Cross v. Pharr

• Decision Date: 06 June 1949
• Docket Number: 4-8897
• Citation: 221 S.W.2d 24,215 Ark. 463
• Parties: Cross v. Pharr
• Court: Arkansas Supreme Court

221 S.W.2d 24

215 Ark. 463

Cross v. Pharr

No. 4-8897

Supreme Court of Arkansas

June 6, 1949

Appeal from Miller Chancery Court; A. P. Steel, Chancellor.

Affirmed.

T B. Vance and James F. Vance, for appellant.

Smith & Sanderson, for appellee.

OPINION

Griffin Smith, Chief Justice.

J. W Pharr executed his last will September 2, 1926, and died April 1, 1928. A son, F. E. Pharr, was named executor, with power to close the estate "without being required to execute bond, and without [the necessity] of accounting to the Probate Court, or having any probate proceedings other than proving up this will."

After providing for payment of debts the estate, both real and personal, was devised and bequeathed "absolutely and in fee simple" to F. E. Pharr, with the right to manage, invest, reinvest, sell, etc. This power, however, was in the nature of a trust to continue for the lifetime of the testator's wife, Cary Ann Pharr; and during that period the executor or trustee was to pay Mrs. Pharr the net income arising from the estate, . . . "when and as the same may be needed by my said wife."

Cary Ann Pharr died August 7, 1947, and F. E. Pharr died September 1, 1939. State National Bank of Texarkana was appointed to succeed F. E. Pharr as executor, or trustee.

State National, treating itself as trustee accountable to a court of equity, filed its final settlement December 18, 1947, and in a chancery proceeding asked to be discharged. Lessie Surgeon Pharr was named as a defendant; and, with the Bank, is an appellee here. She is the widow and sole devisee of B. C. Pharr, a son mentioned in the second subdivision of Item III of the will, who died November 26, 1947 -- a little less than four months after his mother. If B. C.'s portion of his father's estate vested without affirmative action by the trustee Bank, when Cary Ann Pharr died, the decree respecting that interest is correct, requiring only a determination of what the interest was.

Appellants, some of the defendants below, are the surviving heirs of Elizabeth Pharr Cross, who is mentioned in the will, but who predeceased her father. By testamentary expressions Elizabeth's heirs were to stand in her stead.

The appealing defendants contend that the interest apportionable to B. C. Pharr, if he had lived, lapsed when the trustee failed during B. C.'s lifetime to terminate the trust by an actual distribution of the property. The appellants also think the Bank's action in making certain payments to Cary Ann Pharr was unauthorized, and that the Bank should be charged with $ 15,649.22 representing a joint checking account used by J. W. and Cary Ann Pharr.

We deal with the subjects in reverse order.

For many years F. E. Pharr was chairman of the Bank's board of directors, and as such was active in the institution's affairs until shortly before his death. W. B. Oglesby was vice-president and trust officer, and testified. Ledger sheets and signature cards were identified, showing that on July 1, 1927, J. W. Pharr had a credit balance of $ 3,842.38, designated as account numbered 13,680. Mrs. "C. A. P. Pharr" -- identified as Mrs. Cary Ann Pharr -- had a separate account, No. 8021. It showed a balance of $ 3,782.80. On the sixth of July, 1927, new account No. 16,696 was opened in the names of "J. W. or Mrs. C. A. P. Pharr." To this account there was first credited $ 3,842.38, then $ 11,500. A credit indorsement of January 1, 1928, was "interest, $ 306.84." [Seemingly 4% for six months on the two items aggregating $ 15,342.38]. With this entry the account showed a balance of $ 15,649.22. When J. W. Pharr died he had a checking account with a balance of $ 1,430. The money was used to pay expenses not questioned here.

More than nineteen years -- April 1, 1928, to August 7, 1947 -- elapsed between the death of J. W. Pharr and the death of his wife. During that period the trustees collected income on property owned by the decedent, of which slightly more than $ 10,000 came from commercial stocks. As a result, Cary Ann Pharr's credit balance October 29, 1936, was $ 28,415.47. Appellants say there was more than $ 15,000 of unused funds after withdrawals of $ 13,000 in 1944-'45-'46. The balance was $ 24,617.95 when Mrs. Pharr died.

The Bank's records fully sustain appellees' contention that it was J. W. Pharr's intention, when the joint account was opened, to establish a relationship whereby Cary Ann Pharr would, if the testator predeceased her, take by the entirety. The writing was that ". . . each [agrees] with the other, and with the . . . Bank" that the funds were jointly owned, "with the right of survivorship."

We held in Black v. Black, 199 Ark. 609, 135 S.W.2d 837, that an estate by the entirety could be created in personal property, and that when B, having a bank account, changed the status in a way making his wife joint owner, the surviving tenant took by the entirety. In that case a distinction was made between the bank deposit and money kept in a lock box. The case is conclusive of the survivorship rights contended for in the appeal here. The transactions clearly show J. W. Pharr's intention that ownership of the balance at the time he died would pass, thus saving Mrs. Pharr the cost and inconvenience of administration and eliminating claims to distributive shares.

Appellants complain that records identified by the witness Oglesby were not sufficient to establish J. W. Pharr's purpose to maintain the joint bank account with right of survivorship and point to the...