Farleigh v. Cadman

Headnote

1. Gifts—Bank Deposits.

A deposit in a bank by a wife in the name of her husband, and in his presence, in trust for a third person, creates a gift in trust, though the husband controls the fund during his life.

2. Same—Control of Deposits—Trustee’s Property.

Deposits in a bank by a husband to the credit of an account opened by his wife in his name, in trust for a third person, are subject to his control, and

do not pass as a gift to the beneficiary of the trust, where the husband declared at the creation of the trust that he would control it for life, and finally placed the additional deposits to the credit of another.

Appeal from special term, Kings county.

Action by Cora Imogene Farleigh against Alfred J. Cadman and others to have $778 and interest, deposited by Sarah Cadman in the name of William J. Cadman, for the benefit of plaintiff, declared a trust, and to have other moneys added by William J. Cadman to the deposit declared a part of such trust fund. From a judgment declaring a trust in part of such fund in favor of plaintiff, both parties appeal. Affirmed.

The opinion of Mr. Justice GAYNOR at special term is as follows: That Mrs. Cadman intended to make a gift to the plaintiff of the money standing to her credit in this bank is unquestionable. She so told the treasurer of the bank, and advised with him. It was his suggestion that the gift might be made by not putting the money in the name of the plaintiff, in the bank, but by putting it in the name of Mr. Cadman as trustee of the plaintiff, and Mrs. Cadman acquiesced in the suggestion. She had no intention of making a gift to her husband of the money, and what she said when transferring the account to his name, as trustee for the plaintiff, at the bank, does not prove that she had, even if it were competent to so prove. There was, at all events, a valid gift to the plaintiff of the money BIrs. Cadman had on deposit. Mr. Cadman expressed an intention of controlling it during his life, when the account was being transferred to him as trustee. This might evince that he was to be trustee for life; or that he desired to control the fund, but it does not prove that Mrs. Cadman was not making an absolute gift; for that was her intention, as I find upon the evidence. But, as to the deposits made to this trust account afterwards by Mr. Cadman, I think the intention to control, expressed by Mr. Cadman at the time of opening the account, governs them. The cases treat the question of the gift as one of the intention. Willis v. Smyth, 91 N. Y. 297 ; Blabie v. Bailey, 95 N. Y. 206 . And I find, so far as these deposits were concerned, the intention of BIr. Cadman was that they were not to be an absolute gift, but to remain subject to his control. This appears from what he said when he opened the account, and, while that does not affect the gift of Mrs. Cadman, was, though so intended, also to apply to any moneys of his own which he should afterwards deposit to that account, and it did so apply. Also, the moneys deposited after the account was changed to be in trust for Alfred J. Cadman do not belong to the plaintiff. Let findings be prepared accordingly.