Case ID: ny_55/html/0624-01.html
Source: Caselaw Access Project
Author: {"author": "Grover, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Eveline J. S. Shuttleworth, Respondent, v. Catharine R. Winter, Administratrix, etc., Impleaded, etc., Appellant.
    Tlie question of granting a new trial upon the ground that the applicant was misled by an intimation of the court as to the state of the issue presented, or as to the proper disposition to be made thereof, or whether in consequence-thereof a rehearing upon such issue, or any part of it, will be granted, is in the discretion of the court below, and its determination cannot be reviewed by this court.
    A gift is not rendered invalid because of the existence of the relation of husband and wife between the donor and donee; but the fact of the gift having been made must be clearly proved.
    S., being about to leave home to remain a considerable time absent from the country, placed a quantity of U. S. coupon bonds in a tin box, with a card thereon, upon which was written the name of his wife; the hex he deposited in a bank, leaving the key with his wife. During his absence these bonds were, by his direction, exchanged by the wife for five-twenty bonds, registered in the name of both. S. died abroad. Held, that these facts did not so conclusively prove a gift as to authorize this court to decide that a finding to the contrary was error of law. Some time prior to the death of S., his wife sold $4,000 of the bonds and purchased therewith a house, taking the title in her own name. In the settlement of her accounts, as administratrix of his estate, she was charged with the avails of said bonds. Held, error; as the intestate had no such personal property at the time of his death.
    (Argued January 27, 1874;
    decided February 3, 1874.)
    
      It seems, also, that the wife could not be charged therewith as a debt in an action against her in her individual capacity. A wife does not become the debtor of her husband by an unauthorized use of property intrusted to her by him. If she therewith purchase other property, his remedy is to rescind her contract and recover the property if it can be reached; if not, to take what was received therefor. He cannot treat this as her separate estate, and charge her with the value of the property misappropriated.
    An executor or administrator is not chargeable with interest not received by him, unless it appears that he has used the money himself, or that with reasonable diligence interest might have been received.
    There are three appeals in this case. First, an appeal from an order of the General Term of the Supreme Court in the second judicial department, affirming an order of Special Term denying a motion, on behalf of defendant Winter, for a new trial, or for a hearing before the referee appointed to take and state her accounts, on certain questions wherein said defendant claimed to have been misled by remarks of the judge before whom the cause was tried. Second, an appeal from an order of said General Term, affirming an order denying a motion for new trial upon case and exceptions. Third, an appeal from a judgment of said General Term, affirming a judgment entered upon the decision of the court at Special Term, and the report of a referee settling the accounts in accordance with said decision.
    This action was against defendant, individually, and as administratrix of the estate of William H. Smyley, deceased, for an accounting and distribution of his estate. The principal question litigated was as to the title to some $42,750 United States bonds which defendant, Mrs. Winter, claimed as a gift from the intestate, her former husband.
    In the spring of 1866, said Smyley was the owner of $40,000 United States treasury notes or coupon bonds ; being about to go as United States consul to the Falkland Islands, he placed the notes in a tin box, to which was attached a card upon which was written the name of his wife, now Mrs. Winter, the defendant. This box he locked and deposited in the Marine Bank, giving the key to his wife. After the departure of Mr. Smyley, other United States bonds to the amount of $2,150, realized from the sale of property, were placed by Mrs. Smyley in the box. Mr. Smyley, by letter, authorized his wife to exchange the notes for five-twenty United States bonds, to be registered in her own or in their joint names. Under this authority she made the exchange, the five-twenty bonds received being registered in their joint names. The court held that the registration was without any intent that defendant should be entitled to the bonds in case she survived her husband, and that there was no gift oí the bonds, and appointed a referee to take and state the accounts. An order was entered in conformity with this decision. On appeal from this order, and on motion for a new trial, on case and exceptions, the General Term affirmed the order and denied the motion; adjudging, however, that “ said order for judgment shall not be conclusive upon the parties thereto, as to the amount of bonds for which the defendant, Winter, shall account on the reference.”
    On the hearing before the referee, he held that no evidence was admissible as to the title of the bonds on hand at the time of the death of the intestate, as that question had been settled by the Special Term. The referee charged the defendant, Winter, in the accounting, with the full amount of the bonds.
    Further facts appear in the opinion.
    
      George H. Forster for the appellant.
    An administrator is only charged interest when guilty of negligence in omitting to invest the money of the estate, or when he has used it to his own profit. (2 Williams on Exrs., 1567, and cases cited; Wyman v. Hubbard, 13 Mass., 231; Stearns v. Brown, 1 Pick., 530; King v. Talbot, 40 N. Y., 76 c, 96; Bruere v. Pemberton, 12 Ves., 386.) The delivery of the coupon bonds by the intestate to defendant was a valid gift. (Borst v. Spelman, 4 N. Y., 284; Allen v. Cowan, 23 id., 502; Bedell v. Carll, 33 id., 581; Hatheway v. Payne, 34 id., 106 ; Westerlo v. Dewitt, 36 id., 340; Phillips v. Wooster, id., 412; Freeman v. Freeman, 43 id., 34; Grymes v. Hone, 49 id., 17.) The legal consequence of the joint registration of the bonds is, that if the wife outlived the husband, who died without other disposition of the property, she took the whole by survivorship. (Craig v. Craig, 3 Barb. Ch., 76, 78, 104; Rogers v. Benson, 5 id., 431; Jackson v. Stevens, 16 J. R., 110; Sutliff v. Forgay, 1 Cow., 89; R. C. O. Asylum v. Strain, 2 Brad., 34; Torrey v. Torrey, 14 N. Y., 430; Goelet v. Gori, 31 Barb., 314, 320; F. & M. Bk. v. Gregory, 49 id., 155.) The transfer to defendant was stronger evidence of an intention to give than a purchase. (George v. Bk. of England, 7 Price, 646; Rider v. Kedden, 10 Ves., 360; Low v. Carter, 1 Beav., 426; Vance v. Vance, id., 605; Lucas v. Lucas, 1 Atk., 270; Williams on Ex., 714.) Defendant was entitled to a rehearing before the referee or a new trial. (Abrams v. Winship, 1 Russ., 526; Ore v. Johnson, Seaton’s Decrees, 363; Hodson v. Merest, 9 Price, 563; Church v. Freeman, 16 How., 294; Buchanan v. Cheeseborough, 5 Duer, 238; Hains v. Clark, 4 How., 78; Cruger v. Douglass, 2 N. Y., 571; Swarthout v. Curtiss, 4 Comst., 415.)
    
      Daniel T. Walden for the respondent.
    Plaintiff could maintain an action for an accounting against defendant in the Supreme Court. (Rogers v. King, 8 Paige, 210; Wood v. Brown, 34 N. Y., 337, 345.) There was not sufficient evidence to establish a gift of the bonds by the deceased to his wife during his life. (2 Kent’s Com. [10th ed.], 589, 590; 1 Bouv. Inst., 710-712; Grangiac v. Arden, 10 J. R, 293, 296; Bedell v. Carle, 33 N. Y., 581, 584; Neufvill v. Thompson, 3 Edw. Ch., 92; Jennings v. Davis, 31 Conn., 134; Skillman v. Skillman, 2 Beas. [N. J.], 403; 1 Bish. L. of M. Women, § 731; Little v. Willets, 55 Barb., 125, 129; Kenny v. Pub. Admr., 2. Brad., 321.) To establish a gift from a deceased husband to his Avife the AvidoAV must produce evidence beyond suspicion. (Jennings v. Davis, 31 Conn., 138; Paskell v. Hall, 5 Jones Eq. [N. C.], 108, 109; Williams on Ex. [6 Lond, ed.], 715; Walker v. Hodge, 2 Swanst., 92, 97; S. C., 1 Wils. Ch., 445; Hoges v. Kindersley, 2 Sm. & G., 197, 198; Skillman v. Skillman, 2 Beas. [N. J.], 407; Dilto v. Stevenson, 17 N. J. Eq., 407, 412, 413.) The testimony of conversations between defendant and her deceased husband were properly excluded. (Ressequie v. Mason, 58 Barb., 89, 99; Grahan v. Chrystal, 37 How. Pr., 279; Grey v. Grey, 47 N. Y., 553.) The order denying a motion for a new trial on the ground of surprise was addressed to the discretion of the court below, and is not appealable to this court. (Lawrence v. Ely, 38 N. Y., 42; Tracey v. Welch, 46 id., 298; Scofield v. London, 50 id., 686.) Defendant’s laches in not moving for a new trial immediately would prevent the granting of a new trial. (Peck v. Hiler, 30 Barb., 655, 658; People v. Marks, 10 How., 623.) The surprise claimed is not such as would induce the court to grant a new trial. (Beekman v. Bemus, 7 Cow., 29; Taylor v. Harlow, 11 How. Pr., 285.)
   Grover, J.

Whether a new trial of the issues determined by the Special Term should have been granted, upon the ground that the appellant or her counsel was misled by an intimation of the judge as to the state of the question presented or the disposition proper to be made of it, or whether in consequence of this any hearing upon such issue or any part of it should be had before the referee, were questions addressed to the discretion of the court, and the determination thereof by the General Term cannot' be reviewed by this court. The appeal from the order of the General Term, affirming the order of the Special Term denying the motion of the appellant for such new trial or hearing, must be dismissed.

The questions arising upon the appeal from the order denying a new trial upon the exceptions taken by the appellant, and upon the appeal of the same party from the judgment, are so nearly identical that a separate consideration is unnecessary. The appellant excepted to the finding of the Special Term that there was no gift of the government bonds amounting to $42,750 by the intestate to the appellant. This exception raises the question in this court whether the evidence conclusively proved that such gift was made by him to her. The relation of husband and wife, existing between the donor and donee at the time of the alleged gift, would not render it invalid; if in fact made, equity will sustain and enforce it. (2 Kent’s Com. [10th ed.], 589, 590; Kingdon v. Bridges, 2 Vern., 67; Draper v. Jackson, 16 Mass., 480; Williams on Exrs., 714.) But the fact of the gift having been made must be clearly proved. (Jennings v. Davis, 31 Conn., 138; Walter v. Hodge, 2 Swanston, 92; Williams on Exrs., 715; Mews v. Mews, 15 Beavan, 529.) In this case as presented in this court, as we have seen, the proof must be conclusive, otherwise it would not be an error in law which can be corrected by this court; an examination of the evidence upon the trial fails to show this. It was proved that the intestate, at the time of leaving his home to remain for a considerable time absent from the country, had about $40,000 in United States coupon treasury notes; that just before leaving he procured a tin box, placed the notes therein, with a card, with the name of his wife (the appellant) placed thereon, and deposited the box in a bank, leaving the key with her; that during his absence these notes were exchanged by the direction of the appellant into government coupon five-twenties; that his wife wrote him in relation thereto, but the contents of her letters were not shown. In answer, the intestate wrote her that she might procure bonds registered in her name or in the names of both; that she' did thereafter procure, for the coupon bonds, bonds registered in both their names. This failed to show that ■ the intestate intended to divest himself of all title to the bonds and vest them in his wife. As he was leaving, perhaps for years, some one must have the custody of the treasury notes. The interest thereon was to be collected and the proceeds applied ‘to the support of his wife and children. Having entire confidence in his wife the property was placed in her custody and control; she collected the interest and applied it to the purposes intended. When it was deemed prudent, for safety, registered bonds were procured, and to enable the wife to collect the interest thereon her name was used in the registration. All this was consistent with an intention of •the intestate to retain his title to the bonds. Had he remained in the country, where he could have attended to this business himself, and had himself procured bonds to be registered in the names of both, a different inference would arise. In such a case, the presumption would be that he intended that the wife should have them, in case of his death leaving her surviving. I have not -referred to the testimony upon this point taken before the referee upon the accounting; that is not properly before the court upon this question. The conclusion of the referee, that this question was disposed of by the Special Term, was correct. I will, however, remark that I have examined all the testimony upon this point, taken by the referee, and that if this should be considered in connection with that at the Special Term it would not change the result.

The General Term, upon appeal, modified the judgment of the Special Term by providing that the judgment should not be conclusive as to the amount of the bonds which were the property of the intestate at the time of his death, and for which the appellant was accountable as administratrix. This was a question to be determined by the referee. Upon the hearing before him, it was conclusively proved that $4,000 of the bonds were sold by the appellant some ten months before the death of he intestate, and the proceeds paid by her upon the purchase of a house, the title to which she took in her own name, and evidence was given strongly tending to show that this was done with the approbation of the testator. The referee, nevertheless, charged the appellant with these bonds, together with the interest that would have accrued thereon, the same as if they had not been sold. This was error. The intestate had no such personal property at the time of his death. This had been converted into real estate, and the appellant was not accountable therefor as personal property. It is insisted by the counsel for the respondent that, conceding this to be so, she became the debtor of her husband for the bonds so used, and, as the action was brought against her in her individual as well as representative capacity, this debt may be recovered in the action. In this I cannot concur. A wife does not become the debtor of her husband by making an 'extravagant or unauthorized use of property which he intrusts to her management and control. If she therewith purchases property, real or personal, without authority, his remedy is to rescind the contract and recover from the vendors what they have received, if he can, and if he cannot, he must take the property purchased. He cannot treat this as her separate estate and charge her with the money she paid therefor. The law creates no such liability of the wife to the husband as a consequence of her dealing with his property. But it is hardly necessary in this case to pass upon this question, for the reason that, as I think, the referee should have found that this entire transaction was approved of at the time by the intestate.

The referee also erred in charging the appellant with interest upon the money she placed in the hands of Deforest & Co. at seven per cent, while she received only four and five per cent therefor. It appears that they acted as her bankers. An executor or administrator is not chargeable with interest not received by him, unless it appears that he has used the money himself, or that by reasonable diligence interest might have been received. There is nothing whatever in this case showing that the appellant could have obtained any more interest upon this money, or that she was guilty of any fault in this respect.

. The order denying a new trial mast be affirmed, and the judgment modified by deducting from the amount of the personal estate of the deceased, with which the appellant is charged, the $4,000 of bonds sold in the lifetime of the testator, with the interest computed thereon; and a further deduction therefrom must be made of the amount of interest upon money in the hands of Deforest & Co., charged to her in excess of the sum received by her therefor, and that the amounts to be paid to each of the parties entitled to distributive shares be reduced so as to corre-, spond therewith, and that, as so modified, the judgment be affirmed, without costs in this court to any of the parties.

All concur, except Allen, J., not sitting.

Judgment accordingly.