German Savings Bank

This case is not covered by Casetext's citator
Supreme Court, Appellate TermJun 1, 1897
20 Misc. 571 (N.Y. Misc. 1897)
20 Misc. 57146 N.Y.S. 422

June, 1897.

Frederick W. Holls, and Holls, Wagner Burghard, for appellant.

A.H. Parkhurst and Browne Sheehan, for respondent.


The right of the plaintiff to recover depends upon the written instrument which was delivered to her at the time that the bank or pass-book was also delivered, since her title to the moneys on deposit is derived solely from the writing in question. The evidence in the case shows that the depositor Bohm was very ill and did not expect to live and died two or three days after the delivery of the paper and book to the plaintiff; that he wanted to go down to the bank to draw his money, but he was either too sick, or it was raining, and the plaintiff would not allow him to go and draw the money; that the doctor brought an attorney and Bohm "wanted to put it in black and white," and that he delivered the book and paper to the plaintiff in the presence of the doctor and the attorney. The complaint does not allege a gift causa mortis, but a power of attorney and a trust deed. So far as the power of attorney is concerned, the appellant successfully assailed any right in plaintiff by virtue thereof, since such a power is necessarily revoked by the death of the party executing it and before any attempt is made to act under it.

The complaint describes the instrument under which the plaintiff claims as a trust deed, as well as a power of attorney, and, if a trust was thereby created, the form of the instrument may be disregarded, and the fact that a power of attorney was contained in it will not affect the validity of the trust. The attorney who was called in to draw the paper used, as a vehicle for recording the wishes of his client, a form of power of attorney, but that fact will not defeat the intention of the deceased, if his purpose to create a valid trust is plainly apparent from the writing. Such intention in this case is clearly expressed and should be carried out if possible. As it is a trust of personal property, it could be created without a writing and, as the appellant concedes, it is competent and proper to take into consideration the surrounding facts and circumstances evidencing the motive and intent of the testator.

The contention of appellant is that the instrument is ineffectual as a trust deed, because it negatives the idea of a present vesting of title in the plaintiff, which is the first essential requisite in the creation of a trust. But the basis of this argument is the inconsistency between a power of attorney and a trust; since in the former case the principal retains the title, conferring only the power of disposition upon another as his agent; while "to create a trust it is necessary that there should be an intention on the part of the donor to part with all interest in the subject of the trust, and to vest the title in another by some act sufficient to pass the title. The question of intent controls." Markey v. Markey, 13 N.Y.S. 925. If, however, the form of the instrument, namely, that of a power of attorney, is purely accidental, it will not affect a trust, otherwise clearly expressed in it. If the intention of the donor is to create a trust and that is clearly apparent, such intention will control, instead of the mere matter of form.

It might, at first sight, seem that there was no intention to vest title in the donee, since this instrument was certainly made in contemplation of death and with the same reservation of power to revoke it as exists in the case of gifts causa mortis. That is to say, had Bohm recovered from the illness under which he was suffering at the time that he executed this instrument and attempted to recover his pass-book and other property mentioned in the paper from the plaintiff, he would have had the undoubted right to do so, and any attempt of the plaintiff to retain them against his wishes would have received no support from the courts.

But this view of the intention of the donor is not inconsistent with the creation of a valid trust. Valid trusts may be created, revocable at the pleasure of the settlor. 27 Am. Eng. Ency. of Law, 310. The instrument in question might have provided for a revesting of the property in Bohm in case of his recovery, and, notwithstanding, the title would have passed, subject to such a contingency. The circumstances under which the paper was executed imply the reservation of a power of revocation and, while this protects amply the rights of a person in the condition of the deceased, it does not affect the validity of the disposition which he clearly intended to make and which was to take effect immediately, subject only to the contingency named.

I assume that, notwithstanding this instrument became operative by its terms and by delivery so as to pass the property described in it to the trustee, yet, under the circumstances of the case, being executed in expectation of death and with regard to that contingency only, the donor or settlor of the trust would be entitled, in case of his recovery, to be reinvested with the property, for a right in the nature of a power of revocation in that contingency is to be inferred from the circumstances under which the paper was delivered. But, apart from the effect of the ultimate recovery of the settlor from his illness, there was an absolute and irrevocable trust created by the delivery of the deed. In the cases cited by the appellant (Fisher v. Hall, 41 N.Y. 416, and Bryant v. Bryant, 42 id. 11), the deeds of property were held to be inoperative for want of a delivery so as to pass a present title. No such difficulty exists in this case, the delivery having been established. In Meiggs v. Meiggs, 15 Hun, 453, also cited by appellant, it was held that no valid trust was established for want of a complete and valid delivery of the subject and because of the evidence of an intention not to place the property irrevocably beyond the donor's control; the bonds which were delivered as a provision for the donor's children, in the event of financial disaster of the donor, being deposited subject to the latter's right to withdraw them.

In the case before us, there was complete and explicit provision made by an instrument in writing for the disposition of the property by the trustee, a delivery of the instrument and delivery of the bank-book, without which a demand upon the bank would have been ineffectual, and, therefore, with the plain intent to put the trustee in possession of the fund. I can see no objection to effectuating the will of the donor under these circumstances. I do not see why the donor, having the power to make a valid gift in expectation of death, could not provide, by the means he adopted, for a distribution of his personal property among several donees by the creation of a trust for that purpose.

The judgment should be affirmed, with costs.

McADAM and BISCHOFF, JJ., concur.

Judgment affirmed, with costs.

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