Eagles Bldg. & Loan Ass'n v. Fiducia
Decision Date | 21 April 1944 |
Docket Number | 149/530. |
Citation | 37 A.2d 116 |
Parties | EAGLES BUILDING & LOAN ASS'N v. FIDUCIA et al. |
Court | New Jersey Court of Chancery |
OPINION TEXT STARTS HERE
Interpleader proceeding by the Eagles Building & Loan Association against Joseph Fiducia, Natalie Fiducia and others to determine the ownership of dividends paid into court by complainant on shares of its stock issued in the name of defendant Joseph Fiducia as trustee for defendant Natalie Fiducia.
Judgment for defendant Natalie Fiducia.
J subscribed for building and loan installment shares which were issued in his name as trustee for his five-year old daughter. He or his wife made all the payments on the shares and retained possession of the pass book and stock certificate. Held, on the proofs, a valid trust was created.
Aaron Marder, of Newark, for Natalie F. Papa.
Louis Zemel, of Newark, for Joseph Fiducia.
BIGELOW, Vice Chancellor.
In 1926, the defendant Joseph Fiducia subscribed to five installment shares of the complainant building and loan association, to be issued in the name of ‘Joseph Fiducia, trustee for Natalie Fiducia’. Natalie was his five-year old daughter. The shares were issued accordingly and Joseph, or his wife, made the initial payment of $10.25 and periodic payments thereafter until maturity. The pass book and stock certificate have always been in the possession of the parents, or one of them. The association voluntarily dissolved in 1942 when the shares had a book value of $1,026. The liquidating trustees of the association have paid into court dividends of 80 per cent., or $821. Conflicting claims to the fund are made by Joseph and by Natalie.
We start with some elementary rules. A declaration of trust, or other action by the owner of property sufficient to create a trust, is effectual, although no consideration passes to the settlor. West Jersey Trust Co. v. Read, 109 N.J.Eq. 475, 158 A. 113. While the declaration of trust, oral or written, must set forth the purposes of the trust, a declaration by A that he holds certain property in trust for B, or as trustee for B, is a complete and specific declaration of an inactive or passive trust. Supreme Lodge v. Rutzler, 87 N.J.Eq. 342, 100 A. 189. The beneficiary need not be informed of the trust, and there need be no delivery of the declaration, or memorandum to anyone. Janes v. Falk, 50 N.J.Eq. 468, 35 Am.St.Rep. 783; Collins v. Lewis, 60 N.J.Eq. 488, 46 A. 1098.
In order that a gift be effectual, there must be, first, an intention on the part of the donor to make a gift, and, second, he must carry his intention into effect, for the court will not enforce an unexecuted intention or promise to give, since consideration is absent. Where the gift includes the legal as well as equitable interest of the donor, the execution of the gift, the transfer of title, occurs upon actual delivery of the subject matter of the gift, so far as the nature of the property permits, and upon the donor's stripping himself of control and dominion. Lester v. Guenther, 132 N.J.Eq. 496, 28 A.2d 777; Id., 134 N.J.Eq. 53, 33 A.2d 815. Where the donor retains the legal title and gives away only the equitable interest, a trust is created, active or passive, with the donor as trustee and the donee as beneficiary. Here the essential elements are the same, namely, a donative intention and execution by transfer of the equitable title. But the incidents of execution are not the same as when the gift includes the legal title. Passage of equitable title is not dependent on delivery. Bankers' Trust Co. v. Bank of Rockville, 114 N.J.Eq. 391, at page 407, 168 A. 733, at page 740, 89 A.L.R. 697; 38 C.J.S., Gifts, § 8, p. 785. Properly the trustee retains possession and control of the trust fund against everyone save the cestui que trust and if it be an active trust, against him too. If it be a passive, or dry trust, the trustee must surrender to the beneficiary possession and legal title, not upon creation of the trust, but upon...
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...on proof of intention, since the trust arises upon mere expression of the requisite intention. [Eagles Bldg. & Loan Ass'n v. Fiducia, 135 N.J.Eq. 7, 9, 37 A.2d 116 (Ch. 1944), aff'd, 136 N.J.Eq. 117, 40 A.2d 627 (E. & A.1945).] Accord State v. Atlantic City Elec. Co., 23 N.J. 259, 266, 128 ......
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...on proof of intention since the trust arises upon mere expression of the requisite intention.' Eagles Bldg. & Loan Ass'n v. Fiducia, 135 N.J.Eq. 7, 37 A.2d 116, 118 (Ch. 1944).' The case of American Surety Co. of New York v. Greenwald, 223 Minn, 37, 25 [227 La. 640] N.W.2d 681, 685, is pert......
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