Court Holds MPDAA Controls over Tenancy Act in Joint Account Ownership Case Banner Image

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Court Holds MPDAA Controls over Tenancy Act in Joint Account Ownership Case

December 20, 2023


The New Jersey Appellate Division recently decided a case involving levies on a bank account wherein it held the New Jersey’s Multiple-Party Deposit Account Act, N.J.S.A. 17:16I-4 et seq. controls over the New Jersey’s Tenancy Act, N.J.S.A. 46:3-17 et seq., in deciding ownership of the account. See Discover Bank v. Mullen, No. A-2579-22, 2023 N.J. Super. Unpub. LEXIS 2278 (Super. Ct. App. Div. Dec. 13, 2023).

The Trial Court Decision

Defendant Steven Mullen (“Mullen”) and Erica Kaps married in 2013. The couple had joint primary and secondary PNC Bank accounts. On June 9, 2022, a judgment for $8,432.26 was entered against Mullen in favor of Discover Bank (the “Bank”), and after a writ of execution was effectuated to satisfy the judgment, a total of $9,282,03 was levied from the joint accounts. The Bank then filed a turnover motion for these funds.

Mullen opposed the motion, “arguing that the funds in the joint accounts were exempt from levy” under the Tenancy by Entirety Act, N.J.S.A. 46:3-17 et seq. (“Tenancy Act”).  Mullen also submitted bank statements with his and his wife’s names, showing that he and his wife were joint owners of the two bank accounts. He did not submit additional documents detailing ownership of the two accounts or contributions thereto. After the Court held an argument over the motion, the Court entered an oral decision granting the Plaintiff’s motion.

The Trial Court distinguished the facts of this case from those in Jimenez v. Jimenez, 454 N.J. Super. 432, 437-39 (App. Div. 2018). There, the Court “precluded partition of real property owned by a married couple as a tenancy by the entirety to collect a judgment entered against only one spouse.” Here, the issue at hand centered on joint account ownership and not real property, and thus Jimenez was not on point, and N.J.S.A 17:16I-4, NJ Multiple-Party Deposit Account Act (“MPDAA”) was controlling.

Finally, because Mullen did not produce evidence on the proportionality of the contributions in the account, the Trial Court found that the accounts were owned in equal shares between Defendant and his wife. Thus, Plaintiff was entitled to the entire balance in each of the PNC Bank joint accounts.

The Appeal

On appeal, Mullen argued that the Trial Court erred in applying the MPDAA instead of the Tenancy Act in finding that the joint accounts did not constitute property. Mullen argued that the creditor of one spouse could not execute on marital property owned as a tenancy by the entirety to satisfy a judgment. In addition to opposing that argument, the Bank contended that Mullen also withheld information concerning the source and amount of the funds in the joint accounts, that it was impossible for the Court to determine the proper amount of the funds that should be levied, and that the MPDAA is controlling.

The Appellate Division first decided whether the accounts were owned by Mullen and Kaps as tenants by the entirety under the Tenancy Act, which provides that.

“A tenancy by entirety shall be created when:

a. A husband and wife together take title to an

interest in real property or personal property under a

written instrument designating both of their names as

husband and wife; or

. . . .

Language which states "...... and ......, his wife"

or ".......... and .........., her husband" shall be deemed to

create a tenancy by the entirety.

[N.J.S.A. 46:3-17.2.]”

The Court found no evidence showing that the accounts were owned by husband and wife or any other information showing that Mullen and his wife intended to create a tenancy by the entirety. The Court rejected the “defendant's argument that the statutory language supports a presumption that a tenancy by the entirety was created. Thus, the Court concluded based upon the evidence before it that Mullen and Kaps owned the accounts jointly, rather than as tenants by the entirety under the Tenancy Act.” Because of this finding, it held it did not need to reach the question of whether the MPDAA superseded the Tenancy Act in determining ownership of joint accounts.  No matter how it was viewed, the MPDAA controlled.

The Court set forth that the MPDAA Act details,

“Unless a contrary intent is manifested by the

terms of the contract, or the deposit agreement, or there

is other clear and convincing evidence of a different

intent at the time the account is created:

a. A joint account belongs, during the

lifetime of all parties, to the parties in proportion to the

net contributions by each to the sums on deposit. In the

absence of proof of net contributions, the account

belongs in equal shares to all parties having present

right of withdrawal. [N.J.S.A. 17:16I-4.]”

The Court held that the plain language of the MPDAA reads, “[i]n the absence of proof of net contributions, the account belongs in equal shares to all parties having present right of withdrawal.” That meant to the Court that the language of the MPDAA necessitates that only one-half of the joint accounts’ funds can be levied over absent proof that one account holder contributed more funds.

In so doing, the Court pointed out, “We have previously held it is the plaintiff's burden to establish the balance in the account is ‘the individual property of the judgment debtor, and therefore applicable to the satisfaction of the judgment.’ Banc of Am. Leasing & Cap.,

LLC v. Fletcher-Thompson Inc., 453 N.J. Super. 50, 53 (App. Div. 2018).”  It found the Bank had not met that burden. As such, the Court affirmed in part and vacated in part.

For a copy of the decision, please contact Michael O’Donnell at modonnell@riker.comThomas Persico at, Kevin Hakansson at, or Kori Pruett at

Our Team

Michael R. O'Donnell

Michael R. O'Donnell

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Thomas J. Persico

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