Court Opinion

ID: 9655733
Source: CourtListenerOpinion
Date Created: 2023-08-23 19:20:20.28313+00
Date Added: 2024-06-11T18:13:21.434514
License: Public Domain

Carter, J.,
dissenting.
The deceased died on October 24, 1950, at the age of 80 years, leaving an estate valued in excess of $465,000. She was unmarried and, according to the evidence, eccentric to the extent that she did not trust bankers and lawyers. This evidently accounts for her failure to patronize banking institutions and to make a will. The property here involved can readily be divided into three groupings: (1) 205 shares of stock in the Crowell Elevator Company, (2) a cash balance of $11,163.12 on hand in the Omaha National Bank at the time of the death of Rena S. Milligan, and (3) 24 first mortgage gold bonds issued by the Pan-American Railroad Company. I shall deal only with items 1 and 2, as I agree with the disposition made of item 3 by the majority opinion.
The deceased wrote a letter to Crowell requesting that the elevator stock and her money in the hands of the Crowell Elevator Company be transferred to “Rena S. Milligan and Viola M. Milligan as Joint Owners with Rights of Survivorship.” This letter was approved by Viola M. Milligan. A new stock certificate was issued in the form requested and mailed to deceased individually. She returned the stock certificate to Crowell, who in receipting for it by letter said in part: “ (I) ac*146knowledged the instructions she gave me to hold it in our vault for further instructions.” Crowell still held the stock on the death of the deceased, subject to her instructions. Dividends were paid on this stock to Rena S. Milligan in 1948,1949, and 1950 by checks paid to her individually. Voting proxies were mailed to Rena S. Milligan during this period and voted by her. Crowell testified that he dealt solely with Rena S. Milligan and that she intended to retain control during her lifetime and to handle and treat it as her own until her death. He said that only Rena S. Milligan told him what to do with the deposits, the stock, and the bonds, and that no other person attempted to do so. According to the evidence of Crowell, the stock certificate was never delivered to Viola M. Milligan, nor was he ever directed to do so by Rena S. Milligan during her lifetime. Viola M. Milligan testified that she never saw the stock certificate nor had it in her possession and that it was her understanding that if anything happened to Rena S. Milligan it would go to her; that she would get it after Rena S. Milligan passed away.
With respect to the money in the hands of Crowell, the record shows that after the account with the Crowell Elevator Company had been changed to “Rena S. Milligan and/or Viola May Milligan as Joint Tenants and not as tenants in common, with rights of survivorship,” Rena S. Milligan directed them to be transferred to an account in the Omaha National Bank identified as “Herman F. Crowell, Agent.” The directions provided that these funds could be drawn out only on the signature of Rena S. Milligan while the agreement contained in the letter of September 16, 1949, was in force. That letter, signed by Crowell and Rena S. Milligan, said in part: “As I understand it, you wish to deposit certain funds with me from time to time, which I will carry for you in a special bank account. Also, from time to time you will instruct me to pay out funds from this account on your order.” The bank account was thereafter estab*147lished in the name of “Herman F. Crowell, Agent.” There was $3,719.36 in the account when the “Herman F. Crowell, Agent” bank account was established. There was $7,489.53 in the account when the alleged joint account was set up on the books of the Crowell Elevator Company. There was $11,163.12 in the account when Rena S. Milligan died. All funds deposited were those of Rena S. Milligan, and Crowell followed Rena S. Milligan’s instructions .regarding the account. Viola M. Milligan never drew on the account nor requested permission to do so. She said she never knew of the existence of this bank account until Crowell told her about it after the death of Rena S. Milligan.
The controlling rule is set out in First Trust Co. v. Hammond, 140 Neb. 330, 299 N. W. 496, in the following language: “To make a valid and effective gift inter vivos, there must be an intention to transfer title to the property, and a delivery by the donor and acceptance by the donee, and the transfer must be so complete that if the donor again resumes control over it without the consent of the donee he becomes liable as a trespasser.”
There is, of course, evidence of a donative intent to become operative at her death. This constitutes it a testamentary disposition of the property which can be lawfully accomplished only by compliance with the statute of wills. But in each of the three groupings of property presently before the court, Rena S. Milligan never lost dominion over or control of the property. She never intended to lose control of it during her lifetime, and the evidence of Crowell and Viola M. Milligan affirmatively so shows. There was never an attempt by the donee to take control of the property because the deceased very carefully saw to it that it was to be hers and under her control until her death. As to the stock in the Crowell Elevator Company, she caused the certificate to be changed, but she alone retained its custody and placed it in Crowell’s care subject to her instructions. She collected the dividends *148personally, she voted the stock in corporate elections,, she alone dealt with Crowell with reference to it, and Crowell testified that she at all times treated it as her own. The purported donee, Viola M. Milligan, said she-claimed no interest in the stock or dividends during the lifetime of the deceased and that she considered that it belonged to Rena S. Milligan until her death. Clearly, there was no delivery of a present interest in the property, constructive or otherwise. With reference to the cash account, the record shows that Rena S. Milligan at all times during her lifetime retained control of it. Crowell, admittedly her agent, handled the account in accordance with written instructions which definitely provided that the funds could be drawn out only by Rena S. Milligan. All funds deposited were hers and all withdrawals were by her. The purported donee never knew about the account and never drew upon it, nor requested or insisted upon any right to do so. Control never passed and, necessarily, a gift inter vivoswas not made.
We have said: “One of the essential elements of a gift is the intention to make it. A clear and unmistakable intention on the part of the donor to make a gift of his property is an essential element of the gift, and this contention must be inconsistent with any other theory. * * * While the theory of a gift has been presented and counsel has assumed that the transfer of the-legal title might be sufficient to effectuate a gift, still the person asserting it must prove all the essential elements by clear, direct, positive, express and unambiguous-evidence.” Hild v. Hild, 135 Neb. 896, 284 N. W. 730. I submit that the evidence in this case does not come close to meeting these requirements.
I point out also that a transfer of stock on a corporation’s books does not of itself constitute a delivery of' the stock. § 21-201, R. S. 1943. See, also, Figuers v. Sherrell, 181 Tenn. 87, 178 S. W. 2d 629, 152 A. L. R. 420, wherein it is stated:
*149“It may be conceded that Sherrell had the intention of giving these shares of stock to his nephew at some future time when he procured the certificate to be issued in the name of the latter. All the subsequent conduct of Sherrell however negatived the idea that he had any intention of giving to his nephew a present interest in the stock and a transfer of the present interest is necessary to the completion of a gift inter vivos. Chandler v. Roddy, supra.
“We think that Sherrell never parted with his dominion and control over these certificates of stock issued in the name of the complainant but delivered to Sherrell and retained all the while by him.”
It is asserted however that there was a constructive delivery of the property. I do not question that under certain circumstances there can be a constructive delivery of property in order to make a gift inter vivos complete. The most common instances of constructive delivery are where the alleged donor retains an interest in the property. The donor in the present case, assuming the correctness of the positions of the alleged donee, retained an interest in the Crowell Elevator stock and the bank account. In order to have a constructive delivery the evidence must show that all the elements of a gift inter vivos were present except a manual delivery, and that a manual delivery.was not made simply because it involved only a partial interest. A constructive delivery of a partial interest in property requires proof that the transfer of a present interest was intended. But where, as here, all the evidence shows an intent to transfer an interest only on the death of the donor, there can be no delivery, either actual or constructive, sufficient to complete a gift inter vivos. A constructive delivery arises when every essential element of a gift inter vivos has been established and actual delivery is not made because of an impossibility to do so. I' submit that all the evidence shows the intent of Rena S. Milligan to make a gift effective at her death. The subse*150quent conduct of the donor and donee sustains this conclusion. In addition thereto the donee of the elevator stock and the bank account expressly testified that this was the intention of the parties and that any right she had in them was to arise on the death of Rena S. Milligan. No gift inter vivos can be established by such evidence. The majority opinion states that the statements of Crowell to the effect that the donor intended to control the property in her lifetime and to treat it as her own until her death “were obviously his conclusions.”' Crowell was a witness called by the alleged donee. No-objection was made to this evidence. It is clear, also, that his conclusions, if such they be, were sustained by the evidence as a whole and the admitted conduct of the-parties over the years after the gift inter vivos was alleged to have been made. The majority opinion sustains the gift, in part at least, on statements made by the donee. I submit that if a gift inter vivos can be so-established, a method is provided for the defrauding of estates that has been heretofore forcibly barred by our decisions. It is very obvious that these statements of the donee were her conclusions for the reason that the-record shows she knew nothing of the details of the purported gift until after the death of the alleged donor. It is evident also that the alleged admissions of the-donor were as consistent with a testamentary disposition of her property as with a gift inter vivos.
My position can be summarized in the language of the-court in Mercantile Bank v. Haley (Mo. App.), 179 S. W. 2d 916, wherein it is said: “It is no doubt true that. Wamsley wished to avoid an administration of his estate and sincerely thought that he had arranged his affairs in such a way as to accomplish that result. Likewise, we appreciate the fact that such a desire would have been entirely consistent with an intent to create a joint tenancy in the account. The trouble is, however, that in his misunderstanding of the situation, he honed to avoid an administration while at the same time re*151serving to himself the power to make a testamentary disposition of his estate. The latter, of course, was entirely inconsistent with an intent to create a joint tenancy in the account; and we must therefore hold that for the want of a completed gift to Mackey of a present joint interest in the account, no joint tenancy was created, and the balance remaining on Wamsley’s death, instead of belonging to Mackey as the surviving codepositor, became a part of Wamsley’s estate, * * See, also, Young v. McCoy, 152 Neb. 138, 40 N. W. 2d 540.
The record clearly shows, in my judgment, that Rena S. Milligan never intended to convey a present interest in items 1 and 2 to the alleged donee. While the letter of October 25, 1947, might indicate it, the record clearly shows her intent was otherwise. Surely a letter has no greater dignity in court as evidence than a formally executed and delivered deed, or bill of sale, which we have repeatedly held to be subject to investigation upon competent evidence as to the intent of the grantor in making delivery. I do not doubt that Rena S. Milligan had a donative intent, — an intent to give at the time of her death, — but not an intent to give a present interest in the property to the donee during her lifetime. The fact that she did not deliver the railroad bonds to the alleged donee when all parties agree that she retained no interest therein is some evidence of her overall intent to make a testamentary disposition of her property in violation of the will statute.
Having these views I respectfully dissent from the contrary holdings of the majority opinion and I would affirm the judgment of the trial court.