Southern Industrial Institute v. Marsh

• Decision Date: 27 October 1926
• Docket Number: No. 4835.,4835.
• Citation: 15 F.2d 347
• Parties: SOUTHERN INDUSTRIAL INSTITUTE v. MARSH et al.
• Court: U.S. Court of Appeals — Fifth Circuit

15 F.2d 347 (1926)

SOUTHERN INDUSTRIAL INSTITUTE v. MARSH et al.

No. 4835.

Circuit Court of Appeals, Fifth Circuit.

October 27, 1926.

John A. Sibley, of Atlanta, Ga. (Spalding, MacDougald & Sibley, of Atlanta, Ga., on the brief), for appellant.

Robert C. Alston, Clifford L. Anderson, Shepard Bryan, and James A. Branch, all of Atlanta, Ga., for appellees.

Before WALKER, BRYAN, and FOSTER, Circuit Judges.

BRYAN, Circuit Judge.

Southern Industrial Institute, appellant, filed its bill in equity to establish its title to 134 shares of common stock and 110 shares of preferred stock of the Bibb Manufacturing Company. Appellant is an educational institution, situated in Alabama, and bases its claim of title upon an alleged gift of the stock to it by the admitted owner, Francis M. Marsh, a few days before his death. Marsh's widow and the executor of his will, appellees, defended the suit on the ground that a valid gift had not been made, because there had been no delivery of the stock.

Marsh was a successful business man, and lived in Atlanta, Ga. He was president of the Atlanta Table Company, with offices in Atlanta. In February of 1922, Marsh visited the Institute, was favorably impressed with it as an educational institution, and in May of that year executed a will in which he made it residuary legatee of his entire estate. About the beginning of the year 1925 his health had become so impaired that he realized he had not long to live, but he went almost daily to his office, and directed his business until April 16 of that year. He died on April 27. In February he made large gifts of stocks and bonds to the Institute, and at that time he gave the stock which is the subject-matter of this suit to a Mr. and Mrs. White. He made the gifts effectual by indorsing the stock certificates and delivering the indorsed certificates to the donees. On March 12 he made a new will, and again named the Institute residuary legatee. A few days later he had the Whites to surrender the stock given to them, and had new certificates issued to himself.

Dr. Lyman Ward, president of the Institute, testified that early in April he was at Marsh's home, and Marsh told him that he had taken back the Bibb Company stock from the Whites, and that the Institute would get that stock; that the witness then stated that he was planning to go to California, and suggested that the stock be transferred immediately, but Marsh replied that was unnecessary, and said "that if anything happened to him before I came back that stock would all be transferred, and Mr. Stewart would hand it to me." On April 13 Ward wrote to Marsh that he had given up his contemplated trip to California. Marsh received the letter, and on April 14 caused A. H. Stewart, the office manager of the Atlanta Table Company, to answer it. On April 11 Marsh wrote a letter to the Citizens' & Southern Company, requesting it to secure the transfer of the Bibb Manufacturing Company stock to the Institute, and gave its address, Camp Hill, Ala., but directed that the new certificates of stock be returned to him; and on April 15 the Citizens' & Southern Company by letter advised Marsh that it was in position to make delivery of the stock. On the 16th, in reply, Marsh signed an order to deliver the stock to Stewart. Stewart did not see Marsh again before the latter's death, but he procured the certificates of stock as directed and placed them in the safe in Marsh's office. Stewart testified that Marsh, in discussing the gift of stock to the Institute, stated that he wanted the Institute to have it, but that he wanted to make delivery in person, that at the time of delivery he intended to require a written agreement from the Institute securing to him the income from the stock during his life, and that it was in pursuance of this purpose that the letter of April 11 to the Citizens' & Southern Company contained the instructions that the new certificates of stock should be returned to Marsh.

The District Judge, as stated in a written opinion, concluded from the evidence, which was taken in his presence, that Marsh intended "to give the stock to the Institute, but to exact an agreement that the dividends be paid to him during his life, and that his belief was that the transfer of the certificates and registration of the company's books in the name of the Institute would operate to entitle it to the stock in case of his death, and that he did nothing further because of this belief. * * * He intended to put the title to the stock out of his estate and into the Institute, if he should presently die, but to control it for further stipulations if he should live to make them. Because of the latter intent he did not deliver to the Institute either the indorsed old certificates or the new ones; because of the former intent he had certificates issued in the Institute's name, instead of simply holding the indorsed old certificates until the stipulations could be made. But the latter intent disappoints the former one, because it destroys that present absolute and unconditional parting with dominion which is necessary to effectuate a gift. The new certificates were held by Marsh, not because he was the proper final custodian of them, nor because it was inconvenient or impossible to get them to the Institute, but in order that terms might be imposed on the gift." Consequently the bill was dismissed.

The wills of Marsh are mentioned for the purpose of throwing light on his...