Safe deposit boxes, frequently used by our clients to store heirlooms, jewelry, coins, securities and important papers, present estate planning issues that are frequently overlooked.  Each bank has its own rules regarding the use and access to its customers’ boxes and, for this reason, unanticipated problems arise.  Thus, for instance, if a box is owned in joint names and one of the two owners passes away, does the surviving owner have the right to collect the contents of the box and close it?  The answer to this question is, simply, “No,” although most people including some bank representatives, believe otherwise.


In New York, to secure a safe deposit box, one enters into a form of lease agreement with the bank.  There should be a signed, written contract, specifying not only the names of those who have access to the box but also the terms and conditions of the rental.  For instance, most banks will specify that cash should not be maintained in a safe deposit box and that, under no circumstances, will they be responsible for its loss.  It is important that the lessee, the person who rents the box, read the contract carefully.


Ordinarily, only persons authorized under the contract may enter the box.  A box that is leased in two names is leased jointly.  This means that, while both lessees are alive, either may freely enter the box alone, examine, remove or insert contents, and/or surrender the box.  Some banks permit the appointment of a “deputy,” one who has equal access to the box with the one who has appointed him, but only during the lifetime of the owner of the box.


The agreement will also specify the circumstances under which the bank can open the box.  Usually, if the rental fee has not been paid for a period of time or the contents of the box have not been removed following the termination of the lease, the bank has the authority, after giving notice to the owner(s), to open the box, remove the contents and sell or auction them.


What most of our clients don’t realize is that the bank also has the right to refuse access to a box if it learns that a lessee is incapacitated or has died.  This is true even if there are two names on the box and the other lessee is the one who seeks entry.  Because the bank has an obligation to safeguard the contents of the box, it can seal the box and require the personal representative or guardian of the deceased or incapacitated lessee to present authorization from the Court permitting access to the box.  This is precisely what recently happened to one of our clients.  She and her husband jointly owned a box in a bank at which they also had several joint accounts.  After his death, she wanted to remove his name from the box and authorize her child to have access.  The bank refused, demanding that she secure Letters Testamentary from the Court.


Other things to know:


-The contents of the box are not insured by the FDIC or by the bank – since noone but you knows what’s inside. You can insure the contents privately.


-You should keep a complete list and description of all items in your box together with proof of ownership where applicable.


-Deeds, car titles, insurance policies, even birth and death certificates, are easily replaceable and need not be kept in a safe deposit box.


-Your Will should never be kept in your safe deposit box because, after your death, when the Will is needed, access may be denied by the bank and a special proceeding may be required in order to secure the Will for filing.


-Boxes are not indestructible. The Chase vault was incinerated during 9/11 and numerous banks were inundated by flood waters and their vaults destroyed during hurricane Katrina.