Summary
In Bunt, supra, the husband, without his wife's knowledge, withdrew funds from their joint checking account and purchased stock with it. He had the stock issued in joint tenancy between himself and his daughter, and he also retained possession of the stock certificate.
Summary of this case from Matter of Estate of FiksdalOpinion
File No. 10198.
Opinion filed March 26, 1965
1. Husband and Wife.
Husband as joint owner of bank account had legal right to make withdrawal within balance without liability to wife, the other joint tenant. SDC 1960 Supp. 6.0414.
2. Gifts.
Essential elements of inter vivos gifts include intention, delivery and acceptance.
3. Gifts.
Deceased by having stock certificate issued to himself and his daughter as "Jt Wr of Surv not as Tenants in Common" made gift of joint tenant interest to daughter even though certificate never was physically delivered to daughter and deceased had retained the dividends during his lifetime. SDC 1960 Supp. 51.0212; SDC 51.1506.
4. Gifts.
Delivery of gift may be either actual or constructive, depending upon circumstances under which gift is made.
5. Joint Tenancy.
Since possession of joint tenants is in common and each has right to enjoyment of whole property to extent of his interest, if only one of them holds property, he must be considered as possessing, not only for himself, but also for benefit of his cotenant, although there is no contract between them.
6. Gifts.
Acceptance of gift is presumed in absence of renunciation and any condition to be performed by donee, especially where gift is from parent to child and it operates entirely to donee's benefit.
7. Corporations.
Father's gift of shares of stock to daughter by procuring issuance of stock certificate to himself and daughter as "Jt Wr of Surv not as Tenants in Common" did not involve stock transfer from donor to donee and provisions of uniform stock transfer law were not applicable. SDC 11.0501(1).
Appeal from Circuit Court, Minnehaha County; Hon. Roy D. Burns, Judge.
Action by a widow against her daughter to quiet title in herself to certain shares of stock and dividends issued thereon. From a judgment in favor of the daughter, the widow appeals.
Affirmed.
T.R. Johnson, Danforth, Danforth Johnson, Sioux Falls, for plaintiff and appellant.
Miller, Kaye Hanson, Mitchell, for executor. Woods, Fuller, Shultz Smith, Sioux Falls, for defendant and respondent, Marlys Bunt Fairbanks.
Rachel H. Bunt, the widow of Richard H. Bunt, deceased, and the mother of the defendant Marlys G. Fairbanks, seeks in this action to quiet title in herself to one thousand shares of National Securities Series stock and the dividends issued thereon. The defendant Fairbanks denies plaintiff has any interest in such personal property, and by counterclaim demands judgment for possession of the securities, and for the amount of dividends and distributions received by plaintiff from such stock. After the action was commenced Theodore G. Bunt, as executor of the will of Richard H. Bunt, was made a party defendant. The court decided the issues in favor of the daughter. Plaintiff appeals.
Before and during 1960 plaintiff and her husband Richard H. Bunt had a joint checking account in the Northwestern National Bank at Sioux Falls. Plaintiff claims to have contributed upwards of $3,500 of her separate funds to this account. On October 28, 1960 the deceased, without plaintiff's knowledge, withdrew $8,000 for the purchase of the stock involved. Immediately before this withdrawal the balance in the account was $11,699.46. The stock certificate was issued to "Richard H. Bunt Marlys Fairbanks as Jt Wr of Surv not as Tenants in Common", and was never physically delivered to defendant. Until his death Mr. Bunt received and retained the dividends therefrom. Appellant questions the right of her late husband to withdraw the $8,000.
The joint bank account apparently was for the convenience and benefit of both Mr. and Mrs. Bunt. Their deposits therein established a creditor debtor contract relationship with the bank. Barbour v. First Citizens National Bank of Watertown, 77 S.D. 106, 86 N.W.2d 526. The bank could by statute, SDC 1960 Supp. 6.0414, and had the duty by contract, to honor such checks as were drawn upon the account by either co-owner so long as the balance was sufficient and not subject to a prior lien or claim. Flaherty v. Bank of Kimball, 75 S.D. 468, 68 N.W.2d 105. At the time the $8,000 check was issued Mr. Bunt was the real owner of the account in at least that amount, and as between the joint owners had the legal right to make the withdrawal without liability to the other. 161 A.L.R. 71.
Appellant next contends the stock purchase was not a valid gift inter vivos. The essential elements of a gift inter vivos include intention, delivery and acceptance. 24 Am.Jur., Gifts, § 21 to § 42.
Counsel for appellant stressed in argument that the evidence and findings are wanting as to donative intent. The second finding of fact adopted by the trial court reads: "By such purchase, issuance and delivery, the said Richard H. Bunt intended to and did make a gift of such interest as a joint tenant to the said Marlys G. Fairbanks". In our opinion the finding is adequate and is supported by evidence.
A gift is without consideration, SDC 51.1506, and for that reason fails as a contract until executed. Delivery is the adrenaline that makes it a contract executed. O'Gorman v. Jolley, 34 S.D. 26, 147 N.W. 78. In re Lower's Estate, 48 S.D. 173, 203 N.W. 312.
That this stock certificate was issued to joint tenants is a distinguishing fact. Our joint tenancy statute, as amended, SDC 1960 Supp. 51.0212, reads in part: "A joint tenancy interest is one owned by several persons in equal shares, by a title created by a single * * * transfer, when expressly declared in the * * * transfer to be a joint tenancy, * * *. Any * * * transfer * * * of * * * personal property to two or more grantees, * * * which, by the method of describing such grantees or by the language of the granting habendum clause therein evinces an intent to create a joint tenancy in grantees shall be held and construed to create such joint tenancy." In South Dakota survivorship is an established incident of a joint tenancy. Armstrong v. Hellwig, 70 S.D. 406, 18 N.W.2d 284. In re Hanson's Estate, 77 S.D. 474, 93 N.W.2d 606.
Although donor retained possession of the certificate, he surrendered his exclusive dominion and control thereof when he had ownership placed in defendant and himself. Nothing more remained to be done to make the gift complete and absolute. It was irrevocable. Each co-owner had an equal right to possession of the certificate and since they could not both have manual possession at the same time, possession by one cotenant is, in contemplation of law, possession for both. Frey v. Wubbena, 26 Ill.2d 62, 185 N.E.2d 850; Allender v. Allender, 199 Md. 541, 87 A.2d 608; Marans v. Newland, 141 Mont. 32, 374 P.2d 721; Eisenhardt v. Lowell, 105 Colo. 417, 98 P.2d 1001; Young v. Cockman, 182 Md. 246, 34 A.2d 428, 149 A.L.R. 1006; Zander v. Holly, 1 Wis.2d 300, 84 N.W.2d 87; Crowell v. Milligan, 157 Neb. 127, 59 N.W.2d 346; Manning v. United States National Bank of Portland, 174 Or. 118, 148 P.2d 255, 153 A.L.R. 922.
[4, 5] The delivery of a gift may be either actual or constructive, depending upon the circumstances under which the gift is made. The impossibility of both joint tenants holding possession at the same time made a constructive delivery according to the manner in which this particular stock certificate was susceptible of being delivered sufficient. Steffen v. Davis, 52 S.D. 283, 217 N.W. 221; 24 Am.Jur., Gifts, § 27. Since the possession of joint tenants is in common and each has the right to the enjoyment of the whole property to the extent of his interest, if only one of them holds the property, he must be considered as possessing, not only for himself, but also for the benefit of his cotenant, although there is no contract between them. 48 C.J.S. Joint Tenancy § 7. Retention of the dividends by deceased under these circumstances did not invalidate the gift. Benton v. Smith et al., Mo. App., 171 S.W.2d 767; Allender v. Allender, supra.
Regarding the element of acceptance, it appears to be the rule that, in the absence of renunciation, acceptance of a gift will be presumed when it is unaccompanied by any condition to be performed by the donee, especially where the gift is from parent to child and it operates entirely to the donee's benefit. 24 Am.Jur., Gifts, § 117; Phillips v. Plastridge, 107 Vt. 267, 179 A. 157, 99 A.L.R. 1074.
We do not regard the provisions of the Uniform Stock Transfer Law, SDC 11.0501(1), applicable. This gift did not involve a stock transfer from the donor to donee.
The judgment is affirmed.
RENTTO, HANSON, BIEGELMEIER and HOMEYER, JJ., concur.
FOSHEIM, Circuit Judge, sitting for ROBERTS, P.J., disqualified.