Title: Zink v. Stafford
Citation: N/A
Docket Number: 980283
State: Virginia
Issuer: Virginia Supreme Court
Date: January 8, 1999

Present:  All the Justices 
 
JUNE S. ZINK, INDIVIDUALLY AND 
AS ADMINISTRATOR OF THE  
ESTATE OF THOMAS J. STAFFORD,ET AL. 
 
 
 
 
OPINION BY JUSTICE A. CHRISTIAN COMPTON 
v.  Record No. 980283 
January 8, 1999 
 
THOMAS L. STAFFORD 
 
 
FROM THE CIRCUIT COURT OF CHESTERFIELD COUNTY 
John F. Daffron, Jr., Judge 
 
 
In this chancery suit, we consider whether four promissory 
notes are estate assets or whether the notes passed to the 
decedent's daughter, individually, by right of survivorship. 
 
Thomas J. Stafford, a widower, died intestate in 1984, 
survived by his only children, a son, appellee Thomas L. 
Stafford, and a daughter, appellant June S. Zink.  In 1985, the 
daughter qualified as administrator of the decedent's estate. 
 
In 1988, the son filed a bill of complaint, later amended, 
against the daughter individually and in her representative 
capacity, and Continental Insurance Company, surety on the 
administrator's bond.  The son alleged, inter alia, that four 
promissory notes were estate assets rather than assets that 
passed to the daughter individually by right of survivorship, as 
she claimed. 
 
The cause was referred to a commissioner in chancery, who 
reported to the court in 1992.  In a 1994 order, after argument 
of counsel, the chancellor remanded the cause to the 
commissioner in chancery, who was directed to report, inter 
alia, "Whether the . . . promissory notes referred to in 
paragraph 5 of the Amended Bill of Complaint are assets of the 
Estate of Thomas J. Stafford or whether they passed to his 
daughter, June S. Zink, by right of survivorship or otherwise." 
 
The commissioner held two additional hearings and reported 
to the court in 1996 that the four promissory notes were not 
estate assets but "became the property of" the daughter by right 
of survivorship.  The son excepted to the commissioner's finding 
on this issue. 
 
After further argument of counsel, the chancellor, in a 
written opinion, sustained the son's exception, ruling that the 
four promissory notes "are assets of the estate."  This ruling 
was incorporated in a November 1997 judgment order, from which 
we awarded the daughter this appeal. 
 
At the time of his death, the decedent resided in 
Chesterfield County, where he had been engaged in farming, and 
in the development of a residential subdivision upon a parcel of 
land that he owned.  Prior to his death, he built four houses in 
the subdivision, each on an individual subdivided lot.  He sold 
each of the lots with improvements and in each instance took 
back a purchase money note secured by a deed of trust from the 
purchaser for part of the purchase price. 
 
2
 
These notes have been referred to throughout this prolonged 
litigation as the "Higgerson note," the "Wood note," the 
"Brockwell note," and the "Ross note," so called because the 
names referred to the makers of the notes and the purchasers of 
the real estate.  The Higgerson note originally was payable to 
the decedent's order and subsequently endorsed by him on the 
note, "Pay to the order of Thomas J. Stafford or June S. Zink, 
or the survivor."  The payee on the other three notes in each 
instance was "Thomas J. Stafford and June S. Zink, or the 
survivor." 
 
Proceeds from the notes were deposited into a "collection 
account" at a local bank.  The account was maintained in the 
names of "Thomas J. Stafford and June S. Zink as joint tenants 
with right of survivorship."  During the several years before 
his death, the decedent's health failed, he "couldn't write 
checks on his own," and he was legally blind.  Funds from the 
account were used for the decedent's maintenance or otherwise 
spent as he directed. 
 
On appeal, the daughter says, "The sole question in the 
case is whether the Court below was correct in its ruling that 
the four promissory notes were assets of the decedent's estate, 
or whether they passed by right of survivorship to the surviving 
joint tenant." 
 
3
 
The daughter focuses her argument on the provisions of Code 
§§ 55-20 and -21, and upon this Court's decision in Pitts v. 
United States, 242 Va. 254, 408 S.E.2d 901 (1991).  Section 
§ 55-21 creates an exception to § 55-20 (which abolished the 
common law right of survivorship between joint tenants) "when it 
manifestly appears from the tenor of the instrument that it was 
intended the part of the one dying should then belong to the 
others."  See Buck v. Jordan, 256 Va. 535, 542, ___ S.E.2d ___, 
___ (1998).  In Pitts, interpreting those statutes, we found 
"that they were intended to apply to joint tenancies and to 
tenancies by the entireties created by an 'instrument' of 
conveyance or devise."  Pitts, 242 Va. at 260, 408 S.E.2d at 
904.  We said that the promissory notes in issue there were "not 
such instruments."  Id.
 
The daughter argues that the trial court misread Pitts when 
it held that Pitts required a holding that the notes in question 
here were not instruments of conveyance or devise and, thus, did 
not qualify for the § 55-21 exception.  She contends that the 
Wood, Brockwell and Ross notes, "in their original form, were 
the instruments that created the joint form of ownership.  They 
were therefore instruments of conveyance."  Continuing, the 
daughter argues, "The Higgerson note could not, in its original 
form, be regarded as an instrument of conveyance."  She says, 
"That note, like the notes in Pitts, was a memorial of a chose 
 
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in action, meaning the right of Thomas J. Stafford to the fund 
represented by the note.  However, Mr. Stafford's endorsement of 
the Higgerson note so as to make it payable 'to the order of 
Thomas J. Stafford or June S. Zink, or the survivor' made the 
note, as indorsed, an instrument of conveyance" under § 55-21. 
 
In response, the son observes the daughter's appeal is 
based solely on the argument the trial court erred in ruling 
that a survivorship interest cannot be created by a promissory 
note because it is not an instrument of conveyance or devise as 
required by § 55-21.  He argues that the daughter, however, 
fails to consider another ruling by the trial court that renders 
her argument moot.  He says she incorrectly assumes a critical 
fact, which is that she held a joint tenancy in the notes with 
the decedent before his death.  To the contrary, the son points 
out, the chancellor found that the daughter failed to prove the 
father made a valid gift of the note proceeds to her during his 
lifetime.  Thus, the son argues, the broader question whether 
these notes create a survivorship interest is immaterial, 
because the notes did not vest any interest in the daughter 
during the decedent's lifetime.  Before a survivorship interest 
in the daughter could have been created, the son contends, the 
father must have created a joint tenancy between himself and the 
daughter during his lifetime by conveying or giving her an 
interest in the notes that vested at the time of the gift.  
 
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Without such a conveyance or gift, the son argues, a joint 
tenancy did not exist from which to create survivorship.  We 
agree with the son. 
 
At common law, survivorship was an incident of joint 
tenancy.  Allen v. Parkey, 154 Va. 739, 744, 149 S.E. 615, 617 
(1929).  A survivorship interest can only be created between 
joint tenants.  See Camp v. Camp, 220 Va. 595, 599, 260 S.E.2d 
243, 246 (1979). 
 
In the present case, because the daughter did not purchase 
an interest in any of the notes, the only manner in which she 
could have become a joint tenant with her father was for him to 
have made a gift to her of an interest in the notes before his 
death.  To determine whether the decedent made a valid gift 
inter vivos, the trier of fact must look beyond the declarations 
on the instrument in question and consider the surrounding facts 
and circumstances. 
 
In Swan v. Swan, 136 Va. 496, 117 S.E. 858 (1923), a donor 
had retitled several shares of stock to include his wife's name.  
This Court said that the manner in which the shares of stock 
were retitled was technically sufficient to transfer title.  But 
the Court further explained that "it is quite possible and often 
happens, for reasons of convenience or otherwise, that stock 
held in the name of one person really belongs to another.  In 
such a case the certificate, though prima facie evidence of 
 
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ownership in the person to whom it has been issued, possesses no 
such magic or sacredness as to prevent an inquiry into the 
facts.  Sometimes the transferee is merely a nominal holder or 
'dummy,' and in that event, although the transfer may be 
perfectly regular and complete on its fac[e], the true ownership 
remains in the transferor, and that fact may be shown."  Id. at 
519, 117 S.E. at 865. 
 
The burden to prove a gift was on the daughter.  When a 
donee claims title to personal property by virtue of a gift, the 
burden of proof rests upon the donee to show every fact and 
circumstance necessary to constitute a valid gift by clear and 
convincing evidence.  Rust v. Phillips, 208 Va. 573, 578, 159 
S.E.2d 628, 631 (1968). 
 
One of the elements necessary to constitute a gift inter 
vivos is that title to the property must vest in the donee at 
the time of the gift.  Taylor v. Smith, 199 Va. 871, 874, 102 
S.E.2d 160, 162-63 (1958).  The gift "must be absolute, 
irrevocable and without any reference to its taking effect at 
some future period."  Quesenberry v. Funk, 203 Va. 619, 623, 125 
S.E.2d 869, 873 (1962).  If a purported gift is not to take 
effect until the donor's death, then there "is an abortive 
testamentary act and not a gift."  Knight v. Mears, 156 Va. 676, 
681, 159 S.E. 119, 120 (1931). 
 
7
 
The evidence in the present case clearly shows that the 
decedent during his lifetime never divested himself of dominion 
and control over any portion of the promissory notes.  Although 
the note proceeds were deposited into the joint "collection 
account" from which both the father and daughter could withdraw 
funds, she never deposited any of her own funds into the account 
during his lifetime.  She admitted that during his lifetime she 
was on the account solely as a convenience to her father, and 
agreed in testimony that he was not making a gift of those 
proceeds to her during his lifetime.  For example, when asked, 
"And you didn't consider one-half of those accounts yours while 
your father was alive?", she responded, "No, sir, I did not."  
Moreover, the daughter admitted she could not spend during his 
lifetime any monies in the account without his prior approval.  
Also, the evidence showed the interest earned on the account was 
reported as income on the father's tax returns and none of it 
was reported on her income tax returns. 
 
Thus, the survivorship language on each note was an 
abortive testamentary act and not a gift.  See Quesenberry, 
supra, 203 Va. at 623-24, 125 S.E.2d at 873 (gift in praesenti 
of interest in joint bank account naming father and daughter not 
shown when daughter considered the money belonged to father 
during his lifetime); Wrenn v. Daniels, 200 Va. 419, 430, 106 
S.E.2d 126, 133 (1958) (parol evidence showed decedent had not 
 
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made valid gift inter vivos of interest in shares of stock and 
bank account titled jointly in name of decedent and his son). 
 
In sum, because there was no valid gift to the daughter of 
any portion of the notes, she did not hold title with her father 
as a joint tenant.  Thus, without the prerequisite of a joint 
tenancy, survivorship could not be created.*
 
Consequently, we hold that the trial court correctly 
determined that the promissory notes and their proceeds were 
estate assets and did not pass to the daughter individually.  
Hence, the judgment below will be 
Affirmed. 
                     
*In applying the law of gifts inter vivos to determine whether 
the daughter had an ownership interest in the notes as a joint 
tenant, we observe the present case is distinguishable from 
cases like Buck, supra, which applied contract principles when 
construing language in signature cards or account agreements to 
determine whether a surviving joint tenant acquired title to all 
the proceeds in a bank account.  In Buck, the parties did not 
contest that the surviving joint tenant had an ownership 
interest in the investment account. 
 
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