Joint bank accounts can be a convenient way for two people share income and expenses, and, in the case of a married couple, they can be used as a way to avoid estate administration tax. This is because joint account provides a right of survivorship, which allows the account’s ownership to transfer to one person if the other person on the account passes away. Despite those conveniences, there are some things to keep in mind when it comes to joint accounts, particularly when they are shared by two people who are not married, for example, parents and their grown children.

The Supreme Court of Canada Weights In

The Supreme Court of Canada addressed this in its 2007 decision in Pecore v. Pecore. The effect of the Supreme Court’s decision was that when assets are held between a parent and a child, there will be a presumption of “resulting trust” if the parent dies. In short, this means there is a presumption that the funds in a joint account were intended to revert to the parent’s estate (i.e. the assets would be returned to the estate of the parent). This applies most often in situations where an aging parent may have a joint account with one of their grown children, who then uses the funds in the joint account to care for the parent.

The Intent to Gift

However, there are situations where a parent intends to give money that resides in a joint account to their child. The Supreme Court recognized this in the Pecore decision. The court found that if a parent makes their wishes clear, the funds in a relevant joint account would go to the child. If that intention was not made clear by the parent, the adult child could rebut the presumption, or in other words, show that the intent was not for the funds to revert back to the parent’s estate. In order to do this, the adult child would have to present evidence supporting the argument that the deceased parent wanted the funds to remain with the child.


There are a number of factors a court would look at when determining what a parent’s intention was. They include:

  1. Who controlled the money once the account was created, including depositing, transferring, and spending of money.
  2. Do any bank documents exist that address the right of survivorship?
  3. Whose funds were deposited into the account?
  4. Was a power of attorney given to the child, or other account holder?
  5. Who paid the taxes on interest earned in the account?
  6. Is there any evidence that the parent was aware of the consequences of creating a joint account?
  7. What was the relationship between the parent and child?

If you are setting up a joint account with an adult child, or someone else, and want to ensure the funds in the account remain with that person upon your death, it would be prudent to prepare evidence supporting this. A Deeds of Gift document is a formal document confirming that someone is giving away, or gifting, an asset to another person while they are still alive. Additionally, a Declaration of Intent can be used to grant the right of survivorship of a joint account (or other shared asset). As with most matters involved with the planning of an estate, it is always best to carefully plan what you want to happen to your assets when you pass, and to make those plans explicitly clear in your will and in other documents. NULaw offers a wide range of services to help you draft a will, or address other issues arising in estate planning. Contact us online or by phone at 416-481-5604 to schedule a consultation today.

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