200 A. 624 | Pa. | 1938
Appellees, husband and wife, sued to recover the balance of a savings account in appellant bank. This account had been in the name of both as "Joint Owners. Payable to either before or after the death of the other." The bank asserted that because of an "Agreement of Waiver and Release" executed by the husband for a substantial consideration during the reorganization of the bank, there was no longer any liability on the account. Appellees contended, however, and the trial court ruled, that, the deposit being held by the entireties, the wife's failure to join personally in this agreement rendered the release ineffective. Assigned as error is the failure of the court below to enter judgment n. o. v. for appellant bank.
Except for a few American jurisdictions, which by statute or otherwise have abandoned the common law, tenancies or estates by entireties are universally recognized as a traditional method of holding property. They have existed for centuries.1 In this State they were first discussed elaborately in Johnson v. Hart, 6 W. S. 319, and Fairchild v.Chastelleux,
The nature of estates by the entireties is generally well understood. They are simply a form of co-ownership, *481
a particular type of "joint estate," held by husband and wife. At common law four main types of "joint estates" orco-ownership existed: joint tenancies, tenancies in common, coparcenary, and tenancies by entireties. Each had salient differences: Tiffany, Real Property (2d ed.), vol. 1, chapter VII, analyzes them fully. See also Tiedeman, Real Property (3d ed.), chapter IX. Joint tenants at common law hold the entire estate by the half and by the whole, per my et per tout. SeeLeach's Estate,
Tenancies by the entireties, our major concern, resemble joint tenancies. All four of the unities are present. But as Blackstone says (page 182): ". . . if an estate in fee be given to a man and his wife, they are neither properly joint-tenants, nor tenants in common: for husband and wife being considered as one person in law, they cannot take the estate by moieties, but both are seised of the entirety, per tout, et non per my: the consequence of which is, that neither the husband nor the wife can dispose of any part without the assent of the other, but the whole must remain to the survivor." To the four unities of a joint tenancy therefore is added the unity of the husband and wife as a person in the law. Coke upon Littleton, section 291, in treating the subject of entireties, refers to the unity of husband and wife as the basis for the estate and relies on Bracton's *482
maxim: "Man and wife are as one person, for they are one in flesh and blood." As a consequence of this relation manyincidents flow therefrom quite different from those arisingfrom a joint tenancy or any other form of co-ownership. While a tenancy by entireties resembles a common law joint tenancy in that each spouse owns the whole and therefore is entitled to enjoyment of the entirety and to survivorship,3 it differs in that neither one has any individual portion which can be alienated or separated, or which can be reached by the creditors of either spouse. See Meyer's Estate (No. 1),
Our several married women's acts have not disturbed this common law estate though they materially affected the incident of the husband's control. This was first decided in Diver v.Diver,
Not only has the legislature not abolished estates by entireties but it has expressly recognized them in various statutes,5 and has thus approved the established rule that husband and wife may hold property by entireties.
Such tenancies therefore continue to be recognized as a valid and desirable method of holding property between *484 husband and wife, and the presumption remains that where property is held in the names of husband and wife they hold it by entireties and not as ordinary joint tenants or as tenants in common: Bramberry's Estate, supra.
There can be no question that personal property in Pennsylvania may be held by husband and wife by the entireties. The rule is grounded on sound principles of common law and is concurred in by the majority of common law jurisdictions. Blackstone recognizes the existence of joint interests in personalty. Any doubt which may have arisen as to entireties in personalty is due to the fact that under the common law when a married woman acquired personalty it immediately became the husband's exclusive property if reduced to possession. But where he failed to take possession complete ownership was not acquired, and survivorship followed, when one spouse predeceased the other, to the exclusion of the next of kin of the deceased spouse. See Lodge v. Hamilton, 2 S. R. 490;Gibson v. Todd, 1 Rawle 452; Frankenfield v. Gruver,
Many types of personalty have been held as subjects of tenancies by entirety. Gillan's Executors v. Dixon, supra, so decided as to the personal estate of a deceased daughter passing to her parents; Bramberry's Estate, supra, a bond and mortgage; Parry's Estate,
We have held in a long line of cases that bank deposits and similar choses in action, payable to husband and wife, or to husband or wife, are tenancies by the entireties with all the incidents relating thereto. Here a bank account is held by the husband and wife together. Title to the account must vest somewhere in some form recognized by the law. There is nothing in the nature of a bank account payable to husband and wife, or husband or wife, which would rebut the presumption that title was in husband and wife by the entireties. See Parry's Estate, supra. In Klenke's Estate (No. 1), supra, a bank account in the names of husband and wife with the provision that "We or either of us may draw upon the bank during the continuance of said account" was held to go to the wife on the death of the husband because survivorship is a direct result of tenancy by entireties. It was there argued that the word "or" defeated that result by preventing the deposit from being a tenancy by entireties, but the Court expressly rejected the argument. *486 See also Blick v. Cockins, supra. In Sloan's Estate, supra, certificates of deposit were made payable to the order of the husband or wife. The Court expressly relied on the doctrine that the certificates were held by the entireties to reach the conclusion that the incident of survivorship was present. SeeBerhalter v. Berhalter, supra. In Wilbur Trust Co. v. Knadler, supra, it was decided that the word "or" made no difference in the mortgage trust certificates involved, and that they were owned by the entireties with survivorship. In Bostrom v.National Bank of McKeesport, supra, an account payable to either spouse was not subject to set-off by the bank for the debt of one of them, because the account was by the entireties. The same result followed in Pennsylvania Trust Co. v. Mischik, supra, where it was held that, since it was such an account, the husband could not pledge it for his individual debt.
But it is urged upon this Court that "unity of control" is lacking and the account is therefore not held by the entireties, because of the absence of an essential element. Nothing in the development of tenancies by the entireties requires such a "unity of control" that one spouse may not authoritatively act for both, nor is Blackstone's statement that "neither the husband nor the wife can dispose of any part without the assent of the other" denied.
Where a deposit is payable to "husband and wife," — a deposit by entireties — the husband and wife may withdraw the funds if they sign together. But there is nothing in the law relating to entireties that would prevent the wife from giving the husband express authority to sign for her as her agent and withdraw for both of them, although no such authority may be implied. When, on *487
the other hand, an account is made payable in its creation to either "husband or wife," there is an immediate expression of authority, of agency to act for both. As an incident of these estates by entireties is the power that each gives the other, at the time of the estate's creation, to act for the other. This conclusion is beyond debate. In Milano v. Fayette T. T.Co., supra, the Superior Court discussed the difference between deposits in the name of husband and wife and those in the name of husband or wife. There the deposit read "and," and the bank paid out on an order drawn by the husband alone. President Judge KELLER clearly distinguished the cases where deposits were payable to either husband or wife, on the ground that while in such cases there can exist authority to withdraw the corpus, there was no such authority to the husband alone where the words "payable to husband and wife" were used. See alsoO'Malley v. O'Malley, supra; Gasner v. Pierce,
Moreover, in answer to the argument that where one spouse can withdraw all the funds it should prevent a tenancy by the entireties from arising, there exist many instances at common law in which one spouse could exercise great control, short of destruction, over the res of the entireties. By virtue of his control over all the marital property, a husband, prior to themarried women's acts, could, as has been said, even alienate ormortgage the property for the duration of his life. The wifecould be dispossessed for that period and could claim no rights unless and until she survived her husband. In Fairchild v.Chastelleux, supra, to repeat, a husband was allowed to maintain an action of trespass alone, without joining his wife. In Stuckey v. Keefe's Executors,
The authorities thus cited would seem to show that either spouse presumptively has the power to act for both, so long as the marriage subsists, in matters of entireties, without any specific authorization, provided the fruits or proceeds of such action inures to the benefit of both and the estate is not terminated. But neither may by such action destroy the true purpose of the estate by attempting to convert it or a part of it, in bad faith, into one in severalty.
As stated, where the estate stands in the name of husbandand wife there is no implication of agency to conclude the estate. Thus where a husband and wife hold a mortgage, the husband has no authority to take a deed to himself and in that way destroy the wife's interest in the mortgage: Sparrow v.Mowers, supra. Nor is there a presumption of agency in the wife to convey real estate held by entireties without the husband's joinder: Thees v. Prudential Ins. Co.,
Where a deposit is made payable to either spouse, agency or authority exists by implication, and the husband or the wife may, from that authority, withdraw the entire account, but the money thus withdrawn is impressed with the entirety provisionthat it is the property of both, and any one dealing with such specific property as severalty, knowing it belongs to both, must submit to the consequences. However, the bank, acting in good faith, is protected when funds are withdrawn by either:Berhalter v. Berhalter, supra.
Textbooks, and cases depending on statutes, which criticise the rule, are of little help when considering common law entireties. E.g., Zollman on Banks Banking, Volume 5, Section 3225; Murphy v. Michigan Trust Co., *490
The lower court held the deposit a tenancy by the entireties, but, by concluding the release was invalid for want of written joinder of the wife, overlooked the power granted under the agency expressed in the creation of the account. Certainly the power to withdraw all of the funds includes within it the power to preserve or protect the fund and to consent to a reorganization of a "closed" bank for that purpose, though it made the deposit somewhat smaller but did not entirely deplete the funds. This act did not destroy the res of the estate but inured to its preservation. The refusal in Schroeder v. GulfRefining Co. (No. 1), supra, to hold the release enforceable by the obligor in no way controls the instant case, for there the building was already destroyed, and no authority was manifested in the creation of the estate which would allow the husband to terminate the obligor's liability, the new res of the estate. Here, however, such authority existed when the deposit was made.
This conclusion establishes the immunity of the appellant bank, but, as above shown, in no way affects the rights as between the husband and wife. O'Malley v. O'Malley, Gasner v.Pierce and Berhalter v. Berhalter, indicate that, while the bank may be relieved by the act of one of the spouses in receiving payment or in freeing it of liability, the rights between husband and wife are not determined.
It has been urged upon the Court that this was not a tenancy by the entireties, a view which would cause tens of thousands of deposits, long made in reliance on the *491 established rule of this Court, to be subject to the action of the creditors of either the husband or the wife. Moreover, the legislature has, on the faith of our settled interpretation of the law, expressly recognized the freedom of estates by entireties as we have defined and recognized them from the transfer inheritance tax, upon the death of one of the spouses.7 Countless deposits have been made in banks in the names of husband and wife, or husband or wife, upon the assurance of the decisions of this Court, and of legislative pronouncements, that they were not to be subject to that tax. To change or modify our conception of the estate by entireties would have the effect of laying open to taxation all such deposits. It would include many where the estates of decedents have been settled and the period of limitations8 has not yet run. On reason and authority we find no cause to change our conception of such estates. It would overrule many decisions and overthrow what has now become a fixed rule of property. The great public interest involved in these deposits is therefore apparent, and for this reason it has been incumbent upon the Court to reaffirm the principles applicable to tenancies by entireties and to refuse to overrule them.
Judgment reversed at cost of appellees.