Jackson v. The Twenty-Third Street Railway Co. — 47 N.Y. Super. Ct. 85

Majority

p. 85

HENRY J. JACKSON, Executor, &c., Respondent, v. THE TWENTY-THIRD STREET RAILWAY CO., Appellant.

Headnote

Gift of stock—w7iat sufficient evidence of, certificate not Tiaving been delivered.

8., the president of defendant, a stock company, bought and paid for thirty shares of its capital stock directing that the same be set aside in the name of Y. The company thereupon gave to Y. its receipt for a certain sum in full payment ’ for thirty shares of its stock, and thereafter on Y.’s order transferred three shares thereof to a third person, and issued to Y. its certificate for the remaining twenty-seven siiares, which certificate was retained by the company. Dividends on the stock were paid to Y. during his life.

Held, that Y.’s executor was entitled to recover the certificate of said twenty-seven shares of stock, &e., from the company; further held, that the above facts show an executed gift of said stock by S. to Y.

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Before Speir and Freedman, JJ.

Decided February 7, 1871.

Appeal" from, a judgment at special term in favor of plaintiff.

The action was to compel the defendant to issue and deliver to the plaintiff a certificate for twenty-seven shares of its capital stock, and for certain dividends thereon. On July 11, 1872, Jacob Sharp, then and at the time of the trial being the president of the defendant company, paid the defendant $2,250, for thirty shares of its capital stock, and directed that the same be set aside in the name of Sidney A. Yoilmans, and the defendant thereupon issued and delivered to "said Youmans its receipt for said sum in full payment for thirty shares of its stock. On May 10, 1873, Youmans gave Sharp a written order on the defendant to transfer three of said thirty shares. Thereafter and before Youmans’ death a certificate for twenty-seven shares was duly issued by the defendant for and in the name of Youmans (with the knowledge of Sharp), which certificate is in the possession of defendant, it never having been delivered to Youmans. Youmans died, and by his will said twenty-seven shares of stock were bequeathed in trust for certain of Youmans’ relatives. Before this action the plaintiff demanded a certificate for said stock and an account and payment of dividends, but the same was refused by defendant. While Youmans lived he collected the dividends on said shares.

The following is the opinion of the court below:

“ Sedgwick, J.—There must be judgment for plaintiff. The legal title to the stock was in the deceased. If the company be at liberty to set up that such legal title was held in trust—take all the testimony, irre

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spective of the legal incompetency of some of it—there is no proof of what the trust was, or that the stock should be discharged from the trust, in favor of Mr. Sharp.

“ The transaction between the deceased and Mr. Sharp, in its most favorable view to defendant, was in substance a gift to the deceased, for there is no competent evidence that the stock was to be returned to-Mr. Sharp.”

Flanagan & Bright, attorneys, and Osborn E. Bright, of counsel, for appellant.

Grey, Stanton & Cass, attorneys, and Henry Stanton, of counsel, for respondent.

The defense is that Youmans never having paid any consideration for the stock, had no legal title to it; that there was no gift, for the reason that there was no delivery.

The transaction, as stated by Mr. Sharp, who was then and had been since the organization of the road, its president, is very plain and simple. He swears that he knew Mr. Youmans, who had married his niece, and Youmans and his wife had adopted a child, in the care of whom t.he witness had a special interest. The niece died and Youmans married again, and his second wife did not continue the care of that child.

With this explanation it is easy to understand what was intended by Sharp and Youmans in this transaction and how far they succeeded in carrying out their intention. -We think the twenty-seven shares of this stock were an executed gift by Mr. Sharp, the president of the company, to Mr. Youmans, for the benefit of his, Sharp’s, niece. The title to the stock was by him voluntarily transferred after he had bought and paid for it, and possession was given to Youmans, who accepted it without any consideration—Youmans paid

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nothing for the stock. A gift, as implied by its definition, must be without consideration. The delivery need not be to the donee; a delivery to a third party to hold for the donee is sufficient. Mr. Sharp paid the defendant the price of the thirty shares of stock, and directed that the stock be set aside in the name of Sidney A. Youmans; and in pursuance of this direction delivered to Youmans its receipt for the sum in full payment of the thirty shares. Sharp applied to Youmans for a written order on the company to transfer three of said shares. The defendant had refused to transfer these three shares unless Sharp procured Youmans’ order permitting the company to transfer them. Thereafter the defendant issued to Youmans a certificate for the twenty-seven shares of the thirty mentioned in the receipt, and he continued to collect the dividends on it during his life. The stock was in the hands of the defendant, but the evidence of title was placed in the hands of Youmans, and there is no evidence that it was to be returned to Sharp.

Youmans undoubtedly held the title to the twenty-seven shares; and the collecting the dividends during his life, with the knowledge of both Sharp and the defendant, is, in addition to the receipt given for the money and the transfer of the certificate, evidence that an executed gift was made to Youmans in trust for the benefit of his first wife, but the character of the trust is not disclosed. The plaintiff, as executor of You-mans, finding this stock among the testator’s assets, brought his action after demand, and we think he is entitled to recover. 1

We think the judgment should be affirmed, with costs.

Freedman, J., concurred.