John Edson Brady.

Bank deposits : trust deposits, alternate deposits, joint deposits : a full statement of the general principles of law governing these forms of deposits. Digests of all cases involving such deposits which have been decided by the Courts of the different States. Complete text of the statutes regulati online

. (page 6 of 24)
Online LibraryJohn Edson BradyBank deposits : trust deposits, alternate deposits, joint deposits : a full statement of the general principles of law governing these forms of deposits. Digests of all cases involving such deposits which have been decided by the Courts of the different States. Complete text of the statutes regulati → online text (page 6 of 24)
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administrator claimed that estates by the entirety had
been abolished, in effect, by the enactment of the married
women's statutes which, in a property sense, disunite
husband and wife. But the court held that estates
by the entirety still exist in Missouri, as at common

As to the nature of an estate by the entirety, it is an
interest in property owned jointly by a husband and wife,
which on the death of one, passes to the survivor. Estates
of this character are not recognized in all of the states.
Where it does exist a conveyance to a husband and wife
creates an estate in entirety. But in some states such


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an estate is not created unless expressly stated in the

In the present case it was held that whether the deposit
by the husband created an estate by the entirety depended
upon the intention of the depositor. The mere opening of
the deposit, it was said, was not conclusive, but had a
favorable bearing on the question in the wife's favor. It
was held that the circumstances justified the presumption
that the husband, in making the deposit, intended that his
wife, if she survived him, should have the entire deposit.
The administrator of the wife was accordingly adjudged
entitled as against the husband's administrator.^^^

§ 29. Right of bank to pay joint and alternate
deposits. — During the life time of both parties to a joint
or alternate deposit, the bank may pay either party in
accordance with the rules of the bank, imless there is
different stipulation in the contact of deposit. And
where the deposit is in such form that the survivor is
entitled to the deposit the bank may pay the survivor.
But, if the bank pays after notice by one of the parties,
or some one representing one of the parties, not to pay, it
pays at its own risk and if the bank in such case pays a
party not legally entitled, it may be compelled to pay over
again at the instance of one properly entitled."* «

However, the fact that a bank is protected in paying in

113. Craig v. Bradley, (Mo., 1911), 134 S. W. Rep. 1081. See
also Parry's Estate, (1898), 188 Pa. St. 33, 41 Atl. Rep. 448.

114. Metropolitan Savings Bank v. Murphy, (1896); 82 Md.
314, 33 Atl. Rep. 640; Mulcahy v. Devlin, (N. Y. 1886), 2 City Ct.
Rep. 218; Whitlock v. Bowery Savings Bank, N. Y. Daily Reg.,
Nov. 22, 1883; Grafing v. Irving Savings Institution, (1902),
69 N. Y. App. Div. 566, 75 N. Y. Supp. 48.


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good faith, under the circumstances stated, does not mean
that the party so paid is necessarily entitled to retain
the money. His rights depend upon the rules governing
these deposits already set forth.

In a number of states there are statutes, the general
purport of which is that a bank may pay a deposit, stand-
ing in two names, to either person, whether the other be
living or not."^

115. For tho text of all statutes, see Appendix B.


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Airanged alphabetically with reference to jurisdictions.


A IN Trust for B.

Sayre v. Weil, (1891), 94 Ala. 466, 10 So. Rep. 546.

A deposit by A in trust for B, intending the deposit as a
gift to B creates an irrevocable trust. Rights of bank dis-

An account was opened with a bank, entitled " D.
Weil, trustee for the Goldman children," the same being
the grandchildren of the depositor. He testified: " I
put it there as a gift to them every week so that when they
grew up they would have something to fall back on."
He subsequently directed the bank to apply to the de-
posit to the payment of a note of his which the bank held.

As to the rights of the parties the Court said: " Under
all the authorities we hold that the trust was completed
and irrevocable, and that nothing remained in the trustee
but a mere naked legal title. We hold the law to be,
that a deposit is a matter of contract between the de-
positor and the bank. * * * We further hold that if
D. Weil as trustee had drawn against this fund in his trust
character, Moses Brothers (bankers) were under no legal
duty to inquire into the purposes intended, or the use to
be made by the trustee of the money; and if his drafts
were paid in ignorance of any improper use intended by
the trustee, they would not be responsible; that payment
of such drafts would be in due course of banking business


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and would discharge them from liability. When, however
D. Weil proposed to apply this trust money in satisfaction
of his own individual indebtedness, Moses Bros, knew that
the funds were trust funds, and that the proposition
amounted to a violation of his trust. Such an agreement
cannot be upheld against the cestui que trust (beneficiary).
The cestui que trust may afterwards ratify such unauthor-
ized application of the trust fund, and hold Weil responsi-
ble, or they may repudiate the payment in tola and hold
Moses Bros, as their debtors.''


Deposit in A's Name.

Smith wick v. Bank of Corning, (Ark. 1910), 130 S. W.
Rep. 166.

Frequent declarations by a depositor that money on
deposit in his name belongs to another will not convert the
deposit into a trust fund. The mere intention, without
acts, will not create a trust. And the party in whose
favor such declarations are made, cannot recover the
deposit from the bank.



Denigan v. Hibernia Savings & Loan Society, (1899),
127 Cal. 137, 59 Pac. Rep. 389.

A deposit by a wife of her money in an account, payable
to herself or her husband, does not, standing alone, constitute
a valid gift,

Ellen Denigan deposited $1,700, her own money, in
the Hibernia Savings & Loan Society and received a
pass book entitled " Frank Denigan or Ellen Denigan
in account with the Hibernia Savings & Loan Society ".
Later $1,300 more was deposited. Upon Ellen's death


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the husband caused the money to be transferred to a new
account entitled " Francis Denigan or James Denigan/'
James being a nephew of Francis. Later Francis gave
an order for $1,000 to one Connelly. Francis died the
next day and the $1,000 was paid to Connelly after his
death. James, the nephew, presented the pass book
and demanded the entire deposit including the $1,000
paid to Connelly. The administrator of Francis and the
administrator of Ellen also claimed the fund. It was held
that the administrator of Ellen was entitled to the
money. There had never been any valid gift to Francis
and consequently neither he nor James had any claim.
It was not shown that Francis ever had possession of
the bank book until after Ellen's death. " The form in
which the deposit was made was equally consistent with a
desire on the part of the wife to give to her husband author-
ity to withdraw money from the bank from time to time
as she might need it."

A AND B, Payable to Either.

Denigan v. San Francisco Savings Union, (1899),
127 Cal. 142, 59 Pac. Rep. 390.

A deposit by a married woman of her money in the names
of herself and her husband, payable to the order of either of
them, does not, standing alone, give the htisband such a joint
irUerest in the deposit as to entitle him to claim it against the
wife's executor.

Upon the death of one Ellen Denigan there was a
deposit in the San Francisco Savings Union in the names
of herself and her husband, payable to either of them.
The account originated in a single deposit of $3,000 be-
longing to the wife. After the wife's death, Francis Deni-
gan the husband caused the sum of $1,400 to be trans-
ferred to an account entitled " Frank Denigan or James
Denigan." After Frank's death James brought this
action against the bank. The bank paid the money into


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court and the administrator of Frank Denigan was sub-
stituted as defendant. It was held that as the money
belonged to the separate estate of Ellen Denigan at the
time of the original deposit and as there was no evidence
showing an intent on her part to part with title to the
money, it remained her separate property at the time of
her death, notwithstanding the form of the deposit.

The court said: "Title by survivorship exists only
when. the estate is held in joint ownership, a.nd, unless
the deposit was owned by Francis in the lifetime of Ellen
jointly with her, there was no joint interest therein to
which the incident of survivorship could attach. We
have seen that she did not part with her title to the de-
posit by reason of the form in which it was made, and, as
the title of Francis depends entirely thereon, it is evi-
dent that he had no joint interest with her in the moneys
so deposited. * * * While the bajik would have
been authorized to pay all or any portion of it to him
(Francis) in her lifetime he could have been compelled
to account to her for what he might thus receive."

A, Pay to A, B or C.

Booth V. Oakland Bank of Savings, (1898), 122 Cal.
19, 54 Pac. Rep. 370.

A, who had a savings bank account, signed the following
paper: " To Oakland Bank of Savings, May 17, 1892, in
re savings deposit 7041, in my name. Pay to the in-
dividual order of either B, or C, or myself. (Signed) A."
A died still owning part of the deposit, and having re-
tained the bank book with the knowledge of thfe bank.
It was held that the transaction fell short of a gift, but
that it was a trust in favor of B and C. It was unneces-
sary to show an acceptance. The action started by B
and the administrator of C was a sufficient acceptance.
Though revoked as to part of the deposit by subsequent
withdrawals, the trust remained effective as to the balance.


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A Trustee for B.

Minor v. Rogers, Executor, (1873), 40 Conn. 512.

A deposited a sum of money in the name of " A trustee
for B." B was a minor, and A intended, when she made the
deposit, that it should be for the benefit of B, and a few days
after, she informed B's father that she hud put some money
in the savings bank for B, and that he would need it for his
education, A retained the pass book and afterwards drew
out the money. In her will she disposed of all her estate and
made no mention of B or of the deposit, B never knew of the
deposit until after the death of A, In an action by B
against the executor of the estate of A, he was given judgment
for the deposit with interest.

Held: When A made the deposit in the form and with the
intention stated, the beneficial interest immediately vested
in B, A retained merely the bare, legal, title as trustee for B,
The trust was complete when the money was deposited and
A could not thereafter annul the transaction as she attempted
to do.

On March 30, 1861, Mary Daniels, a wealthy widow,
living at Branford and having no children, went to New
Haven with William A. Minor, a boy thirteen years of
age, who resided with his parents, who were near neighbors
and friendly to Mrs. Daniels, and after inquiring par-
ticularly about his middle name, left him in a store with
directions to wait for her. She then visited the New
Haven Savings Bank (where at the time and for a year
or two kfter, she had no deposit except the one now to be
mentioned) and deposited in the bank $250, receiving the
usual bank book made out to

" Mary Daniels as trustee of William A. Minor."

The semi-annual interest was afterwards added upon
the book up to January 1863, and again up to January


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On June 15, 1863, she drew out $150 of the money and
on the 18th of May 1864, she drew out $130.15 the balance
of principal and interest then due, signed a receipt in
the book in her own name, without the addition of trustee,
and then delivered up the book to the bank. The book
up to that time had always been retained in her own
possession. In her will she disposed of all her estate mak-
ing no mention of William A. Minor, or of the deposit.

A few days after the deposit, she informed the father
of William that she had deposited $250 in the savings
bank for Willie and on two other occasions during the
same summer she alluded to the fact in conversation with
Willie's parents, and that he would need it for his educa-

William A. Minor knew nothing of the deposit until after
the death of Mary Daniels which occurred in 1868, and
no further allusion was made to it between her and his
parents during her life. It did not appear for what pur-
pose she drew the money out or what she did with it.

This suit was brought by William A. Minor against the
executor of Mary Daniels to recover the money with

The executor claimed that upon the facts there was no
effective gift; that in law Mrs. Daniels had, notwithstand-
ing the deposit, the right to revoke her intended bounty,
and that by withdrawing the deposit in her own name,
she must be deemed to have revoked it so that it never
became effective.

Held: Mrs. Daniels deposited $250 fer the sole benefit of
the plaintiff intending thereby to vest in plaintiff all
the beneficial interest in the deposit. Within a few days
after, she informed plaintiff's father of what she had done
for the plaintiff, and remarked that he would need the
donation to acquire an education. But she made the
deposit in her own name as trustee for the plaintiff and
kept the bank book in her possession, and this gives rise


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to all the doubt there is in the case, namely, whether the
gift was consummated or not.

It is evident that she did all that she thought was
necessary to be done to perfect the gift and supposed that
she had accomplished the object; and the only question
is whether she was successful. If she had made the
deposit in the name of the plaintiff alone, or had made
some other person than herself trustee for the plaintiff,
no question could have arisen regarding the completeness
of the gift. But the beneficial interest is as much given
as it would have been if either of these modes had been
adopted. The deposit is made in bank for the plaintiff
and the bank is informed of the fact. Here is a delivery
of the beneficial interest. No more would have been
done if the deposit had been made in the name of a third
party for the plaintiff. The trustee in that case would
have had nothing more than the bare, naked, legal title,
without any beneficial interest whatsoever. That in-
terest would have vested directly in the plaintiff. Can
it be said that Mrs. Daniels retained in her possession
anything more — anything but the naked, legal title,
when all the beneficial interest had been as completely
given and delivered to the plaintiff as it could have been
if a third party had been made trustee? Suppose she
had given the plaintiff a writing to this effect: " I, Mary
Daniels, have this day deposited in the New Haven
Savings Bank $250, in my name as trustee for William
A. Minor," would the case be stronger than it is now?
She substantially so declared to the bank when she made
the deposit, expecting they would make a record of it for
the benefit of plaintiff, which they did make. She sub-
stantially so declared to the father and natural guardian
of the plaintiff, a short time after, expecting, no doubt,
that he would inform the plaintiff of what she had done
for him.

It is true that a mere naked promise to give personal


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property, or a declaration by a party without performing
some act delivering or conveying the property to the
donee, would not be sufficient. But here the donor took
a sum of money and deposited it in a bank where she had
no funds of her own, for the purpose of transferring all
of the beneficial interest in the same to the plaintiff,
and although she used her own name as trustee for the
plaintiff, still the act had the same effect as depositing
it in the plaintiff's name, in every respect except the legal
title. Surely here are acts done for the purpose of trans-
ferring the beneficial interest in the chose in action to the

If the deposit had been made in the name of the donor
alone, then it would have been necessary in order to
perfect the gift, for her to have given the plaintiff a writing
conveying the gift, or an assignment of the bank book in
which the deposit was entered.

But here the conveyance was made of the chose in
action at the time the deposit was made, and it so appears
on the books of the bank, and in the donor's bank book,
which entries she caused to be made at the time of the

But the defendant relies very much upon the fact that
Mrs. Daniels retained possession of the bank book.
He considers this act of hers as wholly inconsistent with a
perfected gift. But she could not act as trustee of the
chose in action without retaining possession of the book,
for it is well known that savings banks require the pre-
sentation of such books whenever any action on their
part is asked for with regard to the deposits in the banks.
She retained possession, therefore, because the deposit
was made in her name as trustee, and not because she
had not given the beneficial interest of the deposit to the

We think, therefore, that the gift of Mrs. Daniels to the
plaintiff was complete when the money was deposited


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in bank and that consequently she could not thereafter
annul the transaction as she attempted to do.

The defendant further claims that her trust was void
for uncertainty, because no time was specified when the
plaintiff should enjoy the legal as well as the equitable
right to the property. The donor stated that the plaintiff
would need the donation for his education, thereby im-
plying that it should be in his hands for that purpose
when that time should arrive. At all events it cannot
be considered that she intended the trusteeship to con-
tinue longer than during the minority of the plaintiff.
We see no difficulty in this objection.

B: C. Guardian.

Kerrigan v. Rautigan, (1875), 43 Conn. 17.

A deposited a sum of money in the name of " B, C
guardian," informing C that she had put the money in bank
for B. A, however, kept the book and afterwards caused
the money to be transferred back to her own name. Later
she transferred the deposit to an account " B, A trustee"
A always kept the bank book, until a few days before her
death when she handed it to C, telling her that it was B's
money; but at A*8 request, the bank book was again returned
to her, and she had the account transferred to her own name;
and then retransferred to " D, trustee,** with directions to
the latter to pay her debts, funeral expenses, and purchase a
gravestone. A died, leaving no estate except the deposit.
Thereafter " D, trustee ** drew out the money, and paid most
of it out for A's funeral expenses and debts.

Afterwards, B claiming that the deposit was given her,
brought suit against D therefor.

Held: At the time of the first deposit, A intended to make a
valid gift thereof to B, and the making of the deposit in the
name of " B, C guardian,** taking the book in the name
of the donee, and notifying the guardian of the act, gave
effect to that intention, made the gift complete, and placed


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it beyond the power of A to revoke it. Hence the deposit
belonged to B, and D trustee who withdrew the same and paid
it away as directed by A, is liable for the amount to B,
after deducting the sum of one debt which he paid, which
existed before the gift to B, and with the payment of which the
deposit in B's hands would be rightfully chargeable.

On August 30, 1869, Elizabeth Williams, a sister of
Margaret Kerrigan, and Aunt of Elizabeth Kerrigan, a
minor, deposited in the Chelsea Savings Bank of Norwich,
$460, in the name and to the credit of

" Elizabeth Kerrigan — Margaret Kerrigan, guardian,"
and received the usual pass book. At the time she told
Margaret that she had put the money in the bank for
Elizabeth Kerrigan, but did not deliver the book either to
Margaret or to Elizabeth Kerrigan.

On October 29, 1869, Elizabeth Williams drew from
the bank $10 of the money so deposited and caused the
remainder to be transferred back to her by Margaret
Kerrigan and took out a book for the same in her own

On September 20, 1870 she deposited $37.75 in this
account. From August 30, 1869 to November 2, 1870
interest on the deposits to the amount of $26.25 accrued;
but between those dates Elizabeth Williams drew out
$114 leaving a balance to her credit on November 2,
1870 of $400 which was on that day, by her direction,
placed to the credit of

" Elizabeth Kerrigan — Elizabeth Williams, trustee."

From November 2, 1870 to March 19, 1872 the ac-
count was not changed except by the credit of $35.78
earnings and $23.78 withdrawn by Elizabeth Williams.
Elizabeth WilliMis never delivered to Margaret Kerrigan
nor to Elizabeth Kerrigan the bank book taken out on
August 30, 1869 and always held the book taken out
November 2, 1870 until a few days before she died. She
then placed it in the hands of Margaret, telling her to


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take care of it and that it was Elizabeth Kerrigan's
money. But at her request it was retiuned to her soon
afterwards and she then, on March 19, 1872 transferred
the balance of $412 to herself and received from the
bank a deposit book for that sum in her own name. On
March 20, 1872 she drew out $12 and on March 22, 1872
transferred the remainder, $400 to "John Rautigan,
trustee " and directed him to appropriate the money for
the payment of her debts and funeral charges and for a
gravestone. A few days afterwards she died leaving no
estate unless the said sum of $400 belonged to her.

Elizabeth Williams was illiterate being unable to read
or write. Elizabeth Kerrigan had been named for her.
At the time she made the first deposit on August 30, 1869
she intended to give the deposit to Elizabeth Kerrigan.

After her death, John Rautigan trustee, drew the $400
from the bank and paid her funeral expenses amounting
to $122.75 and debts then outstanding against her amount-
ing to $204.06. This amount included an indebtedness to
F. P. Rochford for $91.75 which existed at the time the
first deposit was made,, at which time Elizabeth Williams
had no property to pay this debt with except the money so
deposited. The remaining indebtedness had been subse-
quently contracted.

After paying these debts and funeral expenses, Rautigan
took out letters of administration upon the estate of
Elizabeth Williams. Thereafter this suit was brought
against him by Elizabeth Kerrigan to recover the sum of
$400 and judgment is awarded in her favor for $308.30,
being the amount drawn from the bank by Rautigan less
the amount of the Rochford debt and the interest thereon
from March 30, 1872.

Held: The intention on the part of Elizabeth Williams
to make a valid and perfect gift to the plaintiff, her niece,
on August 30, 1869 of the sum of $460 is found by the
court below; and as a matter of law, the deposit of that


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sum on that day in the savings bank in the name and to
the credit of plaintiff under the guardianship of Margaret
Kerrigan, the taking of the usual bank book for that
deposit in the name of the donee, and the accompanying
notice of the act to the guardian, gave effect to that in-
tention, made the gift complete, and placed it beyond the
power of revocation of the donor.

But the defendant denies the validity of the gift and
asserts that the pecuniary condition of the donor at the
time when it was made was such as to render it fraudulent
and void against existing and subsequent creditors.

It is to be noted that no representative of a debt existing
at the time of the gift is heard to call it in question. The
debt to Rochford, the only one outstanding, has been paid
from the money given to the plaintiff; it was in fact paid
before the institution of this suit, and the judgment of
the court below charges it upon this fund. In the ab-
sence of any fraudulent intent on the part of the donor,
this payment from the money given is legally equivalent
to a reservation in favor of the debt, and the transfer of
the money to the plaintiff. Under these circumstances
the bare fact of the existence of the debt at the date
of the gift should not operate to nullify it for the sole
benefit of subsequent creditors.

Although the donor reserved no money in hand when

Online LibraryJohn Edson BradyBank deposits : trust deposits, alternate deposits, joint deposits : a full statement of the general principles of law governing these forms of deposits. Digests of all cases involving such deposits which have been decided by the Courts of the different States. Complete text of the statutes regulati → online text (page 6 of 24)