49. ‘X’ and ‘Y’ maintain a Joint Savings Bank Account. ‘Y’ informs the bank that ‘X’ is dead and produces a death certificate thereof. ‘Y’ requests the banker for the payment to him of the balance in the account. What would you do as a banker? Decide.

Facts of the case

• X and Y maintain a joint savings bank account.
• Y informs the banker that X has died and submits X’s death certificate.
• Y requests payment of the entire balance in the account.

Issues in the case

• Can the banker pay the entire amount to Y after the death of X?
• What is the correct procedure for handling joint accounts upon the death of one account holder?
• Does the mode of operation or mandate (e.g., “either or survivor”) affect the banker’s decision?

Principles associated with the case

• In joint accounts, the mandate given at the time of account opening governs how the account is to be operated after the death of one holder.
• If the mandate is “either or survivor”, the surviving account holder (Y) is entitled to the balance.
• If there is no specific mandate, then the balance should be settled according to the legal succession rights of the deceased (X).
• The banker has a duty of care and must follow the original account terms and legal formalities to avoid liability.

Judgement

• If the account was operated under an “either or survivor” clause, the banker may rightfully pay the balance to Y.
• If no such mandate exists, the banker must not release the full amount to Y alone. Instead, payment should be made jointly to the legal heirs of X and Y, or after proper succession certification.
• The banker must verify the mode of operation before making any payment to avoid breach of duty and potential legal disputes.