Varley v. Sims
| Decision Date | 15 March 1907 |
| Docket Number | Nos. 15,016-(157).,s. 15,016-(157). |
| Parties | HARRY C. VARLEY v. THOMAS W. SIMS.<SMALL><SUP>1</SUP></SMALL> |
| Court | Minnesota Supreme Court |
George H. Spear, for appellant.
Alfred L. Thwing, for respondent.
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The facts in this case are as follows: On November 29, 1904, Mrs. C. H. Brown, the mother of plaintiff, had on deposit in the First National Bank of Grand Rapids, this state, subject to check, the sum of $1,168.30. She was on that date at the home of her sister, a Mrs. Wright, at West Allis, Wisconsin, and about to undergo a serious surgical operation. In view of the operation and the probability of death resulting therefrom, she drew her check on the Grand Rapids bank for the entire amount of her deposit therein, payable absolutely to plaintiff, and left the same with Mrs. Wright, instructing her to deliver it to plaintiff, who was not then present, in the event the operation resulted fatally. She also stated to her sister that, if she survived the operation, the check should be returned to her. Thereafter the operation was performed, and Mrs. Brown never regained consciousness, but died. Plaintiff was notified of the facts, but was unable to reach his mother before her death, and the check was not delivered to him until after that event. He subsequently presented it to the bank, but payment was refused. Defendant was appointed administrator of Mrs. Brown's estate, and the bank paid the money to him. Plaintiff thereafter brought this action to recover the same from the administrator, on the ground that the delivery of the check, under the circumstances stated, constituted a valid gift causa mortis to him of the funds in the bank. The cause was tried below without a jury, resulting in judgment for plaintiff, from which defendant appealed.
The only question presented is the validity of the alleged gift on which plaintiff relies for recovery. The cause was presented in this court on the oral argument and in the briefs with much ability by counsel, and the court has been aided very materially in the consideration of the question.
The essentials to a valid gift causa mortis are: (1) The gift must be made in view of approaching death from some existing sickness or peril; (2) the donor must die from that sickness or peril; and (3) there must be a delivery of the subject of the gift to the donee with the intention of passing title thereto, subject to revocation in the event of recovery from the pending illness, and an acceptance by the donee. Winslow v. McHenry, 93 Minn. 507, 101 N. W. 799, 106 Am. St. 448. The first two requisites are established in this case, viz., the delivery of the check with the intention of passing title to the money to plaintiff, the donee, and the death of Mrs. Brown. She was about to undergo a serious operation, and, in anticipation that death might result therefrom, made and delivered the check to her sister in trust, intending to give the money represented thereby to her son. She died from the peril with which she was then confronted, and the check was subsequently delivered in accordance with her instructions. That the delivery of the check to Mrs. Wright, to be by her in turn delivered to plaintiff on the occurrence of death, was a sufficient delivery, under the law applicable to such cases, the authorities fully sustain. Mrs. Wright was in contemplation of law the agent or trustee of the donee, and the delivery to her was as effectual as though it had been made personally to the donee.
In Hogan v. Sullivan, 114 Iowa, 456, 87 N. W. 447, it appeared that the donor deposited certain money in a bank, causing a certificate of deposit to be issued by the bank in the name of his son-in-law, to whom it was delivered. Two years later, in anticipation of death, he gave the son-in-law a written memorandum directing the disposition of the funds among certain beneficiaries after his death. In disposing of the question whether the delivery to the son-in-law of the certificate of deposit payable to him, and the subsequent directions by the donor for the disposition of the money among the beneficiaries, was a sufficient delivery to constitute a valid gift causa mortis, the court held that the son-in-law occupied the position of trustee for those to whom the donor intended the money as a gift, and that the delivery was sufficient and effectual. The court, in the course of the discussion of the question, remarked that it was well settled by the authorities that a gift causa mortis may be effected by a delivery to a third person in trust for the donee, though the gift does not come to the knowledge of the donee, and is not accepted by him, until after the donor's death. Of course, if the person to whom the delivery is made be the agent of the donor, and no delivery is made to the donee until after the donor's death, it is ineffectual for any purpose. The reason for this is found in the fact that to give legal effect to such a gift the present title to the property must pass to the donee, and it does not pass so long as the donor or his agent retains possession or control of it. The agent has no authority to deliver after the donor's death, for his authority as such ceases when his principal dies. Hart v. Ketchum, 121 Cal. 426, 53 Pac. 931; Daniel v. Smith, 75 Cal. 548, 17 Pac. 683; Taylor v. Harmison, 79 Ill. App. 380; Smith v. Ferguson, 90 Ind. 229, 46 Am. 216; Dunn v. German-American, 109 Mo. 90, 18 S. W. 1139.
But, unless the contrary appears, it will be presumed that the person to whom delivery is made takes as the trustee of the donee. Devol v. Dye, 123 Ind. 321, 24 N. E. 246, 7 L. R. A. 439; Johnson v. Colley, 101 Va. 414, 44 S. E. 721, 99 Am. St. 884; 14 Am. & Eng. Enc. (2d Ed.) 1061.
In the case at bar it is beyond controversy that Mrs. Wright received the check in question as the trustee of plaintiff, and for all practical purposes the delivery was to him. The matter of acceptance by the donee is of slight importance. Where the gift is beneficial, and imposes no burdens upon the donee, acceptance will be presumed as a matter of law. Barnard v. Thurston, 86 Minn. 343, 90 N. W. 574; Ammon v. Martin, 59 Ark. 191, 26 S. W. 826; De Levillain v. Evans, 39 Cal. 120; Forbes v. Jason, 6 Ill. App. 395; Darland v. Taylor, 52 Iowa, 503, 3 N. W. 510, 35 Am. 285; 20 Cyc. 1235.
This brings us to the principal question in the case, viz., whether a bank check, unaccepted by the bank, constitutes a transfer to the payee of either the legal or equitable title to the funds to which it is subject, sufficient to sustain a gift causa mortis. The validity of gifts of bank deposits, evidenced by checks, or by the delivery of passbooks or certificates of deposit, has been before the courts in numerous cases. It is held in a majority of the states of this country, and perhaps the same rule prevails in England, that an ordinary check upon a bank for a part only of the drawer's deposit, unaccepted by the bank before the death of the donor, is ineffectual as a gift causa mortis, for the reason, among others, that the check does not operate to pass to the donee either the legal or the equitable title to the funds in the bank; in other words, that the unaccepted check is not, either in law or equity, an assignment of the funds.
But a strong and vigorous minority hold that where the intention to make a gift is free from doubt, and no question of fraud or the rights of creditors is involved, the delivery of a check for a part or the whole of the deposit is sufficient, though not presented for payment until after the death of the donor. The courts so holding proceed upon the theory that the passing of a present legal title is not essential to a valid gift, that an equitable title is sufficient, and that such a title becomes vested in the donee at the time the check is delivered and becomes absolute on the death of the donor. That an equitable title is sufficient in such cases is supported by a long list of authorities. Druke v. Heiken, 61 Cal. 346, 44 Am. 553; Stephenson's Adm'r...
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