MooRE, J.
It is stipulated by all parties that the United States Savings Bonds, Series G, here involved, were issued under and subject to the Code of Federal Regulations, Cumulative Supplement, Book 6, 1944, Title 31, Chapter II, Part 315, Sub-part K, s. 315.32. The effect of these regulations in relation to the title and ownership of such and similar bonds has been the subject of discussion and decision in a number of cases in this jurisdiction.
Tanner v. Ervin,
250 N.C. 602, 109 S.E. 2d 460;
Wright v. McMullan
and
Wright v. Wright,
249 N.C. 591, 107 S.E. 2d 98;
Jones v. Callahan,
242 N.C. 566, 89 S.E. 2d 111;
Watkins v. Shaw,
234 N.C. 96, 65 S.E. 2d 881;
Ervin v. Conn
and
Bank v. Frederickson,
225 N.C. 267, 34 S.E. 2d 402. In the opinions in these cases the decisions in this and other jurisdictions are cited and discussed and explanations of the principles applied are fully set out. Explanative and extended discussion of the subject would be unnecessarily repetitious in the instant case. Here we merely summarize the applicable and controlling principles already established.
“United States Savings Bonds are not transferable and are payable only to the owners named thereon .... Accordingly, savings bonds may not be sold or hypothecated as collateral for a loan and may not be used as security for the performance of an obligation. . . .” Fed. Regs., Title 31, C. II, Part 315, Sub-part C, s. 315.8.
“The regulations by clear and unmistakable language fix ownership by the form of registration. These bonds could not be the subject of a gift
inter vivos
or
causa mortis.
State laws fixing the requirements for a valid gift have no application to these bonds.”
Wright v. McMullan
and
Wright v. Wright, supra.
Section 315.32 of the above Regulations provides: “A savings bond registered in the names of two persons as coowners in the form ‘John A. Jones or Mrs. Mary C. Jones,’ will be paid or reissued as follows: (a) .... (b)
After the death of one coowner.
If either coowner dies without having presented and surrendered the bond for payment . . . the surviving coowner will be recognized as the sole and absolute owner of the bond, and payment will be made only to him.”
“The rule followed by a majority of the Courts, including North Carolina, frequently called the ‘majority rule,’ with respect to rights in United States Savings Bonds registered ... in the name of two individual co-owners in the alternative, is that, upon the death of one of the co-owners, the surviving co-owner is vested with the sole ownership in such bonds, at least in the absence of fraud or other inequitable conduct on the part of the survivor.”
Tanner v. Ervin, supra.
“The principal basis of the majority view is that solution of the question as to the property rights of the surviving co-owner in a . . . Bond is one of contract, and that the Treasury Regulations having the force and effect of federal law, become a part of the bond as a contract between the purchaser and the federal government, and fix legal title to the bond, and are determinative of the property rights of the parties to the bond.”
ibid.
Accord:
Ervin v. Conn
and
Bank v. Frederickson, supra,
at page 274.
Where a co-owner dies testate, the title to the bond passes not by virtue of anything contained in the will, but by right of survivorship under the terms of the bond itself.
Jones v. Callahan, supra.
Where a husband and wife purchased United States Savings Bonds with money owned jointly by them, the bonds being issued in their names in the alternative, and they thereafter entered into a separation agreement in which it was provided that the husband should have and own the bonds, he having given valuable consideration therefor and having failed to present the bonds for payment during his lifetime, this Court held that the proceeds of the bonds were impressed
with a resulting trust in favor of the husband’s executor by reason of the separation agreement and the unjust enrichment of the wife should she be permitted to retain the proceeds.
Tanner v. Ervin, supra.
In the case at bar defendants Wilder contend that, as evidenced by letter attached to the bonds, H. C. Cameron paid to Margaret C. Tempest $10,000.00, in consideration of which Margaret C. Tempest surrendered and conveyed to Cameron all beneficial interest in the bonds and now has only the bare right to present the bonds for payment and to collect the principal and interest, and must hold the proceeds in trust for the person entitled to the beneficial interest. They contend further that the beneficial interest passed to Ruth Wilder Cameron under the will of H. C. Cameron.
The decisive question in this case is: What weight and effect must be given by the court to the letter which was attached to the bonds by H. C. Cameron? The court below gave it no effect and thereby eliminated the crucial evidence upon which the claim of defendants Wilder depends.
The letter was included in the stipulations of counsel. Had it been offered in evidence upon trial, its admission, over objection, would have been error. It is hearsay evidence. The fact that it was admitted by stipulation does not require the judge to give it legal effect, although exceptions to a judgment on the ground that it is based on incompetent evidence have been held untenable when the evidence is admitted without objection.
Poole v. Gentry,
229 N.C. 266, 269, 49 S.E. 2d 464. However, “in reviewing a trial before the court without a jury it will be presumed that incompetent evidence was disregarded and the issue determined only from a consideration of competent evidence . . . .”
Bizzell v. Bizzell,
247 N.C. 590, 605, 101 S.E. 2d 668. There is no rule requiring a judge, in a case in which the facts are agreed and stipulated, to give effect to incompetent evidence, though not objected to, if there is sufficient competent evidence to support a judgment.
The self-serving declarations of a deceased, whether oral or written, are ordinarily considered to be hearsay and inadmissible in evidence. “There is a general rule that self-serving declarations, defined as statements favorable to the interest of the declarant, are not admissible in evidence as proof of the facts asserted, whether they arose by implication from acts and conduct or were made orally or reduced to writing. The vital objection to the admission of this kind of evidence is its hearsay character.” 20 Am. Jur., Evidence, s. 558, pp. 470, 471. “. . . (I) t has been held that self-serving declarations, although admitted without objection, are without probative value.” 88 C.J.S., Trial, s. 152, p. 298.
Fredenburg v. Horn,
218 P. 939, 30
A.L.R. 1153 (Ore. 1923), was an action to recover damages for alleged conversion of estate property by the executor. In reference to an exception to the exclusion of evidence, the Court said: “It is alleged that the Court erred in sustaining the objections made to testimony as to declarations of the deceased that he was the owner of the property. . . .
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MooRE, J.
It is stipulated by all parties that the United States Savings Bonds, Series G, here involved, were issued under and subject to the Code of Federal Regulations, Cumulative Supplement, Book 6, 1944, Title 31, Chapter II, Part 315, Sub-part K, s. 315.32. The effect of these regulations in relation to the title and ownership of such and similar bonds has been the subject of discussion and decision in a number of cases in this jurisdiction.
Tanner v. Ervin,
250 N.C. 602, 109 S.E. 2d 460;
Wright v. McMullan
and
Wright v. Wright,
249 N.C. 591, 107 S.E. 2d 98;
Jones v. Callahan,
242 N.C. 566, 89 S.E. 2d 111;
Watkins v. Shaw,
234 N.C. 96, 65 S.E. 2d 881;
Ervin v. Conn
and
Bank v. Frederickson,
225 N.C. 267, 34 S.E. 2d 402. In the opinions in these cases the decisions in this and other jurisdictions are cited and discussed and explanations of the principles applied are fully set out. Explanative and extended discussion of the subject would be unnecessarily repetitious in the instant case. Here we merely summarize the applicable and controlling principles already established.
“United States Savings Bonds are not transferable and are payable only to the owners named thereon .... Accordingly, savings bonds may not be sold or hypothecated as collateral for a loan and may not be used as security for the performance of an obligation. . . .” Fed. Regs., Title 31, C. II, Part 315, Sub-part C, s. 315.8.
“The regulations by clear and unmistakable language fix ownership by the form of registration. These bonds could not be the subject of a gift
inter vivos
or
causa mortis.
State laws fixing the requirements for a valid gift have no application to these bonds.”
Wright v. McMullan
and
Wright v. Wright, supra.
Section 315.32 of the above Regulations provides: “A savings bond registered in the names of two persons as coowners in the form ‘John A. Jones or Mrs. Mary C. Jones,’ will be paid or reissued as follows: (a) .... (b)
After the death of one coowner.
If either coowner dies without having presented and surrendered the bond for payment . . . the surviving coowner will be recognized as the sole and absolute owner of the bond, and payment will be made only to him.”
“The rule followed by a majority of the Courts, including North Carolina, frequently called the ‘majority rule,’ with respect to rights in United States Savings Bonds registered ... in the name of two individual co-owners in the alternative, is that, upon the death of one of the co-owners, the surviving co-owner is vested with the sole ownership in such bonds, at least in the absence of fraud or other inequitable conduct on the part of the survivor.”
Tanner v. Ervin, supra.
“The principal basis of the majority view is that solution of the question as to the property rights of the surviving co-owner in a . . . Bond is one of contract, and that the Treasury Regulations having the force and effect of federal law, become a part of the bond as a contract between the purchaser and the federal government, and fix legal title to the bond, and are determinative of the property rights of the parties to the bond.”
ibid.
Accord:
Ervin v. Conn
and
Bank v. Frederickson, supra,
at page 274.
Where a co-owner dies testate, the title to the bond passes not by virtue of anything contained in the will, but by right of survivorship under the terms of the bond itself.
Jones v. Callahan, supra.
Where a husband and wife purchased United States Savings Bonds with money owned jointly by them, the bonds being issued in their names in the alternative, and they thereafter entered into a separation agreement in which it was provided that the husband should have and own the bonds, he having given valuable consideration therefor and having failed to present the bonds for payment during his lifetime, this Court held that the proceeds of the bonds were impressed
with a resulting trust in favor of the husband’s executor by reason of the separation agreement and the unjust enrichment of the wife should she be permitted to retain the proceeds.
Tanner v. Ervin, supra.
In the case at bar defendants Wilder contend that, as evidenced by letter attached to the bonds, H. C. Cameron paid to Margaret C. Tempest $10,000.00, in consideration of which Margaret C. Tempest surrendered and conveyed to Cameron all beneficial interest in the bonds and now has only the bare right to present the bonds for payment and to collect the principal and interest, and must hold the proceeds in trust for the person entitled to the beneficial interest. They contend further that the beneficial interest passed to Ruth Wilder Cameron under the will of H. C. Cameron.
The decisive question in this case is: What weight and effect must be given by the court to the letter which was attached to the bonds by H. C. Cameron? The court below gave it no effect and thereby eliminated the crucial evidence upon which the claim of defendants Wilder depends.
The letter was included in the stipulations of counsel. Had it been offered in evidence upon trial, its admission, over objection, would have been error. It is hearsay evidence. The fact that it was admitted by stipulation does not require the judge to give it legal effect, although exceptions to a judgment on the ground that it is based on incompetent evidence have been held untenable when the evidence is admitted without objection.
Poole v. Gentry,
229 N.C. 266, 269, 49 S.E. 2d 464. However, “in reviewing a trial before the court without a jury it will be presumed that incompetent evidence was disregarded and the issue determined only from a consideration of competent evidence . . . .”
Bizzell v. Bizzell,
247 N.C. 590, 605, 101 S.E. 2d 668. There is no rule requiring a judge, in a case in which the facts are agreed and stipulated, to give effect to incompetent evidence, though not objected to, if there is sufficient competent evidence to support a judgment.
The self-serving declarations of a deceased, whether oral or written, are ordinarily considered to be hearsay and inadmissible in evidence. “There is a general rule that self-serving declarations, defined as statements favorable to the interest of the declarant, are not admissible in evidence as proof of the facts asserted, whether they arose by implication from acts and conduct or were made orally or reduced to writing. The vital objection to the admission of this kind of evidence is its hearsay character.” 20 Am. Jur., Evidence, s. 558, pp. 470, 471. “. . . (I) t has been held that self-serving declarations, although admitted without objection, are without probative value.” 88 C.J.S., Trial, s. 152, p. 298.
Fredenburg v. Horn,
218 P. 939, 30
A.L.R. 1153 (Ore. 1923), was an action to recover damages for alleged conversion of estate property by the executor. In reference to an exception to the exclusion of evidence, the Court said: “It is alleged that the Court erred in sustaining the objections made to testimony as to declarations of the deceased that he was the owner of the property. . . . (T)hey were purely self-serving, if made at all.”
We do not seek to alter the hearsay rule so as to make the incompetency of self-serving declarations more extensive than heretofore in this jurisdiction, and we quote with approval the following statement: “Hearsay statements are sometimes excluded on the ground that they are ‘self-serving.’ This phrase is often useful as emphasizing the inapplicability of some hearsay exception or as suggesting a reason for the rigid enforcement of the hearsay rule in the particular case, but it does not describe an independent ground of objection. If the statement is hearsay, and is not admissible under some specific rule, it is subject to exclusion regardless of whether it is self-serving, neutral, or self-disserving.” Stansbury: North Carolina Evidence, s. 140, p. 280.
We think the unsupported
ex parte
statement of deceased H. C. Cameron, that he had purchased the bonds from Margaret and that they belonged to him and Mrs. Cameron, was incompetent and the court was justified in disregarding it. It does not come within an exception to the hearsay rule. Stansbury: North Carolina Evidence, s. 147, p. 300.
It is our opinion and we hold that Margaret C. Tempest has title to and owns the bonds in controversy.
Wright v. McMullan
and
Wright v. Wright, supra.
Defendant Tempest admits, in answering paragraph 5 of the complaint, that she obtained a “no interest loan” of $10,000.00 from H. C. Cameron and is indebted to his estate in this amount. She further admits that she delivered the bonds to him as security for the loan.
It is unnecessary to decide whether or not the transaction alleged by plaintiff and admitted by defendant Tempest created an equitable lien in favor of the estate of H. C. Cameron against the proceeds of the bonds. Defendant Tempest consented to the judgment entered by the court below and is bound thereby.
When it is alleged that a defendant is indebted to plaintiff and defendant admits that all or a portion of the debt is due, the court is authorized to enter judgment accordingly. G.S. 1-510.
McKay v. Investment Co.,
228 N.C. 290, 45 S.E. 2d 358;
Fertilizer Co. v. Trading Co.,
203 N.C. 261, 165 S.E. 694.
In affirming the judgment below we approve only those conclusions of law necessary to support the judgment and which are in accord with this opinion.
Affirmed.