## Facts

- Leo Gubala died intestate, leaving nine nieces and nephews as his heirs at law.
- Before his death, Gubala maintained a deposit account at Fairfield Federal Savings and Loan Association (Fairfield).
- While alive, Gubala authorized Fairfield to change the account so that, on Gubala’s death, the account would be payable to his nephew, Frank Wujastyk.
- After Gubala’s death, another nephew (an heir at law) filed suit seeking a declaration that the funds in the Fairfield account belonged to the probate estate.
- The heir argued that directing payment of the account to Wujastyk at death was a testamentary disposition that failed because it did not comply with Illinois will-execution requirements.
- The trial court ruled for Wujastyk, concluding that the Illinois Savings and Loan Act authorized this type of account and that the funds were not estate property.
- The challenging heir appealed.

## Issues

1. Whether a savings-and-loan account made payable to a named beneficiary on the depositor’s death, pursuant to the Illinois Savings and Loan Act, is an invalid testamentary transfer for lack of will formalities or a valid statutory transfer outside probate.

## Decision

- The appellate court affirmed the judgment for Wujastyk.
- The court held that the Illinois Savings and Loan Act authorized the payable-on-death form used for the Fairfield account.
- Because the account was created under that statute, the direction to pay Wujastyk at Gubala’s death was effective and the account proceeds did not become part of Gubala’s intestate estate.

## Legal Principles

- A legislature may create statutory methods for transferring certain property at death that operate outside probate and are not governed by the Statute of Wills.
- A payable-on-death designation on a savings-and-loan account, when made in the form authorized by the Illinois Savings and Loan Act, is enforceable according to the statute’s terms even though the beneficiary’s right arises at death.
- Statutory payable-on-death accounts are treated as a valid arrangement between the depositor and the financial institution, rather than a will, so will-execution formalities do not control.
- When a specific statute authorizes a particular account form and directs how the funds are to be paid at death, courts give effect to that statute instead of recharacterizing the account as an attempted will.

## Conclusion

The court affirmed a ruling that Leo Gubala’s Fairfield savings-and-loan account, changed during his lifetime to be payable on death to Frank Wujastyk, transferred to Wujastyk under the Illinois Savings and Loan Act and did not pass through Gubala’s intestate estate despite the lack of will formalities.


In re Estate of Gubala, 225 N.E.2d 646 (1967)