Court Opinion

ID: 6141131
Source: CourtListenerOpinion
Date Created: 2022-02-05 14:38:57.206318+00
Date Added: 2024-06-11T08:54:39.013935
License: Public Domain

Van Brunt, J.
[After stating the facts as above.]— The defense of the Statute of Limitations cannot prevail in the case at bar, because, if the acts of Dr. Bailey in making the deposit as he did made him the trustee of the plaintiff, he did no act inconsistent with that relation which would have set the Statute of Limitations in operation. The mere fact of his withdrawing money with or without the knowledge of the plaintiff was not an act inconsistent with his position as trustee. He had the right to change the investment if he saw fit or deemed it for the advantage of his cestui que trust, and therefore the mere taking of the money from the bank was not such an open and notorious assertion of ownership as would have made him liable to an action, and until a right of action accrues the statute cannot begin to run.
In the case of Mubbell v. Medbury (53 N. Y. 98), the court held that when the trustee begins openly and notoriously to use trust property as his own, asserting an individual right thereto, the liability accrues and the statute begins to run. It clearly cannot begin to run before, because, as long as the acts of the trustee are hot inconsistent with his character as trustee, no presumption can arise that he intended to violate bis trust, so that the cestui que trust would be called upon to act.
The case of Martin v. Funk (75 N. Y. 134) seems to hold that the making" of the deposit in the bank'in the way in which Dr. Bailey did in the case at bar, would constitute a valid gift, unless, perhaps, it might be shown not to have been intended as such by facts and circumstances surrounding the transaction.
Great stress has been laid upon the subsequent acts of Dr. Bailey as showing that he did not intend this deposit as a gift, but I fail to see how any subsequent acts or sayings of Dr. Bailejr can be resorted to for this purpose. If it *63were a gift, he could not unmake it or revoke it by any subsequent act or deed. Certainly, years after he had made what in law was a valid gift, the deceased could not change its character by any declarations he might make, nor could he do so by any acts which he might do ; and therefore the question must be determined by what occurred at the time.
It is claimed that these deposits were made in trust in order to secure larger rates of interest at the bank, but this intent is inconsistent with the testimony that he informed the mother of the plaintiff that he had made this provision. It is true that he denied the mother’s request to be paid the money then, but this denial is entirely consistent with the creation of a valid trust to be closed with the minority of the beneficiary.
The various cases decided upon this point might be reviewed for the purpose of showing the general tendency of decisions in this state, but this would be only going over ground so ably covered by the opinion of our late learned Chief Justice Church in the case of Martin v. Funk.
I am of the opinion, from the facts disclosed at the trial of this cause, that the deceased intended to and did make a valid gift of this money to the plaintiff by making the deposit in the manner in which he did.
As to the rate of interest allowed, it seems to have been entirely in accordance with the rule that where a trustee mingles trust funds with his own, he shall be charged with legal interest.
The exceptions of the defendant should be overruled, and judgment upon the verdict entered for the plaintiff, with costs.
Charles P. Daly, Ch. J., and J. F. Daly, J., concurred.
Exceptions overruled and judgment directed for plaintiff, with costs.*

 The judgment entered upon this decision was affirmed by the Court of Appeals February 26th, 3884 (see 95 N. Y. 206).