Russo v. Russo

• Decision Date: 31 July 1961
• Citation: 218 N.Y.S.2d 413
• Parties: Renee R. RUSSO (formerly known as Noreen Russo), Plaintiff, v. Thomas RUSSO, Defendant.
• Court: New York City Municipal Court

Page 413

218 N.Y.S.2d 413

Renee R. RUSSO (formerly known as Noreen Russo), Plaintiff, v. Thomas RUSSO, Defendant.

Municipal Court of City of New York, Borough of Bronx,

Second District, Central Jury, Part II.

July 31, 1961.

Joseph B. Franklin, New York City, for plaintiff.

Michael A. Di Salvo, New York City, for defendant.

LOUIS PECK, Justice.

The parties herein having waived trial by jury, this case presents itself for decision upon a stipulated set of facts which, briefly, are as follows:

Plaintiff and defendant were married on March 14, 1957, at which time defendant husband maintained a bank account in the Dollar Savings Bank under account No. 287894. Shortly after the marriage the said account was made a joint account in accordance with the form prescribed by Banking Law, § 239, subd. 3, as follows: 'Thomas Russo or Mrs. Noreen Russo, payable to either or survivor.' On or about January 27, 1960, the parties became separated and on or about March 3, 1961 a judgment of separation was entered in the office of the Clerk of the County of the Bronx in favor of the plaintiff. When the parties separated, there was a balance in the amount of $6,298.71. On March 4, 1960, the defendant withdrew from the said account the sum of $5,000 and on June 15, 1960 he withdrew the sum of $1,310.06 which represented the balance then remaining.

Plaintiff, conceding that she did not contribute any funds toward the said account, now seeks $3,000 from defendant on the theory that she has title to a moiety of the funds formerly in the joint account as a joint tenant and that her title could not be divested by the unilateral action of defendant. Plaintiff sues for $3,000 in order to bring herself within the jurisdiction of the Court. Plaintiff relies heavily on Banking Law, § 239, subd. 3, and cases decided thereunder. Defendant, in turn, claims that he only conferred a right of survivorship upon plaintiff when he transferred his funds into a joint account. Defendant would limit the application of Banking Law, § 239, subd. 3, to those cases where one of the depositors named in the joint account is deceased and the surviving depositor seeks full title to the account.

In 1929, the Court of Appeals was required to construe this statute (then Banking Law, § 249) in Moskowitz v. Marrow, 251 N.Y. 380, 167 N.E. 506, 66 A.L.R. 870, upon the following facts: On April 28, 1924, Fannie Manheimer, the holder of individual accounts in four banks, established joint accounts therein, credited to Fannie Manheimer and Pearl Harris, her granddaughter, payable to either or the survivor of them; on December 5, 1924, Fannie Manheimer 'delivered a writing to each of the four banks, notifying each that the 'privilege' granted by her to Pearl Harris 'to withdraw any money or moneys frm my account or joint account in your bank' was revoked and instructing each to honor no signature other than her own for any withdrawal; 'in January, 1925, Fannie Manheimer withdrew the deposits from two of the four banks and redeposited them therein to the credit of herself individually; in April, 1925, Fannie Manheimer directed tha the accounts in the two banks be re-established in the joint names of herself and Pearl Harris payable to either or the survivor; May 4, 1925, Fannie Manheimer died; shortly thereafter Pearl Harris withdrew the funds from three of the banks. The action was brought by the executors of the last will and testament of Fannie Manheimer to recover from Pearl Harris the moneys withdrawn by her.

The plaintiffs in Moskowitz laid emphasis upon the last sentence of Banking Law, § 249 (as the defendant herein does upon the last sentence, Banking Law, § 239, subd. 3, the successor to Sec. 249.) They urged, in the words of the Court, that:

'A deposit in the statutory form will constitute evidence of an intent to give, but this evidence will be available only in an action to which either a savings bank or 'the surviving depositor' may be a party. The intent which it will evidence in any action is an intention of the depositors 'to vest title to such deposit and the additions thereto in such survivor.' The form of the deposit in an action between the depositors themselves, will have no probative value * * * From these premises results the conclusion that the deposits are ineffective to transfer title until the death of the original depositor; that meanwhile the deposits are revocable at will by such depositor.' 251 N.Y. at page 388, 167 N.E. at page 508.

The Court rejected this argument, saying:

'If it were a fact that all the provisions of section 249, as they now appear therein, were enacted as a completed whole at one and the same time, there might be force in the argument. * * * However, as we have seen, section 249 was not enacted as a completed whole, at one and the same time. Long before the added provision, relied upon by the plaintiffs, became a law, other provisions, now contained in section 249, were present in former section 144. These provisions, standing alone, sanctioned a presumption from a deposit in the statutory form, although not a conclusive presumption, that a transfer of an interest in the funds deposited was intended and had been effectuated.' 251 N.Y. at pages 388-389, 167 N.E. at page 508. [Defendant, therefore, reads section 239, subd. 3 too narrowly.

'When a deposite shall be made by any person in the names of such depositor and another person and in form to be paid to either or the survivor of them * * *' (Banking Law, § 239, Subd. 3), a joint tenancy is presumed to have been created, which presumption becomes conclusive when survivorship ensues.]

If the Court of Appeals had stopped at this point, plaintiff's reliance upon this case would have been proper. The Court, however, went on to draw a key exception to the above presumption which supports the defendant's contention (despite his misconstruction of the statute) that he is entitled to all of the moneys he has withdrawn from the joint bank account. The plaintiffs in Moskowitz argued that the transfer by Fannie Manheimer was only a tentative one, incomplete until one joint depositor died. 251 N.Y. at pages 390-391, 167 N.E. at page 509. The plaintiffs therein relied upon three cases, Matter of Totten, 179 N.Y. 112, 71 N.E. 748, 70 L.R.A. 711, Matter of Albrecht, 136 N.Y. 91, 32 N.E. 632, 18 L.R.A. 329, and Matter of Kane's Estate, 246 N.Y. 498, 159 N.E. 410. After distinguishing the Totten case as one involving a creation of a trust, the Court of Appeals said:

'In the other two cases the subject considered was either the purchase of securities by a husband with moneys of his own, or the deposit of such moneys, in the joint names of himself and wife. It was held that such a transfer possessed all the essential qualities of a gift causa mortis, and was revocable by the husband before his death. This rule presents an exception if not an anomaly in the law of property, and is applicable only in the case of a gift by a husband to his wife of property or moneys belonging solely to himself. * * * In such an instance the husband and wife never become joint tenants in the true...