1 N.Y.2d 284 | NY | 1956
Lead Opinion
This is a contest between the two daughters of Elizabeth M. Creekmore over the proceeds of two savings bank accounts aggregating about $15,000, which belonged to Mrs. Creekmore, and constituted about three fifths of her assets at the time of her decease. Letters testamentary have been issued to Mrs. Howland under Mrs. Creekmore’s will executed
This bequest was the only gift made to Mrs. Ogg by her mother’s will. Mrs. Rowland has not charged herself as executrix with the proceeds of these savings bank accounts, however, and claims them as entirely her own property due to the circumstance that on November 28, 1951 they purport to have been placed in joint account with her by her mother. The circumstances under which this change was made will presently be discussed in greater detail, because the decision of the appeal hinges upon them. Mrs. Ogg objected in this respect to the judicial settlement of Mrs. Rowland’s account as executrix, and insists that these bank accounts be distributed as part of her mother’s estate so that she may obtain half of them under the bequest which has been quoted. The issue is whether these funds pass under the will or to Mrs. Rowland as survivor under section 239 of the Banking Law. This question is to be resolved by whether Mrs. Creekmore validly established them as joint accounts so as to bring them within the operation of that statute. This depends upon what happened on November 28, 1951 when she signed the signature cards transferring the form of these deposits from her own name to the names of herself and Mrs. Rowland.
Fatally stricken with cancer, and suffering from a broken thigh, Mrs. Creekmore was in her final illness at the Lenox Trill Hospital in New York City. On the previous day a letter had been written at her behest by Mrs. Rowland to Mrs. Creekmore’s attorney, William Matthews, which stated:
11 My mother, who is quite sick and a patient at Lenox Hill Hospital, has asked me to contact you to help in getting the necessary forms put through to give me complete power-of-attorney on the following bank accounts so that I may be able to pay her bills if and when necessary. Probably under name — Elizabeth M. Creekmore.
*288 (This one primarily) Guarantee Trust Co.
60th St. and Mad. Ave.
Emigrant
42 St. between Mad. and
5th Ave.
Franklin
8th Ave. and 42 St.
Empire
125 St.
‘ ‘ My mother has also requested that I be deputized to open her safe deposit box if and when necessary and I would appreciate it very much if you can obtain that form for me too. The box is No. 882 and is in the Guarantee Trust Co. 60th and Mad. Ave.
“ My Father sends his best regards and asks me to tell you that he too would appreciate it very much if you would take care of this for us. He is not well himself.”
Upon receipt of this letter on November 28,1951, Mr. Matthews procured forms of power of attorney from the Guaranty Trust Company enabling Mrs. Rowland to draw upon Mrs. Creek-more’s account and to have access to her safe-deposit box. These powers of attorney were signed by Mrs. Creekmore and forwarded by her attorney to the Guaranty Trust Company. This was done simultaneously with the transactions in suit.
It was a different story at the Emigrant and Franklin Savings Banks. When Mr. Matthews arrived there as Mrs. Creekmore’s emissary and requested forms for power of attorney according to her request, he was told in each instance that the bank was opposed to accepting powers of attorney, that they did so only under protest, that they had no power of attorney forms available, and recommended that the accounts be changed to joint accounts in the names of decedent and Mrs. Rowland who was to have been the grantee of the powers of attorney. This policy on the part of these savings banks did not concern the welfare or purposes of Mrs. Creekmore, but was designed to protect the banks against inadvertently cashing checks drawn by the attorney-in-fact of a decedent. Everyone knew that Mrs. Creek-more was not long for this world. These banks evidently did not notice or care that the course of procedure which they were recommending would materially alter the devolution of these accounts upon Mrs. Creekmore’s decease.
In his decision the Surrogate found as a fact that Mrs. Rowland “ has not shown that the alleged joint accounts were knowingly and consciously created and sanctioned by her mother ”, but the Appellate Division reversed “ on the law ” at the same time stating in the order that “ the findings of fact are hereby affirmed ”. This included an affirmance of the finding that these joint accounts had not been shown to have been knowingly and consciously created and sanctioned by decedent, unless the uncontroverted evidence established that they were thus created. The Appellate Division appears to have based its reversal and dismissal of Mrs. Ogg’s objections exclusively upon the circumstance that these accounts were in the form described by subdivision 3 of section 239 of the Banking Law.
The position of Mrs. Ogg is that the burden lay upon Mrs. Rowland to establish that their mother knew what she was doing when she signed these signature cards. She does not charge Mrs. Rowland with having schemed to subvert her mother’s intention, her position being just that the mother never knew that she was signing any such thing. Consequently Mrs. Ogg has not charged her sister with practicing fraud or undue influence. The burden is still upon Mrs. Rowland to show that it was her mother’s conscious act and deed. The Appellate Division held that she had sustained this burden due to the bare circumstance that the cards had been signed by her mother, in the absence of a contention that someone was trying to take advantage of her, concluding: ‘
The Fenelon and Moskowitz cases (Matter of Fenelon, 262 N. Y. 57; 262 N. Y. 308; Moskowitz v. Marrow, 251 N. Y. 380) involved no question of incapacity, lack of volition or mistake on the part of the creator of a joint account. Before the enactment of the predecessor statute to section 239 of the Banking-Law, the query had been suggested in some of the decided cases that more might be necessary to create a survivorship interest in a joint account than merely opening the account in that form (cf. Kelly v. Beers, 194 N. Y. 49; Schneider v. Schneider, No. 1, 122 App. Div. 774, 780). The Fenelon and Moskowitz cases put to rest that question, holding that under section 239 the executed intention to make a deposit “ in form to be paid to either or the survivor ” sufficiently evinced a purpose that the proceeds of such an account should belong to the survivor after the death of the other. Ordinarily the signature to joint deposit slips is sufficient evidence of an intention to make a gift to the survivor,
The need to establish volition on the part of the depositor to make the deposit in the statutory form is thus clearly recognized in Fenelon, concerning which the burden of proof throughout is upon the survivor claiming to own the deposit on account of the death of the other alleged joint depositor. Absence of volition, due to incompetency or to excusable mistake concerning the nature of the instrument, should not be confused with subversion of volition by some self-seeker, which is undue influence or fraud. In the former instance there is no will or purpose to undertake the transaction, whereas in the latter the purpose exists but has been induced by some external, sinister agency. That is not claimed to have existed here, but the circumstance that Mrs. Rowland is not accused of having preyed upon her
Opening these joint accounts, instead of continuing the funds in Mrs. Creekmore’s name as sole depositor, would have the ■ effect of drastically changing the testamentary disposition which she had made of these accounts two years before that was never superseded by the execution of any subsequent will. Only a short while before she signed these signature cards, she had requested powers of attorney which evinced no intention to change the devolution of these accounts upon her death, but would merely have empowered her daughter, Mrs. Rowland, to pay the large bills connected with her illness and other items for her account. The power of attorney which Mrs. Oreekmore succeeded in executing to Mrs. Rowland to draw upon her account in the Guaranty Trust Company accomplished. that objective respecting that account, and there is reason to believe that in her weakened condition she assumed that she was signing equivalent instruments providing for withdrawals from the Emigrant and Franklin Savings Banks for the same purpose, as had been requested in the letter which called for powers of attorney — not joint deposits — in the case of each of these bank accounts. It is improbable that during the five or ten minutes while she was alone with Mr. Matthews in her sick bed at the hospital, she changed her previous testamentary plan, without altering her will which gave half of each of these specific savings bank accounts to each daughter, and decided to disinherit Mrs. Ogg.
Under subdivision 3 of section 239 of the Banking Law, as in the probate of a will, the burden of proving fraud and undue influence is upon the contestant (Matter of Schillinger, 258 N. Y. 186). But the burden is always upon the proponent of establishing the competency of the testator and the genuineness of the will (Matter of Schillinger, supra; Rollwagen v. Rollwagen, 63 N. Y. 504; McLaughlin v. McDevitt, 63 N. Y. 213; Matter of Budlong, 126 N. Y. 423; Delafield v. Parish, 25 N. Y. 9, 35; Matter of Bedell, 107 App. Div. 284; Matter of Regan, 206 App. Div. 403; Matter of Mullin, 143 Misc. 256, affd. 240 App. Div. 996, affd. 265 N. Y. 491; Matter of Reilly, 139 Misc. 732; Weir v. Fitzgerald, 2 Bradf. 42, 68-69; Matter of Rintelin,
The circumstances which require additional proof to supplement the mere formal execution of the instrument vary with the vicissitudes of life. In a classic statement in Weir v. Fitzgerald (2 Bradf. 42, 68-69, supra), where the testator’s eyesight was impaired, the learned Surrogate said concerning the probate of a will: ‘ ‘ These forms are necessary, but, even when satisfied by the evidence, do not always entitle the will to be admitted to proof. Something more is necessary to establish the validity of the will, in eases where, from the infirmities of the testator, his impaired capacity, or the circumstances attending the transaction, the usual inference cannot be drawn from the mere formal execution. Additional evidence is therefore required, that the testator’s mind accompanied the will, that he knew what he was executing, and was cognizant of the provisions of the will.”
In Matter of Reilly (139 Misc. 732, supra), where the testatrix had sustained a stroke, Surrogate Slater wrote: - “ In cases of persons who are ill, as well as in cases of illiteracy, there is no presumption that they know what they are doing. The knowledge of the contents of a will and the character of the paper have to be proven. There was the ordinary proof of the factum of the will. But, in this case, the proponent is required to show that the testatrix had an intelligent knowledge of the contents of the will, which has not been shown by the evidence of the three witnesses to the will. There must be proof that she knew its contents and that it expressed her intention.” (p. 736).
Especially is this true, where, as in the present instance, Mrs. Creekmore might easily have been confused by the distinction between a joint account to the credit of either or the survivor, and a mere power of attorney which was all that she had sought and what she was evidently endeavoring to execute.
Surrogate Wingate wrote in Matter of Mullin (143 Misc. 256, 259, supra), affirmed without opinion in the Appellate Division and in the Court of Appeals, that“ placing the burden of proof in this regard upon the proponent as a part of his demonstration of the validity of the document * * * appears now to be settled respecting such situations.” (Cf. 2 Warren’s Heaton on Surrogate’s Courts, § 187, subd. 2, par. [g].)
There is no mechanical formula whereby the existence of a requirement can be measured or standardized to supply evidence additional to the factum in order to sustain this burden. Physical or mental weakness, although not so far advanced as to destroy competency entirely or under all circumstances, may be held to require, in the judgment of the trier of the fact, some proof additional to formal execution to establish knowledge of what she was doing when she signed the instrument. An invalid may retain enough strength of mind or body to consummate a simple transaction, but suffer complete mental lapse where circumstances conspire to becloud a complex one. This is such a situation. Here the misleading or disconcerting circumstance was not due to guile or self-seeking; nevertheless, the c.reation of these joint accounts had to be Mrs. Creekmore’s conscious and deliberate act, in order to render them valid, and unless she had capacity to appreciate the crucial difference between giving powers of attorney to Mrs. Rowland (which is what she did in the case of the Guaranty Trust Company) and establishing them as joint accounts, she was, in a legal sense, incompetent to create them. There is no simple rule by which all cases of this nature can be judged. Each stands, necessarily, in large degree, upon its own facts. The Emigrant and Franklin Savings Banks are not chargeable with fraud or undue influence, but if Mrs. Creekmore was confused or misled by her reliance upon their recommendations, so that these combined with her failing vitality to destroy her knowledge of what she was doing, the result is a nullity. It cannot be ignored that Mrs. Creekmore had confidence in these banks where she had kept the major portion of her property. She designed merely to give powers of attorney to her daughter, Mrs. Rowland, to draw on these
The testimony of Mr. Matthews concerning the. professional advice which he gave to Mrs. Creekmore was correctly excluded. He stated that he and Mrs. Creekmore were alone at this time, that whatever conversations of this nature occurred were prior to her signing these instruments, and he was merely precluded from testifying to any legal advice which he- may have given to her upon this occasion. It was not until after these confidential communications had ended, that Mrs. Rowland and the notary re-entered the room when the documents were signed. Under the case of Rosseau v. Bleau (131 N. Y. 177, 183-184), testimony by Mr. Matthews would not have been privileged that he was instructed by Mrs. Creekmore to deliver these signature cards to the Emigrant and Franklin Savings Banks, but he was not interrogated concerning that. He was asked to state if he did
The order of the Appellate Division should be reversed and the original decree of the Surrogate’s Court reinstated, with costs in this court and in the Appellate Division, payable out of the estate.
. Upon the trial, respondent sought to elicit from the attorney whether during this conversation he advised her of the “legal effect” of the joint accounts, but the surrogate sustained appellant’s objection to the introduction of such testimony and it was not received.
Dissenting Opinion
(dissenting). In my opinion, the unanimous determination of the Appellate Division should be affirmed, for the-record contains no evidence whatsoever casting doubt upon the conclusion that Elizabeth Creekmore created the two joint accounts, here involved, with survivorship rights in her daughter, May Rowland. She signed the documents setting up those accounts following a conference with her lawyer and in bis presence; there is no doubt that she was mentally competent, and there is not the slightest intimation that she was the victim of any fraud or undue- influence.
The applicable statute, subdivision 3 of section 239 of the Banking Law, is clear beyond peradventure. The setting up of a joint account in the names of the depositor and another person, ‘ ‘ in form to be paid to either or the survivor of them, ’ ’ furnishes “ conclusive evidence ” of- an intention to vest title, to the deposit in the survivor. These are the very words of the statute (Banking Law, § 239, subd. 3): “ The making of the deposit in such form shall, in the absence of fraud or undue influence, be conclusive evidence, in any action or proceeding to which either the savings bank or the surviving depositor is a party, of the intention of both depositors to vest title to such deposit and the additions thereto in such survivor.” (Emphasis supplied.) And in an unbroken line of decisions, this court has declared that the provision means precisely what it says. (See Walsh v. Keenan, 293 N. Y. 573, 578-580; Inda v. Inda, 288 N. Y. 315; Matter of Juedel, 280 N. Y. 37, 41; Matter of Fenelon, 262 N. Y. 308; Matter of Porianda, 256 N. Y. 423; Moskowitz v. Marrow, 251 N. Y. 380.) Enacted as it was to provide a rule of certainty for banks and depositors alike (see Moshowits v. Marrow, supra, 251 F. Y. 380, 387-388), the statute, we have said, creates a presumption “ irrefutable by proof, and, therefore, a rule of substantive law. ’ ’ (Matter of Porianda, supra, 256. N. Y. 423, 425; Walsh v. Keenan, supra, 293. N. Y. 573, 578.)
Absent proof of fraud and undue influence, all that must needs be shown is “ the ‘ making ’ of the deposit in statutory form ”, and that is established by evidence that the depositor signed the essential documents instructing the bank to ‘
In the case before us, there can be no dispute about the “making of the. deposit ” in the prescribed form, in this instance, by Mrs. Creekmore’s signing of the deposit cards which expressly “ authorized and directed ” the bank to establish joint accounts. The situation is quite different, therefore, from that in Matter of Yauch (supra, 296 N. Y. 585), to which the majority points to support a reversal (p. 294). In Yauch the finding that the depositor did not ‘ ‘ knowingly and consciously ” create a joint account was based upon evidence that she signed blank forms which were later filled in by the bank. Here, on the contrary, Mrs. Creekmore’s attorney testified that he brought the regular joint account deposit forms to her at the hospital and that she signed them, after a brief conference with him and, presumably, upon his advice.
That being so, I cannot agree with the court’s view that Mrs. Creekmore did not “ knowingly and consciously ” create the joint accounts. As already indicated, there is no evidence of incompetency, fraud or undue influence; not even an inference of incapacity may be drawn from the fact that she was old or ailing. (See Horn v. Pullman, 72 N. Y. 269, 276; Matter of Wolf, 196 App. Div. 722, 728; see, also, 2 Jessup-Redfield, Surrogates’ Law and Practice [Rev. ed., 1947], § 784, p. 137.) Under the circumstances, even under ordinary rules of evidence, proof that Mrs. Creekmore signed the documents authorizing joint accounts would be sufficient to charge her with the legal consequences. (See, e.g., Pimpinello v. Swift & Co., 253 N. Y. 159, 162-164; Metzger v. Aetna Ins. Co., 227 N. Y. 411, 416; Knight v. Kitchin, 237 App. Div. 506, 511; see, also, 7 Wigmore on Evidence [1940], § 2134; 9 id., § 2415.)
Whatever the rule in will cases — and I see no purpose in discussing and distinguishing the decisions cited in Judge Van Vookhis’ opinion — the simple fact is that we are here concerned not with a will but with a document creating a joint bank account. This, the legislature has said in the plainest of language, conclusively effects a right in the survivor, absent evidence of incapacity, fraud or undue influence, to the balance
Conway, Ch. J., Dye and Fboessel, JJ., concur with Van ■ Voorhis, J.; Fuld, J.,'dissents in an opinion in which Desmond and Burke, JJ., concur.
Order reversed, etc.
. Indeed, even in a ease involving a general release (Pimpinello v. Swift & Co., supra, 253 N. Y. 159, 162-163), the court wrote: “ Ordinarily, the signer of a deed or other instrument, expressive of a jural act, is conclusively bound thereby. That his mind never gave assent to the terms expressed is not material. * * * If the signer could read the instrument, not to have read it was gross negligence; if he could not read it, not to procure it to be read was equally negligent; in either case, the writing binds him.”