who shall receive the money of a deceased bank account-holder

Published by The Daily Star | December 12, 2017 (Link Here) 

This week Your Advocate is Barrister Omar Khan Joy, Advocate, Supreme Court of Bangladesh. He is the head of the chambers of a renowned law firm, namely, ‘Legal Counsel’, which has expertise mainly in commercial law, corporate law, family law, employment and labor law, land law, banking law, constitutional law, criminal law, IPR and in conducting litigations before courts of different hierarchies. Barrister Omar Khan Joy Query My paternal uncle passed away recently, he and I shared a very close relationship and he always took keen interest in my life and wellbeing. My uncle was a very successful businessman and consequently he had multiple bank accounts in various banks in Bangladesh. After his death, I came to know that he nominated me as the nominee of one of his bank accounts. My aunt is now telling me that I will not get any such money. My uncle left behind his 4 legal heirs, namely, his wife and 3 children (1 son and 2 daughters). In such circumstances, I would like to know what would be my legal rights as nominee of the account. Tawaaf Shamsi Dhaka Response Thank you very much for your query. Your query is very relevant to the time as there has been some upheaval surrounding the issue recently. The scheduled banks in Bangladesh are mainly governed by the provisions of the Bank Companies Act 1991 which came into force on 14thFebruary 1991. As per Section 103 of the Bank Companies Act 1991,where an individual has deposits money with a banking company in his/her name, that individual depositor may in the way prescribed, choose a person to whom, in the case of his/her death the deposited money shall be given. In the event the person chosen is a minor, the depositor in the prescribed way shall direct who shall, in the case of the death of the depositorwill receive the money during the period of minority of the chosen person. After the death of the depositor the nominee attains all the rights of the individual depositor that he/she had on that deposit, and every other person shall be deprived of those rights.When a banking company has made payments in accordance with Section 103 of the Bank Companies Act 1991 all its obligations in respect of the deposit concerned shall be deemed fulfilled. Moreover, this legislative provision takes precedence over any other law (e.g. law of inheritance). As you can see in the preceding paragraph that the position in law is very clear as to the rights of Nominee of an account. In light of Section 103 of the Bank Companies Act 1991 your (Tawaaf) legal right to the money laying in your late uncle’s account as nominee is absolute. On 3 April 2016, the hon’ble High Court Division of the Supreme Court of Bangladesh delivered a historical judgment in establishing right of the legal heirs as against that of the nominees. The hon’ble High Court bench said that as per the law the nominee is a trustee and agent only. The deposited money of the deceased person will have to be divided among the heirs as per Shariat Law (in case of Muslims), the court added.According to this judgment of the High Court the nominee would merely hold the money as trustee and thus would be obliged to distribute the money among the legal heirs of the account holder. The judgment of the hon’ble High Court has subsequently been stayed by the hon’ble Appellate Division. Moreover, you may be glad to know that the Bangladesh Bank which is the prime regulator of scheduled banks in Bangladesh has issued a circular (DFIM Circular No. 2) dated 15th June 2017 restating the original position reflected in Section 103 of the Bank Companies Act 1991. The said circular was issued to managing directors or chief executive officers of all the scheduled banks of Bangladesh, it states that in the event of death of the depositor all money in the account of the depositor may be given to the nominee. Following the High Court Ruling, It had been noticed that some of the scheduled banks were taking affidavit from nominees of depositors saying that the nominees may not be eligible to receive the deposited money after the death of the account holders. The rights of the nominee of a bank account are enshrined in Section 103 of the Bank Companies Act, consequently taking affidavit from the nominees is violation of Section 103 of Bank Company Act 1991. The scheduled banks were taking affidavit in connection to the High Court ruling establishing right of the legal heirs as against that of the nominees. However, with the advent of the Bangladesh Bank circular (DFIM Circular No. 2) dated 15th June 2017 the muddled water has been settled and we got the much needed clarity on the subject matter. It is therefore settled now the nominee attains all the rights of the depositor that he/she had on that deposit in the event of his/her death. In light of the discussion above it therefore transpires that you will be entitled to get the money deposited in your late uncle’s account in issue and your receipt of the same does not run counter to any legal rights on your uncles legal heirs. For detailed query contact: [email protected].