In 2006, Mike Sanchez (Mike) visited a local branch of Wells Fargo Bank (Bank) in order to change the status of his accounts. In light of the recent death of his wife, Mike wanted his two sons, Joe and Gilbert, to be able to assist him with the payment of bills and other financial matters. Mike was advised by the Bank to close his existing accounts and open new ones. Mike completed a “Consumer Account Application” in which he was denominated the “Primary Joint Owner” and his sons were denominated “Secondary Joint Owners.” Mike signed the application, and the joint accounts were opened.
In October 2006, a writ of garnishment was issued in connection with a civil lawsuit in which Carmen and Isidro Alcantar (Alcantars) had obtained a judgment against Joe. The writ, which was addressed to the Bank, identified Joe as the judgment debtor and specified that the outstanding balance exceeded $36,000. In its answer, the Bank indicated that it owed Joe $17,474.77. This was the entire amount held in the accounts held jointly by Mike, Joe, and Gilbert. The Bank took immediate possession of all of the funds, such that none of the joint account owners could access them.
Mike filed a motion to intervene, asserting that he was in fact the sole owner of all funds in the accounts and contending the garnishment was wrongful. After the motion was granted, Mike filed a complaint against the Bank, claiming conversion of the funds. The Bank filed a motion for summary judgment in which it contended its seizure of the funds was in accordance with the terms of the consumer account agreement as well as the law pertaining to garnishment. The district court found in the Bank’s favor and granted summary judgment with respect to all of Mike’s claims. Mike appealed to the New Mexico Court of Appeals
JUDGE KENNEDY “Conversion is the unlawful exercise of dominion and control over property belonging to another in defiance of the owner’s rights, or acts constituting an unauthorized and injurious use of another’s property, or a wrongful detention after demand has been made.” Sec. Pac. Fin. Servs. v. Signfilled Corp., 956 P.2d 837 (N.M. Ct. App. 1998). In his complaint, Mike avers that the Bank converted his property when it seized the funds held in his accounts. The Bank’s conduct is alleged to have been unlawful, unauthorized, and/or wrongful, insofar as notice and joinder were not accomplished as required by law, and insofar as all of the funds actually belonged to Mike, rather than the judgment debtor identified in the writ. The Bank successfully argued it was entitled to summary judgment as its conduct was in compliance with the writ.
The writ of garnishment issued by the court was in the general, statutorily specified form. It orders the Bank to file an answer, keep any money that is owed to the judgment debtor in sufficient quantity to satisfy the outstanding indebtedness and mail copies of the writ, the application, the answer, and the claim of exemption forms to the judgment debtor within four business days.
Superficially, the Bank’s conduct appears to have been in compliance with the terms of the writ. The difficulty arises, however, when the identity of the judgment debtor is considered. As the writ clearly specifies, the only judgment debtor was Joe. Accordingly, only monies owed by Joe were subject to seizure. See NMSA 1978, § 35-12-3(A), (C) (1969) (providing that “service of a garnishment on the garnishee has the effect of attaching all . . . money . . . of the defendant in the garnishee’s possession or under his control at the time of service of the garnishment” and that after service, “it is unlawful for the garnishee to pay to the defendant in the action” any money attached by the garnishment (emphasis added)). It is therefore questionable whether the Bank’s act of seizing all the funds contained in the accounts jointly held by Mike, Joe, and Gilbert could be said to conform with the writ.
To our knowledge, no authority in New Mexico directly addresses the handling of joint accounts in situations like this. A broad variety of approaches have been taken in other jurisdictions. See generally Martha A. Churchill, Annotation, Joint Bank Account as Subject to Attachment, Garnishment, or Execution by Creditor of One Joint Depositor, 86 A.L.R. 5th527 (2001). Where joint bank accounts are the subject of garnishment, statutory provisions and case law provide limited guidance. Ownership of multiple-person accounts is addressed in NMSA 1978, Section 45-6-211(B) (1992), which provides that “[d]uring the lifetime of all parties, an account belongs to the parties in proportion to the net contribution of each to the sums on deposit, unless there is clear and convincing evidence of a different intent.” In this context, “net contribution” is defined in pertinent part as “the sum of all deposits to an account made by or for the party, less all payments from the account made to or for the party which have not been paid to or applied to the use of another party.” Section 46–6–211(A).
Accordingly, absent clear and convincing evidence of a different intent, the ownership of the funds at issue in this case corresponded with net contributions. Insofar as a judgment creditor acting under a writ of garnishment can only seize the property that belongs to the judgment debtor, arguably only Joe’s net contributions to the accounts should have been subject to seizure pursuant to the writ of garnishment.
Although the foregoing principles seem relatively simple in the abstract, difficulties arise with respect to their practical application. As the Bank has argued, garnishees may not have sufficient information at their disposal to perform the “net contribution” calculation when served with a writ. Accordingly, we understand the Bank to contend that seizure of the entire amount held in a joint account should be deemed appropriate whenever a writ of garnishment identifies any co-owner of a joint account as a judgment debtor.
Upon careful consideration, we conclude that the approach advocated by the Bank is at odds with the basic propositions articulated above, concerning the ownership interests of joint account holders and judgment creditors’ ability to garnish only property belonging to judgment debtors. We therefore reject the Bank’s argument that the seizure of all of the funds held in the joint accounts, without any acknowledgment of or concession to the interests of the nondebtor co-owners, was in accordance with law.
e recognize that banking institutions may be placed in a difficult position when presented with a writ of garnishment in a case such as this where a joint account exists and only one of the co-owners is identified as a judgment debtor. Immediate resort to interpleader, together with payment of all disputed monies into the court registry, may be the most appropriate response. Alternatively, placing a brief hold on the account and promptly engaging in a reasonable investigation might be permissible. However, neither of those approaches was taken in this case. Instead, as previously stated, the Bank acted on the writ by seizing all funds in the joint accounts and sending the standard paperwork to the judgment debtor, disregarding entirely any interests of the other named co-owners.
In summary, we conclude that the foregoing authorities provide sufficient support for the claim of conversion to render the award of summary judgment to the Bank improper, and we reverse.


What requirements did the Bank disregard with respect to its response to the writ of garnishment? What should the Bank have done to avoid the result in this case? How could the Bank have been expected to proceed given the absence of settled law on the status of joint accounts and the need for an immediate response to the writ of garnishment?


What conclusions do you reach when analyzing the parties’ behavior from an ethical standpoint? From the Bank’s standpoint, was its behavior a good faith attempt to comply with the writ, or did it simply disregard the interests of one of its customers? What expectations did Mike have as a customer with respect to the Bank’s behavior in general and its response to the writ of garnishment in particular? Does the court’s holding encourage unethical behavior by individuals seeking to shield assets from creditors through utilization of joint accounts? Why or why not?

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