Not overruled or negatively treated on appealinfoCoverage
Court of Errors and AppealsApr 25, 1941
129 N.J. Eq. 481 (N.J. 1941)
129 N.J. Eq. 48120 A.2d 1

Cases citing this case

How cited

  • Price v. Reilly

    …The conveyances under which Mrs. Reilly now claims ownership, must be held valid. LeGendre v. Goodridge, 46…

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Argued February 7th, 1941.

Decided April 25th, 1941.

1. Complainant, a widow of 70, married defendant, aged 40, and within three months transferred to him one-half, or 4,172 shares of the capital stock she owned in a certain corporation controlled by her. At her request, defendant was elected president of the corporation and his salary fixed at $15,000 per year; at the annual meeting directly succeeding the transfer of the shares his salary was raised to $25,000 per year. After complainant had sent a written notice to the corporation claiming fraud in connection with the stock transfer, she executed a gift tax report to the government and paid $12,788.81 tax, the report stating the consideration for the gift as "love and affection and to provide the husband with an independent income for his own uses and purposes." Upon a consideration of all the evidence, held, the stock transfer was not improvident, for complainant retained an ample, independent portion; and there was no fraud practiced on the complainant, either in the execution of the assignment of the shares, or of the gift tax return.

2. If it be assumed that there was fraud committed in the execution of the assignment of the shares, complainant was fully aware thereof when she executed the gift tax return some ten months later and paid the gift tax to the government, and she thereby elected to stand by the gift and not insist on fraud under her notice to the corporation.

3. Complainant, notwithstanding her age and lack of previous business experience, was possessed of all her faculties and was fully capable of realizing that marriage was not always tranquil and that the disparity between ages made the contemplated union a hazardous undertaking. She fully understood the transaction whereby she transferred the shares in question to defendant, and was capable of realizing that a gift freely bestowed could not be recalled. Likewise, she had a thorough knowledge of, and it was her own idea and insistment that the steps whereby defendant was elevated to the presidency of the corporation and given the salary he received, be taken by the directors of the corporation.

4. The fact that complainant was deposed as vice-president of the corporation and deprived of her $5,000 yearly salary after she had separated from her defendant husband, or that the officers may mismanage the affairs of the corporation to her detriment, does not form a basis for the relief she seeks in Chancery — the return of the shares in question.

5. Complainant seeks to recover the amount of an alleged joint bank account which she claims her husband withdrew in fraud of her. Recovery denied. The evidence establishes that all of the deposits were made by the defendant, that complainant withdrew more than the amount belonging to her, and that the money withdrawn by defendant was used for household expenses.

On appeal from a decree of the Court of Chancery advised by Vice-Chancellor Sooy, who filed the following opinion:

"Complainant, a woman now 73 years of age, married the defendant, now 43 years of age, on April 4th, 1935, at which time the complainant had been a widow for 15 years. She was the owner of 8,344 shares of the capital stock of E. Pritchard, Inc., which had a value, as fixed by the executors of the estate of her brother, Edward Pritchard, of over $800,000, as well as other valuable assets which she had received under the will of her brother, who died on June 1st, 1933. The stock aforesaid, for the purpose of the fixing of the amount of the gift tax hereinafter referred to, was valued at $60 per share as of June, 1935, and was represented by one certificate of stock for 8,344 shares.

"One-half of the stock was transferred by the complainant to the defendant on June 27th, 1935, which transfer to complainant's husband, she alleges, was procured by fraud on his part, and she seeks its return.

"Complainant also seeks to recover the amount of an alleged joint bank account which she says her husband withdrew in fraud of complainant.

"At the conclusion of the final hearing the court announced that its understanding of the law applicable to this case was that the principles stated in the case of In re Fulper, 99 N.J. Eq. 293, governed, to which statement counsel for all parties agreed in open court and in the briefs thereafter submitted. I quote from the above case (at p. 302):

"`The principles here involved are those relative to transfers from the subordinate one of two persons, between whom exists a relationship of trust and confidence to the dominant one. Where such a transfer has been made, it is voidable (in the absence of equitable defenses) at the instance of the transferor (or those standing in his stead) if there was any deception, if there was any undue influence, if there was any unfairness, any concealment, any coercion, or if the transaction was not thoroughly understood by the transferor. In any case, where the avoidance of such transfer is sought, there is a (rebuttable) presumption on all these points adverse to the transferee, and the duty is cast upon him to overcome that presumption, upon each point, by a preponderance of the evidence. If he fails so to do, on any one of the points, the transfer will be set aside.'

"See, also, Peppler v. Roffe, 122 N.J. Eq. 510 and Croker v. Clegg, 123 N.J. Eq. 332. The transfer by complainant was not improvident, as defined in the Fulper Case. She retained an ample independent portion.

"A chronological and superficial perusal of the happenings before and after the marriage between complainant and defendant would make it appear that defendant married complainant for the sole purpose of getting a sizable portion of her fortune as quickly as possible, with a hasty exit thereafter, but there is another side to the picture that must also be considered, and from that it would appear that the 70-year-old complainant wanted a young husband and was willing to pay for the anticipated pleasure of having him. This she had a right to do and in so doing she bought for better or worse, in so far as she was not deceived into so doing by him, and a gift from her to him, fairly made, without any deception on his part and without any unfairness, concealment or coercion, with a thorough understanding of the nature of the gift on the part of complainant, constitutes a valid gift, and it is from this standpoint that the evidence adduced must also be considered.

"The complainant met the defendant at her brother's funeral in June of 1933, having had a speaking acquaintance before that time, and I think it a fair inference that she sought his society thereafter. In October of 1934, she took an apartment on Riverside Drive in New York City, where defendant visited her at her invitation and subsequently took dinner with her once or twice a week, resulting in a final engagement of marriage on March 17th, 1935.

"I think the evidence justifies the conclusion that the wedding date was first set for the following September but that it was complainant's importunity that hastened the event.

"The evidence further justifies the finding that complainant, after the death of her brother, was not satisfied with the management of the Pritchard Company, in which the bulk of her wealth was invested, and that she did not trust the officers and directors thereof, with the exception of a Mr. Richardson, and that she wanted defendant, as her husband, to take charge, with the hope that he would rehabilitate, reorganize and conduct the business in a manner more satisfactory to her, and this notwithstanding the fact that the defendant had no experience in that business at or prior to the time of their marriage. He had been an employe of an insurance company at $40 per week. It would seem that complainant's trust in her husband's ability to handle the corporate business was justified by after events. It is true that the court refused to hear testimony on this point, but the offer to show the financial position of the corporation under defendant's management was made in good faith and there is nothing in the testimony that would justify any inference other than as above indicated.

"Before adverting to the chronological events succeeding the engagement, let it be said that complainant, notwithstanding her age and lack of previous business experience, was possessed of all her faculties and was fully capable of realizing that the matrimonial sea was not always tranquil and that the disparity between ages made the contemplated union a hazardous undertaking. She knew she was taking her intended husband for `better or worse' and was capable of realizing that a gift freely bestowed could not be recalled.

"Before the wedding, to wit, on March 19th, 1935, two days after the engagement, defendant was elected president of the corporation at the request of complainant, she having transferred to him one share of her stock and having arranged for the reorganization meeting of the corporation in the offices of her attorneys, Alexander Green, of New York City, at which meeting, at her request, defendant's salary as president was fixed at $15,000 per year, the salary of the former president having been $10,000 per year.

"At the annual meeting on July 17th, 1935, approximately four months thereafter, the salary of the defendant was raised to $25,000 per year, and at this meeting the defendant held 4,172 shares of the stock of the Pritchard Company as the result of the transfer to him of one-half of complainant's stockholding interest in said company, the date of which transfer was June 27th, 1935. To this raise in salary complainant consented.

"At the meeting aforesaid complainant was elected vice-president at $5,000 per year.

"Complainant was not personally present at the director's meeting aforesaid, nor at the stockholders' meeting, but did appear by proxy through a Mr. Knoeppel, an attorney of New York City, who she now says she never knew before the signing of the proxy, and she also says that she never knew anything about what transpired at the directors' meeting; that when she signed the proxy she did not understand its purport nor was it explained to her. I am satisfied, however, that she is mistaken in this, that she did know Mr. Knoeppel before this meeting and that he had drawn her will before that time, and I am further satisfied that she was fully advised as to what happened at this meeting and knew that she signed the proxy so that her stock could be voted. Mr. Knoeppel and others testified that complainant refused to attend either meeting and gave as a reason that she did not want to meet a Mr. Peacock and other directors with whom she was dissatisfied at that time. That she was very angry at this gentleman appears all through her testimony.

"After the meeting aforesaid, Knoeppel and the defendant returned to complainant's house, ate dinner together at a hotel in Bridgeton, after which, at about 10 o'clock, they motored to Philadelphia, where Mr. Knoeppel took a train for New York. Mr. Knoeppel and the defendant say that they fully advised the complainant of the happenings at the directors' meeting and notwithstanding her denial, I am satisfied that they did. It is hard to assume that so many hours could have been spent together without her business affairs having been discussed, especially in view of the fact that complainant's attainments are not such as to warrant the belief that she could carry on a conversation which would have been entertaining to all parties concerned and have consumed the time they spent together. Peace then reigned between the husband and wife and the thing that was uppermost in their minds, or at least in the mind of complainant, was the success of the Pritchard Company, and a feeling of contentment with her husband is evident by her correspondence at and prior to this time.

"From all the above it appears that the complainant had secured what she wanted, as she saw it, a young, capable husband she could trust to manage her business and return her love. She was perfectly satisfied that his pay should be higher. She would share in its expenditure. She had theretofore been a lonely widow with no living relatives, dependent in so far as the affairs of the corporation were concerned, on men she distrusted, with no one to advise with her other than paid attorneys.

"After July of 1935 squalls rippled the tranquil waters that from time to time became quite storm-tossed, particularly in May of 1936, but calm spells intervened, so that both parties continued to live together until June of 1936, and I think each of them made earnest efforts to accommodate themselves to the life they had undertaken together.

"June 27th, 1935, is the eventful date which preceded the July meeting aforesaid. It was on this date that the transfer of the 4,172 shares of stock was made to the defendant. It must not be lost sight of that during all this time complainant knew of the $25,000 salary and that defendant was assuming the responsibility of the presidency of the corporation and managing it, with complete control, and prior to this date, but in the month of June, complainant had executed a will making him the residuary legatee and giving him a large part of her estate.

"The question now is, what was the actual transaction with reference to the transfer from complainant to defendant of one-half of her holdings in the corporation? Complainant says that from the time of their marriage defendant continuously harped about his embarrassment by reason of his one share holding in the corporation, in view of his being president thereof, and that he was being held up to ridicule by the other officers and employes of the company. Before June 27th, 1935, the stock certificate for 8,344 shares was taken from the office of Alexander Green and put in the office safe at 327 Spring street, New York City. Complainant says that this was brought about by the defendant. I think not. I believe complainant had lost faith in Mr. Gulick, of the firm of Alexander Green, because of a real or fancied dual representation by that firm in connection with the sale of the Pride of the Orchard Farm, as well as the amount of fees charged by that firm. The settlement in this matter was in April of 1935, and it was after this that Mrs. Stewart caused her personal belongings, including the stock in question, to be removed to the offices of the corporation under Mr. Stewart's care.

"I think that after the securities were put in the safe at the office, complainant at times wanted to regain possession thereof, that the defendant thought these demands were whimsical and that the securities were in a safe place. There is quite a little uncertainty about just where the stock certificate for the 8,344 shares was prior to the alleged gift of June 27th, 1935, but it would seem to make no difference whether it was at the office or in Alexander Green's possession. In either event, Mrs. Stewart, if she intended to make a birthday gift to her husband, could have procured it as well from one place as the other, and could have executed the assignment either at the house or the office, and likewise, if the defendant had it at the office, still the question would be, what happened when Mrs. Stewart signed the assignment? I think the evidence justifies the finding that the actual execution of the assignment of stock was at the home on June 27th, 1935, and that the stock certificate assigned by complainant and witnessed by Arabella Speller was taken to the office on the following day, where the bookkeeping entries were made, the split-up of the stock certificate occurred and Mr. Richardson affixed his signature as a witness.

"All witnesses, including complainant, agree that Arabella Speller was not at the office and all agree that the actual business of transferring the stock on the books of the company, the issuing of new shares in lieu thereof, was made at the office of the corporation.

"Complainant says that when she went to the office she waited some time because the defendant advised her that Mr. Richardson was not in. She further says that when Mr. Richardson came in the defendant slipped a paper in his hand and that he, Richardson, said to complainant, `Sign it.' This she did and she says that she thereupon remarked, `I wonder if I am doing right?' to which the reply was made, `It is too bad if you can't trust your husband.' She says that she thought she was signing to get her stock, i.e., she thought her signature was to a receipt or release; that she did not get any certificate, either for 8,344 shares or 4,172 shares, and that defendant said he would bring it home, but that he retained it until after the Canner's Convention in February of 1936, held from the 20th to the 24th of that month, and she further says that when the defendant brought her stock home she did not examine it, but still thinking it was for 8,344 shares, she took it to Mr. Gulick and at his office ascertained that the certificate was for 4,172 shares and not 8,344, whereupon, on March 20th, 1936, a written notice was sent to the corporation, as hereinafter indicated.

"Now then, we have this situation. Complainant contends that prior to June 27th, 1935, defendant had forced Arabella Speller, the housemaid, to affix her signature as a witness to the assignment of 4,172 shares of the certificate for 8,344 shares to the defendant; that this was done without complainant's knowledge and before she had signed the assignment, and that her signature was affixed to the assignment at the office of the corporation and not at her home, where Arabella had signed as a witness.

"Defendant and Mr. Richardson both say that the signature of complainant appeared on the assignment when Mr. Richardson signed the same as a witness at the office of the corporation. Mr. Richardson says that Arabella's signature was also on the assignment and that in the office he asked complainant whether she acknowledged her signature affixed to the assignment and that she said she did, and that she further said she had made a birthday gift to her husband of one-half of her stockholdings in the Pritchard Company. He further says that the reason he signed as a witness was because he was advised that the Stewarts intended dispensing with the services of Arabella because of her illness. Both Mr. Richardson and defendant say that Mrs. Stewart signed nothing at the office.

"There is one outstanding obstacle to the probability of the story of complainant, and that obstacle corroborates defendant and Mr. Richardson. Complainant admits that with the exception of the signatures of Arabella Speller and Mr. Richardson, the handwriting contained in the entire assignment is hers, i.e., she signed it herself and filled in the name of the assignee `Norman W. Stewart' and that she herself wrote the following words, `forty-one hundred and seventy-two' shares, and that she herself also wrote `June 27th, 1935.'

"How may complainant say that the paper which was thus composed and signed by her was placed before her by her husband so that she did not know what she was signing, or how can she say that all she did at the office was to sign her name to it? Does it not clearly appear that the defendant is correct when he says it was signed at the house the night before in the presence of Arabella? All witnesses agree that Arabella was not at the office at any time, and the evidence on the face of the assignment itself repudiates the story as told by complainant and in so doing corroborates the testimony of defendant, Richardson and Fahr, and in so doing repudiates Mr. Murphy.

"I find as a fact that complainant filled in the blank assignment and signed it on June 27th, 1935, at her home, and that she did not sign it at the office of the corporation, but simply admitted her signature before Mr. Richardson witnessed the assignment.

"With the above finding of fact, how could complainant's testimony to the effect that she never knew of the gift or assignment until when she took the stock certificate to Mr. Gulick in March of 1936, at which time notice to the corporation was sent that the stock had been obtained through fraud, be upheld? It cannot be, and the finding must be that she did know that she had transferred her stock on June 27th, 1935, and had knowledge thereof at all times thereafter. This is made more clear by the fact that in April of 1936, even after the notice of the March aforesaid, in which she claimed fraud, complainant executed a gift tax report to the government and paid as a tax on the gift $12,788.81. At the time she executed this gift tax return and paid the tax, Mr. Gulick, of Alexander Green, surely represented her. She did not again take her securities from him until May 7th, 1936, when she receipted therefor to Mr. Gulick, at which time she again turned them over to defendant and re-took them from him on May 26th, 1936, as is evidenced by her receipt to him of that date. The receipt of May 7th, aforesaid, clearly sets forth the stock certificate as being for 4,172 shares.

"Mrs. Stewart is either confused or unwilling to testify truthfully as to this gift tax report, but be that as it may, she does admit that it was prepared by Mr. Gulick from information she had given him. She at first denied that she signed a report or that she took an affidavit thereto, or that it was executed in her home. I find the fact to be that this report was prepared by Mr. Gulick in his office, as well as the check for $12,788.81, and that he also prepared a letter under date of April 27th, 1936, advising complainant what to do with reference to the gift tax matter, and that he sent these papers to the home of complainant and that she executed them there; that the notary who took her affidavit to the report was a messenger from Mr. Gulick's office, and that when Mr. Gulick caused to be inserted on the second page of the report the number of shares of stock, the subject of the gift, and when he inserted the consideration for the gift as being "love and affection and to provide the husband with an independent income for his own uses and purposes," he did so because complainant, in her letter to him of the "25th inst." (referred to in the Gulick letter of April 27th to complainant) had given him that information. I am further satisfied that Mrs. Stewart understood what she was doing in this transaction.

"We have a finding, then, that on June 27th, 1935, the complainant knew full well that she had given her husband 4,172 shares of the Pritchard stock, as well as at the time of the signing of the gift tax report on April 27th, 1936, in which she distinctly says that the gift of these shares was not a fraud, as stated in her notice, but "love and affection," c.

"It will be observed that the parties had not separated at the time of the gift tax return and did not separate finally until the following June, and complainant distinctly testified that she was willing to pay the gift tax at the time she did because she thought her husband would do better.

"In view of these facts, it seems to me impossible to hold that there was any fraud practiced on complainant, either in the execution of the assignment of the 4,172 shares in June of 1935, or in the gift tax return of April, 1936, and that even had there been fraud committed in June of 1935, complainant was fully aware thereof when she executed the gift tax return in April of 1936, and that she executed the gift tax return and paid the gift tax with full knowledge of any alleged fraud; that she elected to stand by the gift and not insist on fraud under her notice of March 20th.

"Now then, it appears that in June of 1936 the parties separated, that in the latter part of May of that year, hostilities were at their height, and I have no doubt but that complainant started to rue the gift to her husband, but it would seem to me that the after events may not change this decision on the question as to what happened when the gift of 1935 was made. The couple were then in love and the gift was on that basis. The separation was in hate and what transpired thereafter was on that basis. I am not prepared to say whose fault it was that the separation occurred, nor am I called upon to do so.

"It is true that in July of 1936 complainant was deposed as vice-president of the corporation and thereafter deprived of $5,000 yearly salary. However, at that meeting complainant was represented by her own attorney, a Mr. Minturn of the New York bar, and at the stockholders' meeting he did not nominate Mrs. Stewart as a director, but he himself was nominated and elected as a director to represent Mrs. Stewart's stockholding interests. At the directors' meeting, Mr. Minturn nominated Mrs. Stewart as vice-president but she was not elected. The defendant says this was because he had been advised that the government would not permit her to draw a salary and not produce any work for the corporation, and that she, of course, could not be vice-president and not a director. But be all of this as it may, complainant could not be an `Indian giver' and the gift must stand, since she gave up all dominion over her stock. If the officers of the corporation mismanage the corporate affairs to her detriment she has her remedy by appropriate legal proceedings, but that they may have done so (I do not decide) at the July meeting of 1936 does not form a basis for the relief she seeks herein.

"The foregoing finding is against complainant's contention as set forth in her third amended bill, i.e., that the gift of the stock was procured by fraud, as stated in that pleading in paragraphs 14, 17 and 21-b, excerpts from which are as follows:

"Paragraph 14: `She was requested by the defendant to sign a paper which was stated to her to be a receipt or release for the 8,344 shares of stock owned by her that he was to deliver to her, and which said paper she signed with that understanding and belief.'

"Paragraph 17: `Complainant subsequently, to wit, on or about the 30th day of June, 1935, learned that the paper she had signed at the office of E. Pritchard, Inc., and which was represented to her as a Release or Receipt to be given for the 8,344 shares of stock to be delivered to her, was in fact an assignment of her said 8,344 shares of her said stock, and which her husband then fraudulently divided, issuing Certificate No. 124 to Complainant for only 4,172 shares of stock in E. Pritchard, Inc., and fraudulently issued to himself Certificate No. 123 for 4,172 shares of the Capital Stock of said Company.'

"Paragraph 21-b: `Shortly before this meeting, the defendant, Norman W. Stewart, without notice to Complainant, purchased 205 shares of the Capital Stock owned by Thomas N. O'Connell, thus making defendant's total stockholdings plus the shares held by Charles A. Peacock, a majority of the stock of E. Pritchard, Inc., and thus giving him voting control. All of which was a part of the plan to secure control of said Company away from Complainant, he having already fraudulently secured one-half of Complainant's stock.'

"Now then, I take it to have been the theory of counsel that the foregoing alleged fraudulent conduct of the defendant constituted the deception, undue influence, unfairness, coercion and concealment on the part of the defendant upon which the complainant's right to recovery depended, in view of the fact that no other acts of this character are alleged. My further understanding of the pleadings is that the original gift to the defendant of one share of stock for qualification as a director, defendant's election as president, the fixing of his salary at $15,000 and thereafter at $25,000, are historical recitals intended to build up the structure of fraud as alleged in the foregoing paragraphs of the third amended bill. It certainly may not be said from the evidence adduced that Mrs. Stewart did not at all times have a thorough knowledge of all this, no more than it may be said that it was not her own idea and insistment that all these steps should be taken by the directors of the corporation. It may well be that other stockholders than Mrs. Stewart should have objected, but they did not. All moves were unanimous until that wherein Mrs. Stewart was refused election as vice-president in July of 1936, after the separation. Even so, it is said that the court, having found the gift of the 4,172 shares of stock was voluntary and without actual or constructive fraud on the part of defendant, still this transaction `was not thoroughly understood by' complainant because defendant or no one else took the pains to actually say to the complainant before the transfer or assignment was made — if you transfer this stock it will be irrevocable and your husband may combine with the other stockholders and deprive you of your control of the corporation, and even without such a combination, the defendant will be able to out-vote you because he owns, by purchase from the O'Connell estate, 200 additional shares of stock. The answer to the last statement is that the defendant did not purchase the O'Connell shares until April of 1936, long after the assignment to the defendant was made. The answer to the first argument is that Mrs. Stewart well knew the stockholding set-up of the corporation, of which she had been vice-president since April of 1934, and also knew that the business of the corporation was conducted by its officers and directors, elected by its stockholders by a majority vote. Further, Mrs. Stewart filled in the assignment on the back of the certificate for 8,344 shares in her own handwriting and she testified that it was her custom to read before signing. She knew that the assignment read `irrevocable' when she signed it and she knew then that she certified in the gift tax return, executed 10 months thereafter, that the consideration for the gift was love and affection and that the purpose of the gift was to secure an independent income to her husband.

"Complainant also seeks to recover the amount of a certain joint bank deposit and testified positively that it was her money that went into the account and not that of her husband, and that she opened it by a transfer from her personal account to the joint account. The evidence of defendant and of the bank officials show that this is not so, but that all of the deposits were made by the defendant and that $1,400 thereof belonged to him and $208 to Mrs. Stewart, and that she withdrew from the joint bank account $225, and that the money withdrawn by defendant was used for household expenses.

"It thus appears that I cannot believe complainant's testimony, not only with reference to the joint bank account, but also with reference to the signature on the gift tax return and the proxy given to Knoeppel and the execution of the assignment of stock in June of 1935, and in this connection it might be well to call attention to that which, under ordinary circumstances, would have very little bearing on arriving at a conclusion as to the veracity of complainant but which, in connection with other testimony, does have some bearing. I refer to the fact that in the application for a marriage permit she swore that her age was 43 and when testifying on her direct examination she testified that she was then 65 years of age and thereafter testified that she was born in 1865. I can easily understand her reticence in giving her correct age to the marriage bureau and can understand her confusion as to the date she was born and her age when she was testifying, but I am also satisfied that she does not have a proper conception or appreciation of the solemnity of an oath and that her testimony demonstrates that situation.

"Mere suspicion that arises by reason of the disparity in the ages and fortunes of the parties litigant and the rapidity with which defendant became possessed of the Pritchard Company stock and the increase of his earning ability from a $40 a week employe to a $25,000 a year president will not justify a decree in this case in view of the circumstances connected with it. All of these things happened because complainant wanted them to happen and continued with her full knowledge and would have continued had defendant been more diplomatic in his treatment of complainant, but the mere fact that a subsequent irreparable breach occurred, wherein complainant lost what she had paid for, to wit, the love or affection or companionship of a bought-and-paid-for man, standing alone, does not justify a decree.

"The happenings after the irreparable breach, while explainable, do not reflect any credit on the defendant. The most glaring action on the part of the defendant, and that which is dwelt upon by the complainant is that in July of 1936 at a directors' meeting held in that month, complainant was not re-elected as either a director or vice-president and that she lost or was deprived of the $5,000 yearly salary which she theretofore drew. The explanation is that she had not been elected a director at the stockholders' meeting and that she could not, therefore, be elected as vice-president, and that defendant had been advised that taxing difficulties would ensue if a salary of $5,000 were paid to complainant, who admittedly rendered no service therefor to the corporation. Be that as it may, a perusal of the minutes of the stockholders' meeting show that Mr. Minturn appeared for complainant and voted for all of the directors nominated, as well as for the salaries allowed to each officer, including the $25,000 salary to the defendant.

"I have not adverted to the testimony of Mr. and Mrs. Kamm as to conversations in which Mrs. Stewart told them of her intentionally having given one-half of her stock to the defendant, not because their testimony is not believed by the court, but because a decision must be reached without resort thereto, nor have I commented on my disbelief of Mr. Murphy's testimony, because it clearly appears that Mrs. Stewart did not sign the assignment at the office and hence his version of what he says were the happenings cannot be believed, nor do I believe that prior to the marriage defendant would have been so unwise as to say to him that he was going to marry a fat old woman because `he wanted to keep her in the lodge.'

"There may be no doubt of Mrs. Stewart's affection for the Kamms. Her letter to Mrs. Kamm demonstrates that fact and it is not at all unreasonable that Mrs. Stewart should have told these friends of her gift of stock to the defendant.

"A decree dismissing the bill of complaint will be advised."

Mr. Philip L. Lipman and Mr. LeRoy W. Loder, for the complainant-appellant.

Mr. Albert R. McAllister and Mr. David L. Horuvitz, for the defendants-respondents.

The decree under review will be affirmed, for the reasons expressed in the opinion of Vice-Chancellor Sooy.


For reversal — None.