In re the Estate of Smith

3 Mills Surr. 485, 40 Misc. 331, 81 N.Y.S. 1035
CourtNew York Surrogate's Court
DecidedMarch 15, 1903
StatusPublished

This text of 3 Mills Surr. 485 (In re the Estate of Smith) is published on Counsel Stack Legal Research, covering New York Surrogate's Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re the Estate of Smith, 3 Mills Surr. 485, 40 Misc. 331, 81 N.Y.S. 1035 (N.Y. Super. Ct. 1903).

Opinion

Thomas, S.

The proceeding to settle the accounts of the administratrix was first commenced, and an order of reference was made to Mr. John A. Foley, as referee. It became quite apparent to the parties that no final adjudication upon the rights of persons interested in the fund could be made without an account also being had by the administrator. Thereupon, without any order of a surrogate, but on the agreement of the parties, the account of the administrator was filed with the referee; objections were also filed with him, a stipulation was made that the two accountings be consolidated, andi evidence was taken, with the acquiescence of all concerned, as if there was one consolidated [486]*486proceeding which included both accounts. At the end of the hearing the referee suggested that this method of procedure might be irregular, and a due formal proceeding for the accounting by the administrator was therefore commenced ;• objections were filed, and an order of reference to the same referee was made, on the motion of the attorney for the administrator, which included a provision that the testimony already taken stand as the testimony of the parties to said accounting.”

The brief submitted to me by the attorney for the administrator on the argument of this application to confirm the report of the referee is a copy of the brief submitted by him to the referee, and is entitled, In the matter of the judicial settlement" of the accounts of Ellen M. Smith and John P. Smith as coadministrators of the estate of Patrick J. Smith, deceased.” Ro request is to be found in the document to treat the two proceedings separately. The referee made one report entitled in both proceedings, but carefully separated the findings on issues of fact raised in each of them. There is not the slightest confusion and, if justice required, two reports could easily be made of the one without any material change.

In the face of these facts the first objection of the administrator is that there should be two reports. The method pursued by the referee was in conformity with the stipulation and understanding of the parties; he has duly reported on every issue raised in each of the proceedings, and I decline to set aside his whole report because he has embodied his conclusions in one document rather than in two.

It is quite obvious that the two proceedings should end in a single decree- in order to avoid great confusion. I will, therefore, pursuant to section 2727 of the Code of Civil Procedure, and on my own motion, order that the proceedings be consolidated.

The referee recommends a decree that the entire assets of the estate in the hands of the administrator be paid over by him to the administratrix, to be' by her distributed among the persons [487]*487•entitled. Such a provision would tend towards simplicity in the terms of the decree, and possibly make its method of enforcement •clearer, but it would amount to a removal of the administrator in á proceeding brought for an entirely different purpose, in which no prayer for his removal is to be found, and without adequate cause for such removal. The exceptions pointed to this recommendation must be sustained, and the decree for final disr tribution must direct payment by both administrators, out of the assets in their hands, to the persons ultimately entitled.

The savings bank deposits made by and in the name of Ellen M. Smith, now the widow and administratrix, in trust for Patrick J. Smith,” were of her own money; she retained the bankbook at all times, and since the death of her husband she has withdrawn the money and used part of it for her support. There is no evidence that she ever informed her husband of the account or that he had any knowledge of it. Mrs. Smith testified that, at the time of opening the account and of making the deposits, it was her intent that her husband should have the money only if he survived her. On these facts her title to the money is sustained by the referee and is challenged by the administrator.

If Mrs. Smith had died before her husband, leaving the account open and unexplained, the form in which the deposit was made would have raised a presumption of an intent on her part to bind the money by a trust in his favor and, in the absence of evidence to the contrary, such trust would have been deemed established as an irrevocable transfer of an interest to him. Martin v. Funk, 75 N. Y. 134; Willis v. Smyth, 91 id. 297; Grafing v. Heilmann, 1 App. Div. 260, aff’d 153 N. Y. 673; Decker v. Union Dime Savings Inst., 15 App. Div. 553; Williams v. Brooklyn Savings Bank, 61 id. 332; Harrison v. Totten, 53 id. 178; Robertson v. McCarty, 54 id. 103; Scallan v. Brooks, id. 248; Meislahn v. Meislahn, 56 id. 566; Hyde v. Kitchen, 69 Hun, 280 Millard v. Clark, 80 id. 141; Matter of Biggars, 39 Misc. Rep. 426. The presumption of intent to create a trust [488]*488would suffice to establish a prima facie case, but it would be subject to contradiction by proof of surrounding circumstances, or of the acts and declarations of the depositor forming part of the res gestae, or declarations of the beneficiary against his interest, tending to show that, at the time of the deposit, such interest did not exist. Washington v. Bank for Savings, 171 N. Y. 166, aff'g 65 App. Div. 338, the beneficiary was fictitious; Matter of Mueller, 15 App. Div. 67, declarations of beneficiary against interest; Decker v. Union Dime Savings Inst., id. 553; Meislahn v. Meislahn, 56 id. 566. The drafts made by Mrs. Smith would, in such a case, have been regarded not as evidence bearing on the intent with which the money was deposited, but as showing a change of purpose and an intent to convert the property of another to her own use, and her personal representatives would be required to restore the money. Mabie v. Bailey, 95 N. Y. 206, some proof of affirmative declarations in this case; Farleigh v. Cadman, 159 N. Y. 169, modifying 11 App. Div. 628, the evidence of intent was clear and the findings of fact were binding upon the court; Robertson v. McCarty, 54 App. Div. 103; Robinson v. Appleby, 69 id. 509; Hutton v. Smith, 74 id. 284; there were explicit declarations of the depositor showing the intent in making the deposit.

In each and every of the cases above cited the depositor died before the beneficiary, and the controversy arose between the beneficiary, or his legal representative, and the legal representative of the depositor. In at least two cases it was determined that the presumption from the continued possession of the passbook by the depositor, with its attendant power of control, was that the trust period terminated only with the life of the depositor, and that no right of action accrued to the beneficiary until the death of the depositor. Mabie v. Bailey, 95 N. Y. 206, 212; Hutton v. Smith, 74 App. Div. 284, 291.

After a careful search I have been able to find only three cases in which it has been attempted to require the person making such [489]*489a deposit to recognize in bis lifetime a right in such beneficiary. In Cunningham v. Davenport, 147 N. Y. 43, a deposit was made of his own money by one brother in trust for another; the passbook was kept by the depositor; the beneficiary died and the depositor withdrew the fund and converted it to his own use. In an action brought against the depositor by the legal representative of the beneficiary to recover the money, the depositor testified that, in making the deposit he did not intend to benefit his brother or his brother’s representatives.

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Related

Martin v. . Funk
75 N.Y. 134 (New York Court of Appeals, 1878)
Farleigh v. . Cadman
53 N.E. 808 (New York Court of Appeals, 1899)
Mabie v. . Bailey
95 N.Y. 206 (New York Court of Appeals, 1884)
Washington v. . Bank for Savings
63 N.E. 831 (New York Court of Appeals, 1902)
Cunningham v. . Davenport
41 N.E. 412 (New York Court of Appeals, 1895)
Grafing v. Heilmann
1 A.D. 260 (Appellate Division of the Supreme Court of New York, 1896)
Haux v. Dry Dock Savings Institution
2 A.D. 165 (Appellate Division of the Supreme Court of New York, 1896)
In re the Judicial Settlement of the Account of Mueller
15 A.D. 67 (Appellate Division of the Supreme Court of New York, 1897)
Decker v. Union Dime Savings Institution
15 A.D. 553 (Appellate Division of the Supreme Court of New York, 1897)
Robertson v. McCarty
54 A.D. 103 (Appellate Division of the Supreme Court of New York, 1900)
Washington v. Bank for Savings
65 A.D. 338 (Appellate Division of the Supreme Court of New York, 1901)
Hutton v. Smith
74 A.D. 284 (Appellate Division of the Supreme Court of New York, 1902)
Lee v. Kennedy
25 Misc. 140 (Appellate Terms of the Supreme Court of New York, 1898)
Weber v. Weber
58 How. Pr. 255 (New York Supreme Court, 1879)
Hyde v. Kitchen
23 N.Y.S. 573 (New York Supreme Court, 1893)
In re the Final Accounting of Biggars
3 Mills Surr. 341 (New York Surrogate's Court, 1902)

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Bluebook (online)
3 Mills Surr. 485, 40 Misc. 331, 81 N.Y.S. 1035, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-the-estate-of-smith-nysurct-1903.