.2d 642, 646 (Tenn. 1986).

In 1988, the General Assembly again amended section 45-2-703(a) by adding the 

following language:

Any balance so created, including, without limitation, any balance held by 

spouses, shall be subject to assignment by, or the claim of any creditor of, 
8

either depositor, as if such depositor were the sole owner of the funds; 

provided, that if such creditor realizes its claim by any means other than 

enforcement of an assignment, pledge, or the grant of a security interest 

made by any one (1) of such depositors, any other depositor not indebted to 

the creditor may, by commencing a separate action against the creditor, 

establish such rights as that depositor may have in the funds.

Tenn. Code Ann. § 45-2-703(a) (Supp. 1993) (emphasis added). These statutory 

amendments clarified the rights of creditors and the other account owner(s) but did not 

address the legal status of property acquired with funds withdrawn unilaterally by one of 

the account owners.

The Court of Appeals in Mays v. Brighton Bank, 832 S.W.2d 347 (Tenn. Ct. App. 

1992), addressed the issue concerning the legal status of property acquired in part with an 

individual loan deposited into a joint bank account owned by a husband and wife as 

tenants by the entirety. Mr. Mays borrowed money to purchase a horse trailer to give to 

his wife; his wife was not a party to the loan agreement. Id. at 348. The terms of the loan 

granted the bank a security interest in the trailer. The loan proceeds were deposited into 

the Mayses’ joint account, from which Mrs. Mays made the down payment and final 

payment for the trailer. Id. at 349. When she made the final payment, Mrs. Mays received 

a certificate of origin that assigned ownership of the trailer solely to her. No liens were 

recorded on the trailer’s certificate of origin. When the parties divorced shortly after the 

purchase of the trailer, the bank repossessed the trailer. Mrs. Mays brought a detainer 

action against the bank to recover the trailer. Id. at 348–49. The trial court held that the 

bank had a purchase money security interest in the trailer. Id. at 352. Citing Sloan and 

Griffin, the trial court determined that Mr. and Mrs. Mays each owned the loan funds 

deposited into their joint account as tenants by the entirety. Id. at 350. However, property 

purchased by one spouse with funds withdrawn from the bank account held by the 

spouses does not automatically become tenancy by the entirety property; instead, the 

legal status of property purchased with the funds depends on the legal status of the funds.

The Court of Appeals affirmed, recognizing a split of authority as to whether the property 

purchased with funds withdrawn from a tenancy by the entirety account continues to be 

tenancy by the entirety property. The Court of Appeals noted that some courts follow the 

Arkansas approach, which states that, where one account owner withdraws funds from a 

tenancy by the entirety account or simply removes the other party’s name from the joint 

account, the other party’s interest in the affected funds ends. See id. (citing McEntire, 590 

S.W.2d 241; Bealert v. Mitchell, 585 S.W.2d 417 (Ky. App. 1979)). Other jurisdictions 

follow the Pennsylvania approach, under which funds removed from tenancy by the 

entirety accounts continue to be tenancy by the entirety property. See id. (citing Matter of 

Morrow’s Estate, 570 P.2d 912 (N.M. 1977); Madden, 200 A. 624).

The Court of Appeals, adopting the Arkansas approach, reasoned that for Mr. 

Mays to have given the trailer to Mrs. Mays as a gift, he must first have had an interest in 
9

the property. Id. at 351. Mr. Mays intended the trailer to be the gift, not the funds used to 

purchase it. Thus, Mrs. Mays had acted as her husband’s agent when she paid for the 

trailer, and Mr. Mays’ (and thus the bank’s) interest in the trailer existed before the 

certificate of origin was issued to Mrs. Mays. Id. at 351–52. Accordingly, Mrs. Mays 

took the trailer subject to the bank’s security interest. Id. at 352.

In Grahl v. Davis, 971 S.W.2d 373 (Tenn. 1998), this Court did not overrule Mays

but noted that Mays was inconsistent with Sloan and Griffin. Id. at 379 n.3. In Grahl, the 

issue was whether a conservator had violated her fiduciary duties; the case did not 

concern the legal status of funds withdrawn from a tenancy by the entirety account. Id. at

379. In a footnote, the Court briefly summarized Mays, Griffin, and Sloan and 

commented that “Mays appears to be inconsistent with this Court’s prior decisions.” Id. at

379 n.3 (quoting Griffin, 632 S.W.2d at 536 (internal quotation marks omitted)). 

The Court of Appeals in In re Estate of Grass, No. M2005-00641-COA-R3-CV, 

2008 WL 2343068 (Tenn. Ct. App. June 4, 2008), determined that Mays was inconsistent 

with the Supreme Court’s prior decision in Sloan. Id. at *14 (quoting Grahl, 971 S.W.2d. 

at 379 n.3). In Grass, the Court of Appeals considered whether the probate court erred in 

classifying as a fraudulent conveyance funds the decedent wife had withdrawn from a 

joint account with her husband and placed in two accounts payable to her children upon 

her death. Id. at *6, *12. The intermediate appellate court remanded the case to the 

probate court to determine how the decedent and her husband held the bank account, and 

if they held the account as tenants by the entirety, whether the money withdrawn by one 

spouse continued to be held as tenants by the entirety property. Id. at *13. The Court of 

Appeals ruled that, if the probate court determined that the decedent and her husband 

held their joint bank account as tenants by the entirety, then the withdrawn funds were 

impressed with the entirety provision. Id. at *14. Further, the Court of Appeals held that a

tenancy by the entirety can be terminated only when both spouses convey, when one 

spouse dies and the survivor becomes owner of the whole, or when the parties divorce 

and become tenants in common in the property. Id. (quoting White v. Watson, 571 

S.W.2d 493, 495 (Tenn. Ct. App. 1978)). Therefore, if the joint account was held as a 

tenancy by the entirety and the husband did not agree to the transfer of the funds, then 

upon the decedent’s death, the funds vested to the husband, not to the decedent’s 

children. Id. (citing Sloan, 241 S.W.2d at 507). By relying on Sloan, the Court of Appeals 

implicitly adopted the Pennsylvania approach while rejecting Mays and the Arkansas 

approach.

The Pennsylvania approach was first stated by the Pennsylvania Supreme Court in

Madden v. Gosztonyi Sav. & Trust Co., 200 A. 624 (Pa. 1938):

Where a deposit is made payable to either spouse, agency or authority 

exists by implication, and the husband or the wife may, from that authority, 

withdraw the entire account, but the money thus withdrawn is impressed 
10

with the entirety provision that it is the property of both, and any one 

dealing with such specific property as severalty, knowing it belongs to 

both, must submit to the consequences.

Id. at 631, quoted in Sloan, 241 S.W.2d at 507. The Madden court reasoned that “either 

spouse presumptively has the power to act for both . . . without any specific 

authorization, provided the fruits or proceeds of such action inures to the benefit of both

and the estate is not terminated.” Id. at 630–31. Neither party may destroy the “true 

purpose” of the estate by the entirety by attempting to convert it or a part of it, in bad 

faith, into an estate held in severalty. Id. at 631.

This approach taken by the Pennsylvania courts has been followed by the courts of 

other states. See, e.g., Moser v. Moser, 287 A.2d 398, 400 (Del. 1972) (holding that 

property acquired with joint funds remains the joint property of the spouses even if title is 

taken in the name of one spouse); Morrison v. Potter, 764 A.2d 234, 238 (D.C. App. 

2000) (finding that unilateral withdrawal of funds from a joint bank account does not 

defeat a tenancy by the entireties estate because each spouse acts as the other’s agent and 

consents in advance to each other’s withdrawal); Ambruster v. Ambruster, 31 S.W.2d 28, 

37 (Mo. 1930) (finding that a joint account allowing either co-owner to withdraw funds 

raises a presumption or inference that the joint interest follows the funds and does not 

result in a severance of the funds from the joint estate).

While the Pennsylvania approach protects the surviving spouse’s ownership 

interests, the Arkansas approach allows for the unilateral termination of the tenancy by 

the entirety. Under the Arkansas approach, “[f]unds withdrawn or otherwise diverted 

from the account by one of the tenants and reduced to that tenant’s separate possession 

ceases to be a part of the estate by the entireties.” McEntire, 590 S.W.2d at 244 (citing 

Black v. Black, 135 S.W.2d 837 (Ark. 1940); McGuire v. Benton State Bank, 342 S.W.2d 

77 (Ark. 1961)). In McEntire, the decedent held an individual checking account and 

obtained a new signature card for his wife, permitting either to withdraw funds from the 

account but retaining the account only in Mr. McEntire’s name. Id. at 242. Both Mr. and 

Mrs. McEntire occasionally withdrew funds from the account on his or her individual

signature. Mr. McEntire had a new signature card issued in his name only, ending Mrs. 

McEntire’s authority to withdraw funds from the account. Under a then-applicable 

Arkansas statute, bank accounts held in the names of persons who designate themselves 

as husband and wife are held by the married couple as tenants by the entireties, and upon 

the death of one of the persons, the account is payable to the survivor. Id. at 244 (citing 

Ark. Code Ann. § 67-552). The statute further provided that the banking institution shall 

pay withdrawal requests and otherwise deal in any manner with the account upon the 

direction of any one of the persons on the account. Id. (citing Ark. Code Ann. § 67-552). 

The Arkansas Supreme Court held that when funds are withdrawn by one of the tenants

and reduced to that tenant’s separate possession, those funds cease to be part of the estate 
11

by the entireties. Id. (citing Black, 135 S.W.2d at 840; McGuire, 342 S.W.2d at 78). The 

Arkansas Supreme Court ruled for the estate and the bank. Id. at 245.

The Arkansas Supreme Court re-affirmed this ruling in Cloud v. Brandt, 259 

S.W.3d 439 (Ark. 2007), where a husband withdrew funds from a joint checking account 

held with his wife as tenants by the entirety, deposited the funds into a separate checking 

account in his name, and then purchased certificates of deposit with funds from his 

individual account. Id. at 440–41. When the husband died, the wife sought a declaratory 

judgment that the certificates of deposit belonged to her as the surviving tenant of a 

tenancy by the entirety in the joint funds. Id. at 441. The Arkansas Supreme Court held 

that, because one spouse is not required to obtain the other spouse’s consent to withdraw 

funds from a tenancy by the entirety account, the decedent did not need to obtain the 

other spouse’s consent to destroy the tenancy by the entirety in the joint account and 

could do so unilaterally. Id. at 444. As the surviving tenant by the entirety, the wife was 

entitled to only the balance of funds in the joint account at the time of her husband’s 

death.

Several jurisdictions follow the Arkansas approach. See, e.g., In re Estate of 

Vogel, 684 N.E.2d 1035, 1038 (Ill. App. Ct. 1997) (holding that a party to a joint bank 

account who withdraws all the funds from the account is not liable to the other joint 

depositors for the withdrawn funds); Casagranda v. Donahue, 585 P.2d 1286, 1288 

(Mont. 1978) (holding that either owner of a joint bank account can acquire the whole 

account by withdrawing it during the lifetime of the co-owner or by survivorship); Rose 

v. Hooper, 122 N.W.2d 753, 759 (Neb. 1963) (finding that the withdrawal of funds from 

a joint account destroys joint ownership in the funds and property purchased with the 

withdrawn funds, regardless of the consent of the other joint owners and reinvestment by 

the person withdrawing the funds in property owned individually or with others); In re 

Estates of Beisbier, 177 N.W.2d 919, 923–24 (Wis. 1970) (holding that a wife’s estate 

had no claim to bonds purchased from joint checking account and owned solely by the

surviving husband, noting that a joint checking account is more “a shared wallet than a 

shared investment”).

In our view, the Arkansas approach reflects the better approach in light of our 

current banking environment. When either spouse is authorized to withdraw funds from a 

joint bank account (as indicated on the signature card), this grant of authority reflects the 

basic trust a husband and wife have in each other.

3

Each spouse fully expects the other 

spouse to make regular withdrawals from the account without the need for approval by 

 

3 There is no allegation or evidence that Mr. Fletcher acted fraudulently by withdrawing $100,000 

from the joint account or by placing the certificate of deposit in his individual name. Therefore, we need

not address the status of funds withdrawn from a joint account by one spouse under circumstances 

suggesting an intent to defraud, to avoid creditors, or to defeat the interests of a spouse in anticipation of 

divorce. 
12

the non-withdrawing spouse in every transaction. Under the Arkansas approach, the 

funds, once withdrawn, cease to be entireties property. The legal status is clear, and all 

parties know their respective positions.

The Pennsylvania approach does not provide the needed clarity and finality 

necessary in the banking arena. This approach arguably leads to uncertainty in banking 

transactions and may often result in tracing joint funds long after the funds have been 

spent. As a practical matter, it is difficult, if not impossible, for the third party receiver of 

such funds to know of the entireties source or character of the funds, resulting in the 

possibility that the non-withdrawing spouse could later object to the earlier withdrawal. 

One could certainly be swayed by equity to side with the Pennsylvania approach when 

the withdrawn sum is rather large as in this case. However, the sum involved must not be 

determinative and instead must give way to the clarity and certainty provided by the 

Arkansas approach. Whether the withdrawal was $100 or $100,000, the policy 

considerations must be consistent. To the extent that Sloan, Griffin, Grahl, and In re 

Estate of Grass are inconsistent with this opinion, they are overruled.

III.

We adopt the Arkansas approach and hold that, once a husband or wife withdraws 

funds from a joint bank account held as tenants by the entirety, the funds cease to be held 

by the entirety. When Mr. Fletcher withdrew funds from the Fletchers’ joint account, 

those funds ceased to be property held by the entirety. The certificate of deposit 

purchased with the withdrawn funds and issued to Mr. Fletcher individually belonged 

only to Mr. Fletcher. When he died, the certificate of deposit became part of Mr. 

Fletcher’s estate and did not pass outside the estate to his surviving spouse. Accordingly, 

we reverse the decision of the Court of Appeals and remand to the trial court. Costs of 

this appeal are taxed to appellee, Nelda Karene Fletcher, for which execution may issue if 

necessary.

_______________________________

SHARON G. LEE, JUSTICE