528 B.R. 912
Bankr. W.D. Mo.2015Background
- Debtor Randi Haines (Missouri resident) filed Chapter 7; husband did not guaranty debtor’s business debt; no joint unsecured creditors exist.
- About a year after filing, debtor amended schedules to claim as exempt a UBS brokerage account titled jointly with her husband, valued ~ $200,000, asserted as tenancy by the entirety (TBE).
- UBS account application (signed by both) listed ownership options and had the box for “Joint Tenants with Right of Survivorship” (JTWROS) checked; neither spouse understood the legal distinctions and both testified they intended a joint marital account.
- Trustee objected, arguing the checked JTWROS box (and account documents) showed the account was not TBE and therefore not exempt; trustee sought to override exemption.
- Court held an evidentiary hearing, received testimony and the account application, and found the spouses credible but without specific intent to create a non‑entireties form of ownership.
Issues
| Issue | Plaintiff's Argument (Trustee) | Defendant's Argument (Haines) | Held |
|---|---|---|---|
| Whether Missouri’s TBE presumption arises for the UBS brokerage account | No — account documents (JTWROS box checked) show ownership was specified as joint tenancy so presumption does not arise | Yes — common‑law presumption of TBE applies to married couples’ joint property and arises here | Presumption of TBE arises under Missouri common law (applies to this account) |
| Whether checking the JTWROS box on the account application rebuts the TBE presumption | Yes — the written account designation controls; parol evidence should be barred | No — mere checking of JTWROS without an explicit disclaimer or other strong evidence is insufficient to rebut presumption; extrinsic evidence may be considered | Checked JTWROS box alone (without a specific disclaimer or strong evidence) does not rebut the presumption; trustee failed to meet heightened rebuttal standard |
| Whether parol evidence (spouses’ testimony about intent) is barred by the parol evidence rule | Parol evidence should be excluded because the account application is an integrated written contract | Parol evidence admissible: (1) the trustee is a stranger to the contract (stranger exception), and (2) the writing is ambiguous in context | Parol evidence rule does not prevent consideration of spouses’ testimony (stranger exception); even on documents alone result is the same — box insufficient to rebut presumption |
Key Cases Cited
- Scott v. Flynn, 946 S.W.2d 248 (Mo. Ct. App. 1997) (JTWROS designation without an explicit disclaimer does not negate TBE presumption)
- Brown v. Mercantile Bank of Poplar Bluff, 820 S.W.2d 327 (Mo. Ct. App. 1991) (addition of third party to an account did not defeat spouses’ TBE interest)
- Edgar v. Ruma, 823 S.W.2d 59 (Mo. Ct. App. 1991) (account language providing joint ownership with right of survivorship created TBE)
- Nelson v. Hotchkiss, 601 S.W.2d 14 (Mo. 1980) (once TBE presumption arises, rebuttal requires clear, cogent, convincing evidence)
- In re Stenzel, 301 F.3d 945 (8th Cir. 2002) (burden rules for objections to claimed exemptions under Fed. R. Bankr. P. 4003(c))
- In re Garner, 952 F.2d 232 (8th Cir. 1991) (creditors of one spouse cannot reach TBE property)
Decision: Trustee's objection to debtor's exemption overruled; account treated as tenancy by the entirety and exempt under Missouri law.