Stonev. Daily

This is a suit to quiet title to certain real property formerly belonging to one Mrs. Rebecca J. Daily, now deceased. The defendant is the surviving husband of Mrs. Daily and claims the property by reason of a deed of gift by her to him which for convenience we may call the Daily deed. The plaintiff, Mrs. Cora L. A. G. Stone, is a daughter of Mrs. Daily by a former husband, and is her only child, and the other plaintiffs are Mrs. Stone’s children, Mrs. Daily’s grandchildren. The plaintiffs claim under a deed of gift by Mrs. Daily to them, made subsequent to the Daily deed and which for convenience we may call the Stone deed. The plaintiffs contend that the Daily deed, while signed and acknowledged by Mrs. Daily, was not, in fact, delivered by her so as to become an effective instrument of conveyance. The defendant makes a similar contention with reference to the Stone deed, and the sole questions in the case are as to the respective deliveries of these two deeds. The trial court found that neither deed was delivered, with the result that neither the plaintiffs nor the defendant were the owners of the property except as they might be the heirs at law of Mrs. Daily, and gave judgment to that effect. From this judgment both sides appeal.

There is little, if any, conflict in the evidence. The dispute turns on the conclusions, both of law and of fact, to be drawn from the facts which appear in evidence. The land in question is a ranch in Lake County, which Mrs. Daily owned at the time of her marriage to Daily, and upon which she lived at that time and continued to live until her death. The deed to Daily was made in January, 1900,• a year after the marriage. Daily was forty-seven years of age at the time and his wife some years older. Daily had no property, and, according to his testimony, the deed to him was made because he felt, and represented to his wife that he needed, some protection in his old age in case his wife would die first. Mrs. Daily thereupon consulted her attorney about making a deed to Daily reserving a life estate in herself. Her attorney advised her to make a will, saying that if she made a deed she could not take it back, but that if she made a will she could change it. She replied that she did

“We George L. Daily and Rebecca J. Daily, husband and wife, do hereby deposit this sealed envelope and its contents in the Bank of Lake at Lakeport, Cal., and we and each of us do hereby instruct the said Bank of Lake to hold the said envelope and its contents so long as we may live; and during such time not to deliver the same to either of us nor to any other person, nor suffer the seals to be broken; upon the death of either of us to deliver the same to the survivor on demand.

“Dated January 11th, 1900.”

This indorsement was signed by both Mrs. Daily and her husband and the envelope with the deed inclosed was thereupon deposited with the bank designated, where it remained until "Mrs. Daily’s death, when it was "delivered to the defendant. As a part of the transaction, and apparently looking to the deposit of the deed with the bank, the attorney indorsed on the back of the deed “Received January 11, 1899, ’ ’ and had Daily sign it. The year 1899 was written by mistake instead of 1900, but the difference is immaterial.

[1] Upon the foregoing facts it is plain that if the delivery which must be relied on in order to make the deed effective was the final delivery to the bank under the instructions indorsed upon the envelope, there was no such absolute delivery as must exist in order to give the instrument life. The instructions on the envelope determine the character of the delivery, and make, it one conditional upon

“The all-controlling fact in this case, which defeats plaintiff’s claim, is that when the deeds were made and delivered to the cashier of the bank the respective grantors did not absolutely part with all future dominion and control over them, but, upon the contrary, the actual intention and understanding of each grantor was that upon the death of the other the survivor should take back his own deed, and that no title should vest under it.” (See, also, Canale v. Copello, 137 Cal. 22 , [ 69 Pac. 698 ]; Keyes v. Meyers, 147 Cal. 702 , [ 82 Pac. 304 ]; Long v. Ryan, 166 Cal. 442 , [ 137 Pac. 29 ].)

[2] Other than the depositing of the instrument with the bank under the instructions mentioned, there is no act appearing in evidence which could be said to constitute a valid delivery of. the Daily deed, unless the act of Mrs. Daily in handing the deed to her husband in her lawyer’s office just prior to its inelosure in the envelope and deposit with the bank and saying to him: “Here, George, is the deed and now the property is yours,” constituted such a delivery. A valid delivery might have been so made. If there had been in fact a handing over of the deed by Mrs. Daily to her husband as a final act and with the intent then and there irrevocably to vest in him the title to the property, there was a valid delivery. That afterward, no matter how shortly afterward, the parties changed their minds and sought to make another arrangement, as evidenced by the deposit with the bank, would make no difference. The transfer of title would have occurred, would have been a fait accompli, and could be undone only by a retransfer by Daily. The question is, Did Mrs. Daily hand the deed to her husband as a final act intended irrevocably to vest title in him, regardless of whether he survived her or not?

The trial court by its finding that there was no delivery of the deed impliedly found that this was not done, and in

The question is one of intent: Was the delivery in the lawyer’s office intended to be final and absolute? [3] In the first place, while it is possible to have had such a delivery in spite of the fact that immediately thereafter a very different arrangement was made by depositing the deed with the bank, the inference to the contrary arising from such deposit is very strong. The handing over of the deed to. Mr. Daily and the agreeing upon its deposit with the bank were both parts of one continuous occurrence, of which the deposit in the bank is the final result. Such deposit is certainly what the parties finally intended; in fact, Mr. Daily so testifies; and the inference is very strong that anything done previously was merely preliminary and not final. There is no evidence to overcome this inference. In addition is the strongly confirmatory circumstance that the deposit, with the bank accords with what the parties intended to do when Mrs. Daily went to her lawyer’s office, and the absolute delivery of the deed to Daily does not. Mr. Daily himself testifies that the understanding between Mm and his wife before the deed was drawn was that the prop- ■ erty was to be his only in case his wife died before him. If the deposit with the bank were effective, it would have accomplished just this, while the absolute delivery of the deed to him would not.

[4] We attach no significance favorable to delivery to the indorsement upon the deed signed by Daily acknowledging, its receipt, but rather the contrary. There would have been no occasion for the indorsement if the deed were to remain in Daily’s hands. The only reason apparent for making it.

[5] In the second place, Mr. Daily testifies that at the time the deed was handed to him Mrs. Daily requested that it be not recorded and there is a strong inference at least from much that appears in evidence that Daily and his wife both had the not uncommon belief that the deed would not be effective unless recorded. If this was so, then the delivery to Daily was not valid, even assuming that the parties intended it at the moment as the final consummation of the matter and the deposit with the bank represents a subsequent change of mind. Under such circumstances the delivery, while final in one sense, was not intended as absolute, but was upon the condition that it was not to be recorded until Mrs. Daily’s death, and in case Daily died first, was not to be recorded or be effective at all. If this were the character of the delivery, and we believe that this is the utmost that can be said for it, it comes directly within the authority of Kenney v. Parks, 137 Cal. 527 , [ 70 Pac. 556 ]. The facts there were that a wife gave her husband a deed under the belief that it would not he valid until recorded and upon her husband’s promise that he would not record it unless he survived her. He recorded it nevertheless and in a suit by the wife to recover the property it was held that there had not been a valid delivery. As we have said, we think that the utmost that can be said for the handing over of the deed by Mrs. Daily to her husband is that it was upon the same understanding as that in Kenney v. Parks. Our conclusion, therefore, is that not merely is there evidence to justify the finding that the Daily deed was not delivered, but it would be very difficult to justify any finding to the contrary.

The Stone deed was made in 1916, some sixteen years after the Daily deed, and purported to convey all of the property of the grantor, both real and personal, to Mrs. Stone for

“And in the meantime I did study the question up and as a result of my study I told her that if she truly understood it in her own mind it was all right, that when she signed the deed and delivered it to a third person, that if she got possession of it again—the deed—that it was not her property in any respect, she could merely hold it for preservation and safekeeping, not only that but .she didn’t own the land, except what reservations she embodied in the deed, and that could be done.” „

Mrs. Daily thereupon told Neal to draw the deed, which he did. On her return to his office for the purpose of executing it and immediately prior to its execution, Neal

“To be handed to Fred A. Greene on my death.

“(Signed) Rebecca H. Daily.”

The box was one which remained in the bank, but was Mrs. Daily’s private box to which she alone had the key. The deed remained in the box until Mrs. Daily’s death.

There is no dispute as to the above facts. The position of defendant’s counsel, and apparently from the record the view of the trial judge, are that they do not amount to a valid delivery because of the final retention of possession of the instrument by Mrs. Daily, and in this connection it should be noted that such possession was in accord with the intention of Mrs. Daily before and at the time of her handing the deed to Greene. If her retaking the deed had been purely an afterthought there could be no reasonable question as to the validity of the delivery, but it was not an afterthought and the matter must be judged with this fact in mind. Nevertheless, we think there was unmistakably a final and absolute delivery. It is a question purely of Mrs. Daily’s intent.

The final result of the transaction was, of course, the deposit of the deed in her private box in an envelope bearing an indorsement that it was to be handed to Mr. Greene' upon her death. If there were nothing more, the conclusion would be irresistible' that the instrument was not to become effective in any way until her death and that there was no real delivery. Furthermore, the inference would be strong that anything which occurred previously in the course of the transaction which had this as its final result was but pre

But the retaking of possession and subsequent retention of the instrument by Mrs. Daily is not conclusive even though it appear that it was not an afterthought, but contemplated by her from the beginning. It is a very strong circumstance . indicating that she did not intend such delivery as would put the deed beyond her control and power of recall, and would ordinarily be controlling. But the final question always is, What was the intent with which the formality of a delivery was gone through with? And if it appear indubitably that it was gone through with for the purpose of conveying the property then and there, and that the grantor desired thereafter to retain, and did retain the instrument, not that she might control or suspend its taking effect, "but for the purposes of custody and safekeeping merely, as, for instance, to insure its not being recorded because she did not wish her husband to know of it, any_ contrary inference

[6] The case, then, is one where the formality of a delivery is gone through with with the intent of making an immediately effective conveyance, but after delivery the grantor retains possession of the deed for purposes of safekeeping. That such a delivery is valid and is not affected by the fact that the instrument subsequently remains in the possession of the grantor is well established. Chancellor Kent, in his Commentaries (volume 4, pages 455, 456), says: “So, if a deed be duly delivered in the first instance, it will operate though the grantee suffer it to remain in the custody of the grantor. If both parties be present, and the usual formalities of execution take place, and the contract is to all appearances consummated without any conditions or qualifications annexed, it is a complete and valid deed, notwithstanding it be left in the custody of the grantor.”

In Devlin on Deeds (third edition), section 278a, it is said: “Where a deed has been duly delivered, the fact that the grantee allows it to remain in the custody of the grantor will not invalidate it. A deed may be returned, after delivery to the grantor, so as to insure that it would not be placed on record without affecting the delivery.” (See, also, Kenniff v. Caulfield, 140 Cal. 34 , [ 73 Pac. 803 ]; King v. Fragley, 19 Cal. App. 735 , [ 127 Pac. 813 ]; Doe v. Knight, 5 Barn. & C. 671; Souverbye v. Arden, 1 John. Ch. (N. Y.) 240; Scrugham v. Wood, 15 Wend. (N. Y.) 545 , [ 30 Am. Dec. 75 ]; Rodemeier v. Brown, 169 Ill. 347 , [ 61 Am. St. Rep. 176 , 48 N. E. 468 ]; Munro v. Bowles, 187. Ill. 346, [ 54 L. R. A. 865 , 58 N. E. 331 ]; Riegel v. Riegel, 243 Ill. 626 , [ 90 N. E. 1108 ]; Ruckman v. Ruckman, 32 N. J. Eq. 259 ; Tarbox v. Grant, 56 N. J. Eq. 199 , [ 39 Atl. 378 ]; Wall v. Wall, 30 Miss. 91 , [ 64 Am. Dec. 147 ].) In a number of

Counsel for defendant refer to the language of a number of cases such as Bury v. Young, 98 Cal. 446 , [ 35 Am. St. Rep. 186 , 33 Pac. 338 ], Kenney v. Parks, 125 Cal. 146 , [ 57 Pac. 772 ], Keyes v. Meyers, 147 Cal. 702 , [ 82 Pac. 304 ], Moore v. Trott, 162 Cal. 268 , [ 122 Pac. 462 ], and Long v. Ryan, 166 Cal. 442 , [ 137 Pac. 29 ], to the effect that “The essential requisite to the validity of a, deed transferred under circumstances as indicated in this case, is that when it is placed in the hands of the third party, it has passed beyond the control of the grantor for all time.” But an examination of these cases shows at once that when they speak of the necessity of the control of the instrument passing from the grantor for all time, they mean control in the sense of power to recall it, control over it as an effective instrument of conveyance, not control in the sense of having the mere physical custody of it. This is strikingly shown by Moore v. Trott, supra, where, on page 274 of the report (162 Cal.), 122 Pac. 465 , it is said:

“It has long, if not always, been the,rule that the delivery . of an instrument is a question of intent, and that to a complete delivery no precise form of words and no particular character of act is necessary. The delivery is sufficient and complete if from any or all. of the circumstances the grantor has made known his intention irrevocably to part with his dominion and control over the instrument, to the end that it may presently vest title in another.” And yet, on the next page, the following quotation from Ruckman v. Ruckman, supra, is made with approval:

“Whenever it appears that the contract or arrangement between the parties has been so far executed or completed, that they must have understood that the grantor had divested himself of title, and that the grantee was invested with it, delivery will be considered complete, though the instrument itself still remains in the hands of the grantor. ’ ’

[7] To sum the discussion up, it appears as to the Stone deed that it was formally delivered by the grantor to a third person for the grantees; that it was the intention of the grantor in making such delivery that the instrument should be immediately effective and vest in the grantees

Judgment reversed for a new trial upon the issue as to the delivery or nondelivery of the Stone deed, the finding as to the nondelivery of the Daily deed to stand.

Shaw, J., Lennon, J., Melvin, J., and Lawlor, J., concurred.

I am not satisfied that a finding of the trial court to the effect that the Daily deed was delivered could properly be held to be without sufficient support in the evidence. The finding actually made, however, was that such deed was not delivered, and as shown in the opinion, this finding has ample support in the evidence. In all respects other than the intimation that a finding to the contrary could not have been sustained by an appellate court, I concur in the opinion and in the judgment.

Wilbur, J., concurred.

Rehearing denied.

All the Justices concurred, except Melvin, J., who was absent.