Case ID: mills-surr_2/html/0239-01.html
Source: Caselaw Access Project
Author: {"author": "CokstocK, S.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Matter of the Judicial Settlement of the Account of Peter Rose, as the Executor of the Last Will and Testament of Philip B. Rose, Deceased.
    
      (Surrogate’s Court, Rensselaer County,
    
    
      Filed May, 1901.)
    1. Gift Inter Vivos — -Avoided by Donor’s Detention of Control — Code C. P., § 829.
    A testator deposited, nine months before his death, money in a bank in his own name, “ In the event of death payable to Peter Rose,” his executor and brother and who was with him, and at the same time filed an order with the bank directing payment to Peter in case of his own death. He also had said to the bank officials “ I want my brother Peter to have this money.” Fifteen minutes aft^p the deposit, but before the parties had left the bank, the testator gave Peter the bank book and said, “ There is the book and there is your money.”
    
      Meld, that the gift must be treated as one inter vivos, that the testator evidently intended to retain control of the deposit during his life, that the gift was conditional and therefore void as a gift, and was not enforcible as a trust, for Peter, either in the bank or in the testator.
    2. Same — Account of Executor — Evidence where Attempt to Surcharge.
    Where a special guardian for infant legatees seeking to surcharge the accounts of the executor by the amount of the bank deposit, cross-examines the executor as to the transaction of gift, the executor is entitled to prove the whole transaction and conversation had by him with the testator, although part of it occurred fifteen minutes after the deposit,- but before the parties had left the bank.
    Affd. 75 App. Div. 615.
    Proceedings upon the judicial settlement of the account of an executor.
    J. A. Cipperly, for executor; Clarence W. Betts, special guardian of infant legatees, contestants.
   CokstocK, S.

— T-be contestants, wbo are grandchildren of the testator and residuary legatees under his will, appear by their special guardian and object to the account on file, in that it does not include, as an ¡asset of this estate, a certain deposit of $2,000, made by testator, in the Powers Bank of Lansing-burgh, and which remained there until his death, and they ask that the account be surcharged in that amount with interest. The executor claims; the same was given to him by the testator in his lifetime, and hence that it comprises- no part, of his estate. The special guardian, in order to- maintain his contention, called the executor as a witness and proved by him that he and his brother, the testator, on the 19th day of September, 1898, which was nine months before the testator’s death, went to Schenectady to draw -some money which was coming to the latter from the estate of his deceased wife. That the sum then received wais $2,000. That on their return home they went to a bank in Lansingburgh. The witness then details what occurred then, as follows;: “He (meaning testator) stepped up and said he wanted to put $2,000 in the bank there and asked them if they would receive it and they said they would. He told me to hand it out and give it to them and I did so; and he says to the officials of the bank, 11 want this put in here for my brother Peter,’ and they says all right, do you want it put in jointly ? ’• ‘ No,’ he says, I want it put in so that be will get it in ease there should anything happen to me.’ He says, I want my brother Peter to have this money,’ and they put it in the bank and gave the book to him and he handed the book to me and says, there is the book and there is your money.’ ”

It subsequently appeared, on his cross-examination, that the book was not handed to him, nor the remark, “ there is the book and there is your money,” made, until fifteen or twenty minutes after the deposit, and when they were standing in the front part of the bank on their way out to the street. No motion was made to strike this evidence from the record after it appeared that the occurrence did not take place until some fifteen or twenty minutes after the deposit, and hence under the stipulation of counsel that my decision might be reserved (see Rogers v. Rogers, 153 N. Y. 343-348), I will allow the evidence of the executor as to what occurred in the front of the bank to stand and deny the motion to strike out. A part of what was then ©aid and done having been brought out, or allowed to stand upon the record by the contestants, the other side is entitled to the whole conversation and transaction (Merritt v. Campbell, 79 N. Y. 625; Nay v. Curley, 113 id. 575), and I am strongly inclined to believe that the testimony as to what took place between these men, while they were still in the bank, was 'competent as part of the transaction and business which brought them there. Their purpose was twofold: one was to make this deposit; the other, as manifested by the form of the deposit and order signed by the testator, was the gift to Peter. It is undoubtedly true that the conversation and delivery of the bank-book in the front part of the bank was no part of the act of making the bank a depositary for that was then finished and completed. Testator had thereby gone as far as he then could to evince what his intention was in respect to a gift to Peter. The occurrence at the bank window was intended to be not only a transaction of deposit, but also a transaction of gift in tbe form and manner expressed by tbe said entry in tbe bank-book and tbe said written order. Tbe latter element in tbis twofold transaction was not complete, as- they understood it, until by tbe occurrence in front of tbe bank fifteen or tiventy minutes after they bad left the teller’s window. ■ If wbat then occurred bad taken place at tbe window, immediately upon tbe testator’s receiving tbe book, there could be no question as to tbe competency of tbe evidence, as one entire transaction. As I have said it was no part of tbe same transaction of depositing tbe money, but it was a part of that transaction so far as it related to a gift.

But with this evidence left standing and giving it full force, I can see no escape from the conclusion, as a matter of law, that no gift has been established. Tbe deposit was made by tbe testator in bis own name. “ In tbe event of death- payable to Peter Rose.” Tbe order which was signed by testator and filed -with tbe bank when tbe deposit was made reads:

“ LaNsiNGbuegh, N. Y., September 19'th, 1898.
“Bank of D. Powers & Sons: In tbe event of my death please pay deposits in pass-book No. 8062 in your bank to Peter Rose.
“ Philip B. Rose.”

Tbis order and form of deposit show dearly what tbe testator’s intention was at tbe time; it was only “ in event of bis death ” that tbe same was payable to Peter. Certainly nothing bad occurred prior to tbis deposit upon which a gift of the money could be predicated; Peter, in testifying to wbat took place at Schenectady, says: “ He banded me tbe money and I counted it over to see whether it was all right. After be was satisfied it was all right be gave me tbe money and I counted' it over, to see whether it was all right. I said to Mm it was all right, it was $2,000 and then he says: Well, put it in your pocket,’ he says, ‘you can carry it,’ so I put it in my pocket and the last roll was so- big I couldn’t get it in without showing pretty plain. He says, May be I can get that in my own.’ He took that in his pocket and we started for Troy.”

The money was handed to Peter merely to- “ carry it,” and one roll was immediately returned to testator and remained in his possession until they got to the bank in Lansingburgh. “ He asked me which bank to put it in and I told him the Powers Bank in Lansingburgh, and we went up there.” At the Powers Bank, testator, in the presence and with the acquiescence of Peter, made the deposit in his own name, thereby exercising full authority over the money -as owner, saying that he did not want it in their joint names but I want it put in so that he will get it in case there should anything happen to me,” hence, down to and at this time testator was the recognized owner, and the understanding of each was that Peter, only in the event of testator’s death, was to have it. This is emphasized by the declaration of testator that he did not want it in their joint names, in other words, he did not want it so deposited that Peter could draw it during his, testator’s lifetime. It is true that he said a.t that time, “ I want my brother Peter to have this money,” but this must be considered in connection with what he had just said, and with the form of the deposit, that is to say, he wanted him to have it in event of his death and not otherwise. If he had wanted to make an immediate gift he could have done so and allowed Peter to do as he pleased with it, deposit it or not, or he, Mmself, could have deposited it in Peter’s name; that was not his purpose, he did not want it so that Peter could draw it while he, himself, lived. Every circumstance shows that Ms purpose was to retain control over the deposit so long as he lived; tMs is evidenced not only by the form of the deposit, but by wbat testator said at the time thereof. The case of Sullivan v. Sullivan, 161 N. Y. 554, is quite similar to the one under consideration. In that case Catherine Sullivan deposited in the Chemung County Bank $2,000, “ payable one day after date to the order of herself, or in case of her death, to her niece, Catherine Sullivan.” Judg’e Wee-nek, after referring to the contention that a trust was created either in the bank or the depositor, says : The inherent weakness of both of these propositions lies in the fact that in the transactions between plaintiff’s intestate and the bank there was no immediate and fixed change of title to the fund. There was no intention, either expressed in terms or to be implied from the nature of the transaction, to immediately transfer the title of the fund to the defendant, or to the bank, except as the depositary and debtor of the depositor. This is the essential difference between the position of the defendant and the cestuis que trust in the oases cited in support of her contention.” As was said by Chief Judge Chubch in Martin v. Funk, 75 N. Y. 138, “ Enough must be done to pass the title, although when a trust is declared, whether in a third person or the donor, it is not essential that the property should be actually possessed by the cestuis que trust, nor is it essential that the latter should be informed of the trust. . . .

“ The defendant acquired no- rights in praesenti; she was to acquire them in futuro. This is the test which marks the essential difference between a valid gift inter vivos, or an effectual parol trust, and the mere expressed desire or intention to do that in the future which can only be done by will.” See Markey v. Markey, 38 N. Y. St. Repr. 173, as to such a deposit -being an attempt to make a testamentary disposition of property. In Gannon v. McGuire, 160 N. Y. 476, the per curiam, opinion says: The essential element of a gift inter vivos is the delivery by the donor of the subject of the gift with the intent -to at once vest title thereto in the donee. Mere words of gift are not enough, for the owner must part with possession and control before the gift can take effect. There must be an intent to make the gift in praesenti, because a gift to take effect in futuro is void as a promise without consideration.”

An absolute gift requires a renunciation by the donor and an acquisition by the donee of all interest in and title to the subject of the gift.” Curry v. Powers, 70 N. Y. 212.

There must be a delivery of possession with a view to pass a present right of property. Any gift of chattels which expressly reserves the use of the property to the donor for a certain period, or as commonly appears in the cases which the courts have had occasion to pass upon, so long as the donor shall live, is ineffectual.’ ” Young v. Young, 80 N. Y. 422, 436.

In the case of O’Connell v. Seymour, 53 N. Y. Supp. 748, Judge Eollett, in writing the opinion of the court, says: “ He who attempts to establish title to property through a gift inter vivos, as against the estate of a decedent, takes upon himself a heavy burden, which he must support by evidence of great probative force, which clearly establishes every element of a valid gift, — that the decedent intended to divest himself of the title in favor of the donee, and accompanied his intent by a delivery of the subject-matter of the gift.”

In this case there was, as hereinbefore stated, a delivery of the bank-book, but it was merely a delivery of a gift which was not to take effect, and the possession of which was not to pass until the donor’s death, unless there was then expressed by him an intention to make the gift immediate or in praesenti. There must accompany the act of delivery an intention on the part of the donor to thereby divest himself of the title and to then make the gift absolute, and that such was the intention must be clearly established by the donee.

If such was not his intention, the gift was not effectual for it was conditional only and fails to satisfy tbe legal requirements. It must be remembered that this deposit had been made but a few moments before, they were yet in the bank, testator had just declared that he did not want the deposit in their joint names, but that he wanted it in his name, and in the event of his death payable to' Peter, and it was thus made. He seems to have been quite particular about it and to have known definitely just what he wanted. If, .when he subsequently handed the book to Peter, with the remark “ there is your book and there is your money,” his intention had suddenly undergone a change, the inquiry naturally suggests itself, what caused it; certainly nothing had been said by either indicating any purpose to change this gift from one in futuro to one in praesenti. I am satisfied that the delivery of the pass-book was intended to be a delivery merely of a gift which was not to take effect until after the death of fhe testator and was not intended as a delivery of a gift to rfcake effect immediately. This view is further borne out by ■the fact that at the time of the said deposit testator’s property was only about $3,500, including the said $2,000, and there is no well-defined reason shown why he should prefer his brother Peter to the extent claimed by him and whereby his property would have been reduced to about $1,500. Testator had a son at that time living and the said grandchildren, and so far as appears to the contrary their relations were pleasant, in fact, he made the said grandchildren his residuary legatees. Also on the 12th day of May, 1891, the year before this alleged gift, he executed his will, yfhich has since been admitted to probate, whereby he appointed Peter his executor, which fact may have had a bearing upon his mind at the time he made the deposit which postponed the payment to Peter until after his (testator’s) death.

This case must be disposed' of on the theory of a gift inter vivos, no trust was created either in tbe bank or tbe testator for tbe benefit of Peter.

Tbe account of tbe executor should be surcharged with tbe amount of the said deposit and interest.

Let findings be prepared accordingly.

Decreed accordingly.

NOTE ON GIFTS INTER VIVOS.

GENERALLY.

There seems to be no distinction between gifts inter vivos and causa mortis as to tbe necessity for delivery to tbe donee, or placing in bis power by delivery of the means of possession. Harris v. Clark, 3 N. Y. 93.

Where donee was clerk of attorneys for donor, and bad charge of much of her business and enjoyed her confidence and esteem, and there was no fraud, deceit or undue influence, while transaction will be scrutinized with the extremest vigilance, tbe gift should be upheld under the circumstances. Nesbit v. Lockman, 34 N. Y. 167.

A gift, lacking some of the elements of a gift inter vivos, may still be upheld as a gift causa mortis. Williams v. Guile, 117 N. Y. 348.

An executory promise to pay a sum of money, made without consideration, and intended to operate as a gift after the death of the promisor, is invalid and cannot be enforced. Holmes v. Roper, 141 N. Y. 64.

A perfect gift is constituted by the existence of the intention to give, followed by the delivery of the thing given. Pickslay v. Starr, 149 N. Y. 432.

Essential element is delivery by donor of subject of gift with intent to ■ at once vest title in donee; but after gift made complete by delivery, held not necessary that donee should retain possession of the pi’operty, for it may be redelivered to donor as the agent of donee, for safe keeping. Gannon v. McGuire, 160 N. Y. 476.

Essential to the validity of a gift inter vivos that it shall be accompanied by either actual or constructive delivery, or shall be evidenced, in case of a chose in action, by a written assignment. Kernochan v. Russell, 36 Misc. 817.

ELEMENTS.

A gratuitous transfer of property from a wife to a husbandd, induced in part by representations on his part that she was liable for a debt, for which in fact she was not liable, and made in the belief that the effect of the transfer would be to delay the creditors or in some' way to save the property, will be set aside by a court of equity. Boyd v. De la Montagnie, 73 N. Y. 498.

To constitute a valid gift the transfer must he consummated, and not remain incomplete, or rest in mere intention; and this so whether the gift is by delivery only, or by the creation of a trust in the third person or in the donor; enough must be done to pass the title. Martin v. Funk, 75 N. Y. 134.

To make a valid gift in praesenti of an instrument securing the payment of money, reserving to the donor the accruing interest during life, without a written transfer or declaration of trust, there must he an absolute delivery of the security to the donee, vesting the entire legal title and possession in him on his undertaking to account to the donor for the interest. Young v. Young, 80 N. Y. 422.

It is essential to constitute a valid gift, that there should be a delivery such as vests in the donee control or dominion over the property, and absolutely divests the donor, and the delivery must be made with intent to vest the title in the donee. Jackson v. 23d St. Ry., 88 N. Y. 520.

To constitute a valid gift, the evidence must show a delivery of the property, with intent on the part of the donor to divest himself of title and the possession, and must be inconsistent with any other intention. Matter of Bolin, 136 N. Y. 177.

Held to be the creation of a trust and not a gift. Scallan v. Brooks, 54 App. Div. 248.

DELIVERY.

It is a sufficient delivery to constitute a valid gift ■Lo a married woman of household furniture in the possession and use of herself and family, where one who has just purchased under a chattel mortgage made by her husband, pointing out certain articles to the wife, says to her: “ I give you these and all the property I have purchased this day.” Allen v. Cowan, 23 N. Y. 502.

Where the holder of a promissory note voluntarily cancels Same, and surrenders it to the maker, this, although no consideration was paid, in the absence of fraud or mistake, operates in law as a release and discharge of the maker’s liability. Larkin v. Hardenbrook, 90 N. Y. 433.

INTENT.

A debt cannot be transformed into a gift by a mere parol declaration subsequent to its creation; but where money is delivered by a father to a son under circumstances rendering it uncertain as to whether it was intended as a loan or gift, a distinct declaration made afterwards, by the father to the son, may have the effect of determining which it was. Doty v. Willson, 47 N. Y. 580.

All that is necessary to constitute intention is the design or determination of the mind, and that mental condition may exist when an act is done, irrespective of the fact that, were something else then recalled, the mind might not have acted in the same manner. Pickslay v. Starr, 149 N. Y. 432.

Will not be sustained without proof that the alleged donor intended to part absolutely with the title to the subject of the alleged gift. Lehr v. Jones, 74 App. Div. 54.

SUBJECT OF GIFT.

Bonds.

Held no completed gift. Matter of Crawford, 113 N. Y. 560.

Belt.

A valid gift may be made of a debt due from the donee to the donor, and such gift may be consummated by the delivery to the former by the latter of any evidence of the debt existing; if one, then by the delivery of a receipt in full thereof. Gray v. Barton, 55 N. Y. 68.

Savings Ionic deposit.

Held no completed gift. Matter of Crawford, 113 N. Y. 560.

Evidence held insufficient to establish a gift. Beaver v. Beaver, 137 N. Y. 59.

An irrevocable trust held not to be established under facts disclosed. Cunningham v. Davenport, 147 N. Y. 43; Farleigh v. Cadman, 159 N. Y. 169.

Savings bank deposit, held to have created a trust for benefit of donee. Willis v. Smyth, 91 N. Y. 297.

Where woman opened savings bank account in joint names' of self and daughter, and testified that she had put money in bank for her daughter and had told her so, held insufficient to warrant finding that a gift was intended, where it appears that moneys belonged solely to mother, latter said nothing to bank officials at time deposit made, daughter did not leave signature at hank, mother retained control of funds and bank book, and she had testified in supplementary proceedings examination that money belonged to her. Schwind v. Ibert, 60 App. Div. 378.

Evidence considered and no valid gift found. Tyrell v. Emigrant, 77 App. Div. 131.

Evidence considered and held sufficient to establish a valid gift inter vivos. Hallenbeck v. Hallenbeck, 103 App. Div. 108.

REVOCATION.

When a gift has been consummated by delivery of its subject, by the voluntary act of the donor with the intention of making a gift, it cannot be revoked on the ground that it was made by mistake through the donor’s forgetfulness of a fact at the time of making the gift. Pickslay v. Starr, 149 N. Y. 432.

Where grantor procures to be inserted in his deed a provision requiring the grantees, as the consideration for the deed, to pay to the grantor’s daughter (a married woman of full age, not dependent upon him for support, and to whom he is not indebted) a certain sum which shall remain .a lien upon the premises until paid, and delivers to her a copy of that portion of the deed containing a description of the premises conveyed and the condition in her favor, the transaction constitutes an irrevocable executed gift of such sum, and the grantor has no power by a quit claim deed subsequently executed to the grantees, to exonerate them from their obligation to pay the stipulated sum to his daughter, and to require it to be paid to himself. Mace v. Thayer, 51 App. Div. 121.

ACTIONS.

A statement written on a note by the payee that it should be void at his death, held not to prevent a suit by his legal representative to recover the loan secured thereby. Dimon v. Keery, 54 App. Div. 318.

EVIDENCE.

Evidence considered and no gift found to have been consummated. Ferry v. Stephens, 66 N. Y. 321.

To set aside a gift of property because of unsoundness of mind of the donor, it is not essential to show that he was an idiot or imbecile at the time; it is sufficient to show that he was laboring under a delusion out of which he could not be reasoned, which led him to make the gift, and which so took possession of his mind that he could not act upon the subject sensibly. Riggs v. American, 95 N. Y. 503.

Evidence considered and held insufficient to support finding that gift was intended. Cowee v. Cornell, 75 N. Y. 92.

Where a party seeks to recover from executors the value of an article of personal property found among the effects of their testatrix, and the-only title asserted thereto is by way of gift from her, the facts which establish the validity of the gift and rebut the inference to be drawn from continued possession of the article by the decedent, must be proved by evidence so cogent as to leave no doubt in the mind of an unbiased person that the demand is a proper one — otherwise the legal presumption against the validity of the gift must prevail. Adler v. Davis, 31 App. Div. 120.

Evidence considered, and no valid gift found. Bray v. O’Rourke, 89 App. Div. 400.

Proof by tbe third wife of a donor that he, a few weeks before his death, gaye her three bank books and three cheeks signed in blank, instructed her in writing to go to the banks, fill out the cheeks for the balances due and transfer them to the credit of their infant daughter, when accompanied by the evidence of a holographic instrument executed within a few months of the transaction and which “would have been good as a will if signed at its physical end, making the same disposition of the bank deposits, shows, as against children of a former marriage, a sufficient delivery to or for the donee and a valid gift to her of the depposits. Matter of Reichert, 38 Misc. 228.

Held sufficient to establish a gift. Gilkinson v. Third Ave. R. R., 47 N. Y. 472; Barefield v. Rosell, 177 N. Y. 387; Barker v. Harbeck, 2 N. Y. Supp. 425; Matter of Reichert, 38 Misc. 228.

Held insufficient to establish a gift. Trow v. Shannon, 78 N. Y. 446; Beaver v. Beaver, 117 N. Y. 421; Matter of O’Connell, 33 App. Div. 433; In re Crawford, 113 N. Y. 560.