Opinion
No. 42/610.
08-06-1917
BAILEY et al. v. ORANGE MEMORIAL HOSPITAL et al.
Alfred F. Stevens, of Newark, for complainants. Howe & Davis, of Orange, for defendant Orange Memorial Hospital. Mary Wooster Sutton and Daniel H. Applegate, both of Red Bank, for defendant Helen L. La Brecque. Fisk & Fisk, of Jersey City, for defendants Hattie M. Law, Carrie B. Law, and Josephine L. Ogden.
Suit by Sarah A. Bailey and others, executors of Mary E. Campfield, deceased, against the Orange Memorial Hospital and others. Decree in accordance with the opinion.
Alfred F. Stevens, of Newark, for complainants. Howe & Davis, of Orange, for defendant Orange Memorial Hospital. Mary Wooster Sutton and Daniel H. Applegate, both of Red Bank, for defendant Helen L. La Brecque. Fisk & Fisk, of Jersey City, for defendants Hattie M. Law, Carrie B. Law, and Josephine L. Ogden.
FOSTER, V. C. This action presents for determination the following questions: (1) The right of the defendant hospital to certain shares of stock claimed by complainants as part of decedent's estate. (2) Should the residue of the estate be divided into 11 or 14 parts?
The facts relating to the first question are: That Mary E. Campfield, the testatrix, died about June 10, 1913, leaving a will, which has been duly probated, and under which complainants have qualified as executors. Among the papers which the executors found, in Mrs. Campield's safe deposit box after her death was a certificate made in her name for 50 shares of the capital stock of the United New Jersey Railroad & Canal Company, bearing the following indorsement:
"For value received I hereby assign and transfer unto Orange Memorial Hospital fifty shares of the capital stock represented by the within certificate and do hereby irrevocably constitute and appoint —— attorney to transfer the said stock on the books of the within named corporation with full power of substitution in the premises. Mary E. Campfield.
"Dated Oct. 28, 1911.
"Witnessed by James C. MacDonald."
In the same envelope containing this certificate the executors also found the following letter in the handwriting of Mrs. Campfield:
"To my Executors: The accompanying certificate of fifty shares of the United New Jersey Railroad and Canal Company is my gift to the Orange Memorial Hospital for a bed to be called the 'Mahlon Campfield Bed.' The stock has been retained since its date of transfer because I desire to be benefited by the dividends thereon as long as I live.
"Mary Elizabeth Campfield.
"Dated Oct. 28, 1911."
In this box Mrs. Campfield kept her bonds and mortgages, stock certificates, and other valuable papers relating to her own property and to the estate of her husband, of which she was executrix. There were two sets of keys to the box, one of which was in Mrs. Campfield's possession and the other in the posession of one of her executors, Edward A. Everett, who assisted her for some time in the management of her affairs. Shortly before the indorsement on the certificate wasmade and the letter written, Mrs. Campfield requested Mr. Everett to take the stock certificate from her box and deliver it to her attorney, Mr. MacDonald, stating she would let him know in a few days what to do about it. A few days later Mr. MacDonald handed Mr. Everett an envelope containing the stock certificate, and told him there was a letter with it. Mr. Everett saw the certificate, but did not see the letter, and he placed the envelope containing the certificate in the deposit box. Mr. MacDonald had sealed the envelope after showing him the certificate. After Mr. Everett had told Mrs. Campfield what had been done, she said, "Well, that is for the hospital, and that settles it," and she added:
"It is in an envelope, as yon probably saw. and addressed to my executors, and they will find a letter inside telling them what to do with it."
After this Mrs. Campfield continued to receive the dividends paid on these shares, and there is some evidence to indicate that she had access to the deposit box and examined its contents during the winter preceding her death. As Vice Chancellor Howell remarked in Swayze v. Huntington, 82 N. J. Eq. 127, at page 133, 87 Atl. 106, at page 109, affirmed 83 N. J. Eq. 335, 91 Atl. 1071:
"The general subject of gifts has been dealt with by the courts of this state, including the court of last resort, so many times and under so many circumstances, that there can be no question about the rule which prevails in this jurisdiction."
This rule requires that in order to establish a gift inter vivos the following factors must appear: A donative intention on the part of the donor; an actual delivering of the subject-matter of the gift except in case of a chose in action, in which the delivery must be of the character of which it is most capable, and the donor must devest himself of all ownership and dominion over the subject-matter. Taylor v. Coriell, 66 N. J. Eq. 262, 57 Atl. 810; Matthews v. Hoagland, 48 N. J. Eq. 455, 21 Atl. 1054; Stevenson v. Earl, 65 N. J. Eq. 721, 55 Atl. 1091, 103 Am. St. Rep. 790, 1 Ann. Cas. 49.
I do not think there can be any doubt of Mrs. Campfield's donative intention regarding these shares of stock, and it is equally clear that she never consummated that intention to make the gift, by the actual delivery of the stock to the hospital, or to any one as trustee for it; and it also appears that she intended the gift should be effective only after her death. She expressly retained the ownership and dominion over the stock for the purpose, at least, of collecting and enjoying the dividends paid thereon. From the date of the transfer in October, 1911, until her death in June, 1913, it was always within her power to cancel the assignment indorsed on the certificate and to make such disposition of the stock, by sale or otherwise, as she saw fit. The situation present here is so similar to certain features in the case of Swayze v. Huntington, supra, that Mrs. Campfield's actions with respect to this stock can be properly described in the language of Vice Chancellor Howell, where he said at page 137 of 82 N. J., at page 110 of 87 Atl.:
"The action of the donor * * * demonstrates his intention to retain control of the fund until his death, and thus perform a testamentary act without the formalities attending the execution of a will."
Counsel for the hospital have endeavored to take this case out of the ordinary rule by an argument to show that the certificate of stock and letter were delivered to Mr. Everett, or to the executors, as trustees for the hospital. If this were the fact, the rule of law quoted above would not, of course, apply; but there is not a particle of evidence to support this contention. There is no declaration of trust with respect to the stock; there is nothing to show that Mr. Everett, at the time he took and returned the certificate to the deposit box, knew he was named as an executor of Mrs. Campfield's will, or that she had a will; there is nothing to show that any of the executors knew of the indorsement on the certificate or of the existence of the letter of instructions, or that it had been delivered to them, or placed in their control for the hospital, or for any other object. When Mr. Everett took the certificate from the box to Mrs. Campfield and to Mr. MacDonald and when he returned it to the box, he was acting as her agent or messenger, and was not acting for the hospital. The gift of the stock not having been completed by delivery, or by the relinquishment of control over the certificate representing it, the stock must be declared to be an asset of the estate to be accounted for by complainants.
The provision of Mrs. Campfield's will under which the second question arises is as follows:
"Seventh: The rest, residue and remainder of my estate after payment of said legacies, I direct my executors to pay over in equal shares to the following named persons, viz.: Winthrop Morris, Helen L. Morris, Charles O. Hendrick, Sarah E. Hendrick, Olive A. Hendrick, George B. Murdoch, Kenneth Murdoch, May Law, Josephine Law, Caroline Law and the four children of Mary Hendrick Berry."
And the question presented is whether this provision directs the residue of the estate to be divided into 11 parts, one of which would go to the children of Mrs. Berry, to be divided among them, so that each of the four children would receive a forty-fourth part of the residue, or whether the residue is to be divided into 14 parts, one of which is to be paid to each of the Berry children.
The residuary legatees and Mrs. Berry were all related to the testatrix in the same degree, i. e., as grandnephews and grandnieces; and there is nothing in the will or codicil to indicate an intention on the part of the testatrix that the established rule of construction should not be applied to this provision of her will This rule is that, undera devise or bequest to one and the children of another, the persons all take per capita and not per stirpes. Van Houten v. Hall, 73 N. J. Eq. 384, 67 Atl. 1052.
Some of the defendants insist that this rule is too harsh, unfair, and antiquated, and not in accord with the modern spirit of equitable relief. Assuming this criticism, under the circumstances, to have some merit, still, as Mr. Justice Swayze, in delivering the opinion of the Court of Errors and Appeals in the case cited, remarked, this is the rule recognized in this state, notwithstanding the criticism of it in Roome v. Counter (1822) 6 n. J. Law, 111, 10 Am. Dec. 390.
A decree will therefore be advised, directing the executors to divide the residuary estate into 14 parts, and to pay one of such parts to each of the persons named in the seventh clause of the will, including each of the four children of Mrs. Berry.