Creekmore's Estate, In re

• Decision Date: 24 May 1956
• Citation: 135 N.E.2d 193,1 N.Y.2d 284,152 N.Y.S.2d 449
• Parties: , 135 N.E.2d 193 In re CREEKMORE'S ESTATE. Matter of the Accounting of May E. ROWLAND, as Executrix of Elizabeth M. Creekmore, Deceased, Respondent, Nana A. Ogg, Appellant.
• Court: New York Court of Appeals Court of Appeals

Page 449

152 N.Y.S.2d 449

1 N.Y.2d 284, 135 N.E.2d 193

In re CREEKMORE'S ESTATE Matter of the Accounting of May E. ROWLAND, as Executrix of Elizabeth M. Creekmore, Deceased, Respondent, Nana A. Ogg, Appellant.

Court of Appeals of New York.

May 24, 1956.

Jacob W. Friedman and Milton A. Goldiner, New York City, for appellant.

Charles H. Birdsall and Paxton Blair, New York City, for respondent.

VAN VOORHIS, Judge.

This is a contest between the two daughters of Elizabeth M. Creekmore over the proceeds of two savings bank accounts aggregating about $15,000, which belonged to Mrs. Creekmore, and constituted about three fifths of her assets at the time of her decease. Letters testamentary have been issued to Mrs. Rowland under Mrs. Creekmore's will executed October 31, 1949, whereby these two bank accounts were given as follows: 'I give and bequeath unto my daughters, Nana Alexia Ogg and May E. Rowland, my bank accounts in the Emigrant Industrial Savings Bank, 5 East 42nd Street, Borough of Manhattan, New York City, 17, New York, and in the Franklin Savings Bank, Eighth Avenue and 42nd Street, Borough of Manhattan, New York City, New York, share and share alike, absolutely and forever.'

This bequest was the only gift made to Mrs. Ogg by her mother's will. Mrs. Rowland has not charged herself as executrix with the proceeds of these savings bank accounts, however, and claims them as entirely her own property due to the circumstance that on November 28, 1951 they purport to have been placed in joint account with her by her mother. The circumstances under which this change was made will presently be discussed in greater detail, because the decision of the appeal hinges upon them. Mrs. Ogg objected in this respect to the judicial settlement of Mrs. Rowland's account as executrix, and insists that these bank accounts be distributed as part of her mother's estate so that she may obtain half of them under the bequest which has been quoted. The issue is whether these funds pass under the will or to Mrs. Rowland as survivor under section 239 of the Banking Law. This question is to be resolved by whether Mrs. Creekmore validly established them as joint accounts so as to bring them within the operation of that statute. This depends upon what happened on November 28, 1951 when she signed the signature cards transferring the form of these deposits from her own name to the names of herself and Mrs. Rowland.

Fatally stricken with cancer, and suffering from a broken thigh, Mrs. Creekmore was in her final illness at the Lenox Hill Hospital in New York City. On the previous day a letter had been written at her behest by Mrs. Rowland to Mrs. Creekmore's attorney, William Matthews, which stated:

'My mother who is quite sick and a patient at Lenox Hill Hospital, has asked me to contact you to help in getting the necessary forms put through to give me complete power-of-attorney on the following bank accounts so that I may be able to pay her bills if and when necessary. Probably under name--Elizabeth M. Creekmore.

(This one primarily)

Guarantee Trust Co.

60th St. and Mad. Ave.

Emigrant

42 St. between Mad. and

5th Ave.

Franklin

8th Ave. and 42 St.

Empire

125 St.

'My mother has also requested that I be deputized to open her safe deposit box if and when necessary and I would appreciate it very much if you can obtain that form for me too. The box is No. 882 and is in the Guarantee Trust Co. 60th and Mad. Ave.

'My Father sends his best regards and asks me to tell you that he too would appreciate it very much if you would take care of this for us. He is not well himself.'

Upon receipt of this letter on November 28, 1951, Mr. Mattews procured forms of power of attorney from the Guaranty Trust Company enabling Mrs. Rowland to draw upon Mrs. Creekmore's account and to have access to her safe-deposit box. These powers of attorney were signed by Mrs. Creekmore and forwarded by her attorney to the Guaranty Trust Company. This was done simultaneously with the transactions in suit.

It was a different story at the Emigrant and Franklin Savings Banks. When Mr. Matthews arrived there as Mrs. Creekmore's emissary and requested forms for power of attorney according to her request, he was told in each instance that the bank was opposed to accepting powers of attorney, that they did so only under protest, that they had no power of attorney forms available, and recommended that the accounts be changed to joint accounts in the names of decedent and Mrs. Rowland who was to have been the grantee of the powers of attorney. This policy on the part of these savings banks did not concern the welfare or purposes of Mrs. Creekmore, but was designed to protect the banks against inadvertently cashing checks drawn by the attorney-in-fact of a decedent. Everyone knew that Mrs. Creekmore was not long for this wrld. These banks evidently did not notice or care that the course of procedure which they were recommending would materially alter the devolution of these accounts upon Mrs. Creekmore's decease.

Mr. Matthews promptly took the signature cards which the Emigrant and Franklin Savings Banks had prepared to transfer these funds into joint accounts, along with the forms for powers of attorney which he received from the Guaranty Trust Company, to the Lenox Hill Hospital, where he met Mrs. Rowland in the afternoon of the same day on which he had received her letter. After Mrs. Rowland signed the signature cards, she and Mr. Matthews went upstairs to Mrs. Creekmore's room with a notary public whom Mr. Matthews had brought with him. After the notary had been introduced to Mrs. Creekmore, Mrs. Rowland and the notary retired from the room at Mr. Matthews' request for a period of from five to ten minutes to enable him to confer with Mrs. Creekmore alone before she signed the papers. Following this brief private professional interview, Mrs. Rowland and the notary were again called into Mrs. Creekmore's room, the upper part of her hospital bed was rolled up so that she came partially into a sitting position, Mrs. Rowland put an arm around her back so as to assist her to write her name, and these signature cards were signed respecting the savings bank accounts and the powers of attorney upon the Guaranty Trust Company. The only witness who testified to this incident or to Mrs. Creekmore's condition was Mr. Matthews, who knew that 'she was very, very seriously ill' from cancer and a broken thigh. Whatever legal advice he may have given to Mrs. Creekmore during the five or ten minutes while they were alone before the others were recalled to help her sign the papers, was excluded as a confidential communication between attorney and client. Civil Practice Act, § 353.

In his decision the Surrogate , found as a fact that Mrs. Rowland 'has not shown that the alleged joint accounts were knowingly and consciously created and sanctioned by her mother', but the Appellate Division [286 App.Div. 857, 141 N.Y.S.2d 557] reversed 'on the law' at the same time stating in the order that 'the findings of fact are hereby affirmed'. This included an affirmance of the finding that these joint accounts had not been shown to have been knowingly and consciously created and sanctioned by decedent, unless the uncontroverted evidence established that they were thus created. The Appellate Division appears to have based its reversal and dismissal of Mrs. Ogg's objections exclusively upon the circumstance that these accounts were in the form described by subdivision 3 of section 239 of the Banking Law. The thought appears to have been that if they were put into the form prescribed by this statute, the effect takes place as a matter of course without further inquiry. The Appellate Division's memorandum decision states: 'The evidence shows that the accounts and the deposits therein are in form described by sudivision 3, section 239, Banking Law. Such evidence establishes conclusively the intention to vest title in the survivor to the moneys in the accounts at the time of death.'

The position of Mrs. Ogg is that the burden lay upon Mrs. Rowland to establish that their mother knew what she was doing when she signed these signature cards. She does not charge Mrs. Rowland with having schemed to subvert her mother's intention, her position being just that the mother never knew that she was signing any such thing. Consequently Mrs. Ogg has not charged her sister with practicing fraud or undue influence. The burden is still upon Mrs. Rowland to show that it was her mother's conscious act and deed. The Appellate Division held that she had sustained this burden due to the bare circumstance that the cards had been signed by her mother, in the absence of a contention that someone was trying to take advantage of her, concluding: 'There being no issue of fraud or undue influence, the survivor was not required to submit additional evidence as to the intention of the decedent. (Matter of Fenelon's Estate, 262 N.Y. 308, 186 N.E. 794; Moskowitz v. Marrow, 251 N.Y. 380, 167 N.E. 506, 66 A.L.R. 870.)'

The Fenelon and Moskowitz cases (Matter of Fenelon's Estate, 262 N.Y. 57, 186 N.E. 201; Id., 262 N.Y. 308, 186 N.E. 794; Moskowitz v. Marrow, 251 N.Y. 380, 167 N.E. 506, 66 A.L.R. 870) involved no question of incapacity, lack of volition or mistake on the part of the creator of a joint account. Before the enactment of the predecessor statute to section 239 of the Banking Law, the query had been suggested in some of the decided cases that more might be necessary to create a survivorship interest in a joint account than merely opening the account in that form, cf. Kelly v. Beers, 194 N.Y. 49, 86 N.E. 980; Schneider v. Schneider, No. 1, 122 App.Div. 774, 780, 107 N.Y.S. 792, 796. The Fenelon and Moskowitz cases put to rest that question, holding that under section 239 the executed intention to make a deposit 'in form to be paid to either or the survivor' sufficiently evinced a purpose that the proceeds of...