Rand v. Moore

• Decision Date: 16 December 1981
• Docket Number: No. 52874,52874
• Citation: 414 So.2d 885
• Parties: 32 UCC Rep.Serv. 1539 Pinkie RAND, Ethel Mae Battle and Ross Coleman v. Neola MOORE, Administratrix of the Estate of Herbert Moore.
• Court: Mississippi Supreme Court

Page 885

414 So.2d 885

32 UCC Rep.Serv. 1539

Pinkie RAND, Ethel Mae Battle and Ross Coleman v. Neola MOORE, Administratrix of the Estate of Herbert Moore.

No. 52874.

Supreme Court of Mississippi.

Dec. 16, 1981.

Rehearing Denied Feb. 3, 1982.

Cothren & Pittman, Wayne E. Ferrell, Jr., Jackson, for appellants.

Montgomery, Varnado, Garrard & Trotter, H. R. Varnado, Jr., Belzoni, for appellee.

Before SMITH, WALKER and BOWLING, JJ.

WALKER, Justice, for the Court:

This is an appeal from the Chancery Court of Humphreys County wherein the chancellor found that two certificates of deposit issued by the Citizens Bank & Trust Company of Belzoni were the property of Herbert Moore at the time of his death and should be included among the assets of his estate.

Feeling aggrieved by the court's ruling and decree, the appellants appeal.

The two certificates of deposit were issued by the Citizens Bank & Trust Company of Belzoni, Mississippi. Certificate of deposit No. 1192 was issued by the Bank on February 1, 1970, in the principal amount of $1,178.39 payable to Herbert Moore P. O. D. Pinkie Rand--Ethel Mae Battle. The chancellor found that this certificate was in the possession of Herbert Moore at the time of his death and was an asset of his estate.

Pinkie Rand and Ethel Mae Battle did not receive any present interest in the certificate when it was issued. During the lifetime of Herbert Moore, he was the only person who could negotiate the certificate. This, he did not do. In their pleadings, the heirs of Pinkie Rand and Ethel Mae Battle contend that the abbreviation P. O. D. means "Payable on Death," therefore, it is patent "P. O. D. Pinkie Rand--Ethel Mae Battle" was an attempt by Moore to make a testamentary disposition of the certificate upon his death which failed because, among other things, it was neither in the handwriting of Herbert Moore nor signed by him and did not otherwise conform to Mississippi Code Annotated section 91-5-1 (Supp.1981) on the execution of wills. Matter of Collier, 381 So.2d 1338 (Miss.1980); Buchanan v. Buchanan, 236 Miss. 751, 112 So.2d 224 (1959).

The Bank issued certificate of deposit No. 1189 on October 1, 1970, in the amount of $6,618.00 payable to Herbert Moore. During Herbert Moore's lifetime he endorsed his name on the back of the certificate and physically delivered it to Ross Coleman. Coleman was allowed to testify, over objection of the appellee, that he and Herbert Moore were cousins and that Moore had visited him in 1972 and had given him the certificate of deposit No. 1189 with his endorsement on the back thereof. He also testified that Herbert Moore had given him a horse and a truck on an earlier occasion when he left Belzoni. He also testified that Moore had never again mentioned the certificate to him. The validity of Moore's signature on the instrument was not challenged by appellee.

The trial court properly overruled the appellee's objection to the testimony of Ross Coleman, which objection was made on the grounds that it was in violation of the so-called dead man statute, Mississippi Code Annotated section 13-1-7 (1972). Coleman's testimony was competent because the appellee propounded interrogatories to Coleman with reference to the gift of certificate No. 1189 and by so doing made Coleman a witness and thereby waived any privilege that the estate might have had under the dead man statute. The appellee had the right to waive the privilege on behalf of the estate since her suit was seeking to recover assets for the benefit of the estate. Lipson v. Lipson, 183 So.2d 900, 906 (Miss.1966). Taking the deposition of, or serving interrogatories upon, a person who would otherwise be incompetent as a witness under the dead man statute is the equivalent of calling such person as a witness and is a waiver of the witness' incompetency. Lipson, supra; 81 Am.Jur.2d Witnesses Sec. 407 (1976); citing Fant v. Fant, 173 Miss. 472, 162 So. 159 (1935).

The certificate claimed by Ross Coleman, No. 1189, was made payable to Herbert Moore and was endorsed in blank on the back by Herbert Moore. The certificate admittedly did not contain the words payable to the "order" of Herbert Moore nor was it payable to "Herbert Moore or bearer." Therefore, it is contended by the appellee that absent the so-called magic language "order" or "bearer" the certificate of deposit was not negotiable in character and could not be transferred simply by the endorsement of Herbert Moore on the back thereof.

Except for the language "payable to order" or "payable to bearer," certificate No. 1189 contained all of the necessary attributes of a negotiable instrument as required by Mississippi Code Annotated section 75-3-104 (1981). ¹ It was signed by the maker, contained an unconditional promise to pay a sum certain in money, and was payable at a definite time. However, although the "order" or "bearer" language did not appear on the face of the instrument, Mississippi Code Annotated section 75-3-805 (1981) allows transfer of this type instrument by proper endorsement. That section provides:

Instruments not payable to order or to bearer.

This chapter applies to any instrument whose terms do not preclude transfer and which is otherwise negotiable within this chapter but which is not payable to order or bearer, except that there can be no holder in due course of such an instrument.

When an instrument fails of negotiability because it does not contain words of negotiability, some courts have called it a mercantile specialty and permitted the rules of negotiable instrument law to govern it, except that no holder could be a holder in due course. Other courts have held such an instrument to be only a simple contract, falling outside the purview of the old Uniform Negotiable Instrument Act. However, section 3-805 of the Uniform Commercial Code, codified in this State as section 75-3-805, resolves this conflict of authority by adopting the first-stated view. Under section 75-3-805, an instrument, nonnegotiable only because it fails to contain words of negotiability, may be transferred by...