Court Opinion

ID: 9737062
Source: CourtListenerOpinion
Date Created: 2023-08-26 19:14:32.374697+00
Date Added: 2024-06-11T09:42:14.083444
License: Public Domain

BECKER, Justice.
I dissent.
The majority opinion omits some facts of importance: Prior to August 7, 1964 decedent had a certificate of deposit for $8000 on which he had written that $2000 was to go to Marlyn Sheimo and $6000 to Richard Sheimo. The record is not clear to whom this earlier certificate was made payable. We were told in oral argument this first certificate named both defendants as payees (an unsatisfactory way to come by needed information).
On August 7, 1964 the banker talked to decedent about this certificate. The record on the point is short. We shall quote most of it: “I told the decedent that if anybody should die, that the certificate of deposit would not be divided into two thousand and six thousand because the bank could not go by this writing on the certificate of deposit. That the decedent would have to either separate the certificate of deposit if he wanted to divide it out that way.
“The decedent said to make out two certificates of deposit, one for six thousand dollars to Richard Sheimo and one for two thousand dollars to Marlyn.
“I then prepared these two certificates of deposit and told him we would have to have either Richard or Marlyn’s endorsement on the old certificate of deposit before we could make out this new one. Richard came and endorsed the old $8,000.00 certificate of deposit. I had the certificate of deposit endorsed so we could make out these two new ones. * * *
“Q. And did you help him put — ? A. I helped him put them in the safety deposit box.
“Q. Was there any further discussion between you and the decedent at this time concerning this transaction? A. Just that he was going to deliver them some time but he didn’t know when.”
The face of the certificate has the following written on it: “payable to said depositor, or, if more than one, to either or any of said depositors or the survivor or survivors, upon presentation and surrender of this certificate on a maturity date.” (Emphasis supplied.)
With these facts added there can be no doubt the elements of a gift were not shown. At least one of the claimed donees, Richard, was present when the new certificates were made out but no delivery was made. Delivery was neither impractical nor inconvenient. Instead, decedent returned the certificates to his lock box with the statement that “he was going to deliver them some time but he didn’t know when.” See Gray v. Watters, 243 Iowa 430, 51 N.W.2d 885.
Decedent’s treatment of the prior $8000 certificate establishes the pattern of his action and is relied upon by the trial court. We are told the prior certificate also was not in decedent’s name but in the names of Richard and Marlyn. But decedent retained control of the certificate and subsequently exercised dominion over it by having it substantially changed. He had it reissued in the form of the two present certificates, changing the presumptive equal ownership (if we are to rely on the face of the certificate alone) to unequal designation— $6000 for Richard and $2000 for Marlyn. *687The trial court felt these actions negatived any intent to part with dominion and control over the first certificate and thus negatived a gift of the second certificates. The trial court was right.
II. The majority applies the theory of contract to establish ownership to assets held individually in the name of a person other than the person who furnished the consideration for the asset. This theory is now the law of Iowa where the assets are held in joint tenancy. It has never been applied to the situation we have here. There are vital differences in fact and in theory.
Before extending the contract theory of ownership to areas where the purchaser is not a joint owner we should look at the development of that doctrine in the joint tenancy field.
Up to and including Sinift v. Sinift, 229 Iowa 56, 293 N.W. 841, the rule as to join tenancy set out in Taylor v. Grimes, 223 Iowa 821, 826, 273 N.W. 898, was the law of Iowa.
Taylor v. Grimes states: “The mere opening of a joint account each having an equal right to draw does not in and of itself establish a gift, 28 C.J. 664 ; 48 A.L.R. 191. There must be an intention to make a gift; a present intent to part with the title and to transfer all right to and dominion over the subject of the gift to the donee without power of revocation followed by delivery of the subject matter of the gift.”
Following the Sinift case establishment of survivor’s ownership of personal property on the theory of a contractual right was again urged on this court. In re Wink-ler Estate, 232 Iowa 930, 5 N.W.2d 153, established joint tenancy on the basis of the evidence which showed mutual possession of the bank book and relied heavily on the contract theory. “Here we have the instrument creating the joint tenancy declaring in express terms the rights of the parties. The card, which we regard as a contract, shows all the essential features of joint tenancy. It so declares and so designates the joint deposit.”
The court did not specifically find there was a gift under the facts of the Winkler case. A similar result was reached in O’Brien v. Biegger, 233 Iowa 1179, 11 N.W.2d 412, where the court first reached its conclusion on the contract theory but also found a gift inter vivos had been completed. The intention of the parties was held to be controlling.
In re Murdoch’s Estate, 238 Iowa 898, 29 N.W.2d 177, McManis v. Keokuk Savings Bank & Trust Co., 239 Iowa 1105, 33 N.W.2d 410; Hill v. Havens, 242 Iowa 920, 48 N.W.2d 870; In re Miller’s Estate, 248 Iowa 19, 79 N.W.2d 315; Burns v. Nemo, 252 Iowa 306, 105 N.W.2d 217; and In re Stamet’s Estate, 260 Iowa 93, 148 N.W.2d 468, all deal with situations where, there is a clear contractual base.
In re Murray’s Estate, 236 Iowa 807, 20 N.W.2d 49, establishes the same principle for creation of joint tenancy in United States Government Bonds. In this field the federal regulations are explicit and controlling as part of the contract of purchase of the bond.
Many of the above cited cases quote signature cards expressly providing that the parties agree to the form of ownership. Of course we have no such signature card or other evidence of agreement here. Each of the above cases is finally decided on the presence or absence of a contract between the parties themselves or as between one or more of the parties and the bank. In Stamets, supra, at page 471 of 148 N.W.2d we said: “It is plain a deposit in an ordinary bank creates a valid contract between the bank and depositor under which the former agrees to repay the funds subject to the rules and regulations of the bank.” (Emphasis supplied.)
The importance of the phrase “subject to the rules and regulations of the bank.” becomes apparent when a situation like that considered in Keokuk Savings Bank & *688Trust Co. v. Desvaux, 259 Iowa 387, 143 N.W.2d 296, develops. In that case decedent caused a joint tenancy account to be opened. Subsequently, all of the funds in the account were withdrawn at decedent’s written order but no pass book was presented. We held that failure to present the pass book was fatal to the transfer. True, either joint owner could withdraw all of the funds if the pass book were presented. But without the pass book neither could make withdrawals. The parties have a right to rely on the bank rules.
Here we have no bank rules of record. We do have the recitation on the face of the certificate that it is payable “upon presentation and surrender of this certificate on maturity date.” Keokuk Savings Bank & Trust Co. v. Desvaux, supra, settles the proposition that people have a right to rely on the rules of the bank. People also have a right to rely upon what is written on the face of the certificate. This being the case the decedent could rely on the fact that he still retained an important measure of control. Retention of this control is fatal. Without the well established principles of joint tenancy any other result would be contrary to the law relating to wills. Code, 1966, section 633.279.
The foregoing discussion would seem to agree with Restatement of the Law, Contract, Vol. I, § 158, p. 193 which states in part:
“(1) The right acquired by the assignee under a gratuitous assignment is terminated by the assignor’s death, by a subsequent assignment by the assignor, or by notification from the assignor received by the assignee or by the obligor, unless, * * *
“(b) the assigned right is evidenced by a tangible token or writing, the surrender of which is required by the obligor’s contract for its enforcement, and this token or writing is delivered to the assignee; or” (emphasis supplied).
III. Another cogent reason for adhering to our former rules relating to transfer of ownership appears when the fields of inheritance tax, estate tax and gift tax laws are considered. Section 450.3(3) Code, 1966 includes, for inheritance tax purposes, property “intended to take effect in possession or enjoyment after the deáth of the grantor or donor.” How is this type situation to be discovered? We say a donor may place an asset in the donee’s name but continue in control of the disposition by control of the physical evidence of the asset. He can continue such control to time of death but we treat the gift as complete in all respects at the time the ficional contract is made. The state will no doubt develop a theory to handle such situations when they come to its attention. Many such situations will not come to the state’s attention for there will be nothing to alert the department of revenue. The tax revenue will be lost either through deliberate evasion or innocent failure to report. The result will be the same.
LeGRAND, J., joins in this dissent.