Varela v. Bernachea

Carlos Alberta Bernachea, a married man with children, commenced a relationship with Cristina Varela, a fellow Argentinean citizen. Approximately a year into their relationship Bernachea asked Varela to stop working and move into his condominium to live with him. Varela moved in with Bernachea who paid all of her expenses and after a few months, added her to his Merrill Lynch CMA account as a joint tenant with right of survivorship, and she was given a check card for accessing the account. The couple also had a joint account at Southtrust. Bernachea then suffered a heart attack and Varela stayed with him at the hospital until his daughters arrived and prevented Varela from staying with him. They also directed Varela to vacate the apartment, which she did willingly. About a week later, on October 25, 2002, Varela wrote a check for $280,000 on the Merrill Lynch account and deposited the funds in her personal account. After being released from the hospital, Bernachea disputed Varela’s right to use the joint account and instructed Merrill Lynch to return the funds. Merrill Lynch did so and would not return the funds to Varela when she objected. At trial Bernachea claimed that Varela’s access to the account was restricted and that she did not have the authority to write checks on the account. Jorge Herrera, Bernachea’s banker, testified that he explained to Bernachea in English and Spanish the significance of adding Varela as a joint tenant and Bernachea, a retired attorney, did not indicate that he did not understand. Herrera and his assistant also testified that they were not instructed by Bernachea to restrict Varela’s access to the account. Bernachea also asserted that Varela’s account access was restricted to use of the check card and that she only had full access to the Southtrust account. Varela responded that she had full access to both accounts and that they opened the Southtrust account simply for convenience because it was nearby. The trial court ruled in favor of Bernachea, finding he lacked donative intent when he added Varela to the Merrill Lynch account. Varela appealed.