Court Opinion

ID: 5101698
Source: CourtListenerOpinion
Date Created: 2021-10-01 21:56:58.673404+00
Date Added: 2024-06-11T08:21:03.476857
License: Public Domain

LAMBERT, Chief Justice,
dissenting.
I would affirm the Court of Appeals. The majority holds that cashier’s checks are accounts; therefore, the survivor takes the check if the check is made payable to alternative payees. Here Appellant, decedent’s son, takes under the majority reasoning, to the exclusion of all other beneficiaries, because the check was made payable to “order of Eddie Raichel [decedent] or James Raichel [decedent’s son]”.
The majority rests its decision on KRS §§ 391.315(1), 391.300(1) and (4). None of these are controlling in this case. KRS § 391.300(1) defines an account as “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 like arrangement.” The majority incorrectly categorizes cashier’s checks as ‘accounts.’ Cashier’s checks do not fall within the phrase “other like arrangements” as the majority holds because these checks are unlike the other accounts listed in the statute. They are not accounts at all. The decedent was not a depositor because there was no deposit.1
KRS § 355.3-1102 states that one in possession of a negotiable instrument, such as a cashier’s check, may negotiate it.3 One who obtains a cashier’s check procures prior acceptance.4 The drawee has no right thereafter to refuse payment except for fraud. Thus a cashier’s check takes on the characteristics of currency which may be kept or exchanged as the possessor chooses. Here the possessor chose to keep his cashier’s check and it remained his property until the moment of his death, when it, like other personalty, passed to the control of his personal representative. Therefore, his estate succeeds to his interest and it may negotiate the check.
The majority cites Farmer’s Bank & Trust Co. v. Brazell5 comparing it to the case at bar. That case dealt with certificates of deposit with joint alternative payees. Certificates of deposit are accounts as defined in the statute. Because cashier’s checks are not accounts, this case is inapplicable. However, the case states that because certificates of deposit are negotiable instruments they can be negotiated by either payee who has them in their possession.6 This statement supports the argument put forth in this dissent that the possessor of a cashier’s check can negotiate the check.
Since cashier’s checks are not accounts, then survivorship rights associated with joint accounts do not exist if the check is payable to alternative payees. Because the check was in decedent’s possession at the time of his death, it is part of his estate. Appellee as administratrix of his estate may negotiate the check and add it to the personalty of the estate.
Appellee also claims that the way in which decedent proceeded with this trans*503action was deceitful and “it is apparent that decedent was attempting to conceal funds from his wife and in effect deprived her of her dower rights.”7
The holding by the majority could effectively eliminate dower rights. KRS § 392.020 states that a surviving spouse has a right to one-half surplus personalty of a spouse who died intestate. Under the majority holding, a spouse can now place most or all of his or her personal property (converted into cash) into a “joint account” in the form of a cashier’s check payable to the deceitful spouse or someone other than the surviving spouse.
Appellee cites Harris v. Rock8 to support her dower rights argument. In Har-ds, the Supreme Court reversed the Court of Appeals, because the wife should have received dower interest in joint accounts in the name of decedent and decedent’s children because such accounts were personalty of her husband. “Widow’s right to dower cannot be defeated by a gift by her spouse of all, or more than one-half, of his property to another with the intent to defeat the claims to dower.”9 The majority in Hards read an implied limitation into KRS § 391.315 so that a widow can recover dower interests in joint accounts if the money was deposited into the account when the depositor did not have a right to deposit the money in the first place. A depositor would not have the right to deposit funds if the depositor is trying to defeat dower rights. If this is the case, the survivor of the joint account is not an unrestricted owner of the funds, instead the surviving spouse takes dower interest in the remaining funds.10
Hards is inapplicable to the present case because it dealt with the implied limitation on an account per KRS § 391.315(1). Since there is no account or joint account by virtue of the cashier’s check, this case and statute do not apply.
For the above mentioned reasons, Ap-pellee, as administratrix of the decedent’s estate, should take the cashier’s check as a part of the decedent’s estate. As the majority has held otherwise, I respectfully dissent.
JOHNSTONE, J., joins this dissenting opinion.

. Deposit is defined in 9 C.J.S. Banks and Banking § 269 (1996) as "a sum of money left with a bank and the depositor as the person who leaves it there.”

. (4) If an instrument is payable to two (2) or more persons alternatively, it is payable to any of them and may be negotiated, discharged, or enforced by any or all of them in possession of the instrument.

. KRS § 355.3-201. Negotiation. (1) "Negotiation” means a transfer of possession, whether voluntary or involuntary, of an instrument by a person other than the issuer to a person who thereby becomes its holder.

. KRS § 355.3-409.

. Ky., 902 S.W.2d 830 (1995).

. Id. at 832.

. Appellee's Brief at page 6.

. Ky., 799 S.W.2d 10 (1990).

. Mat 11.

. Id. at 12.