Reese v. Philadelphia Trust, Safe Deposit & Insurance , 218 Pa. 150 ( 1907 )

Opinion by

Mr. Justice Stewart,

If the legal effect and consequence of the transaction between Mrs. Pomeroy and her nephew, William K. Reese, the appellant, are at all obscure, it is not because the transaction itself in any of its features is uncertain or equivocal. It is claimed that what subsequently occurred between the parties show's a purpose in the mind of Mrs. Pomeroy the very opposite of that indicated by the transaction, and a corresponding understanding by the nephew. The learned judge before whom the case was heard derived from the transaction a valid and effective gift of the securities in question. He was overruled in this by the court in banc, and this appeal results. The facts are undisputed, and may be briefly stated.

Mrs. Anna K. Pomeroy was a widow of advanced age and childless. Her nearest kindred were the appellant, a nephew and his three sisters, two of whom are among the appellees. For the appellant, who had resided with her from childhood, she entertained special affection, treating him as a son. On August 1, 1904, the aunt and nephew together went to the Philadelphia Trust, Safe Deposit & Insurance Company, where the former had a rented safe or box in which she kept certain securities. While they were together in the room of the directors of the company she took out the box, and having placed it on a table called into the room Mr. Scholey, an officer of the company. She told Mr. Scholey that she was giving to her nephew the box and contents, and that she wished him to witness the gift. She was then seated at the table where the box was; some of the securities were still in the box, while others were out upon the table. Mr. Scholey examined the securities sufficiently to see their general character, and told Mrs. Pomeroy that inasmuch as some -were registered and some were coupon bonds, something more was necessary to complete the gift, and inquired whether he should send someone in to prepare powers of attorney for her to execute. He accordingly sent into the room Mr. Pierce, a clerk in the bank, with blank powers of attorney which were there signed by Mrs. Pomeroy and witnessed by Pierce. Among the securities were the certificates and bonds which are the subject of the present controversy. These were (1) two stock certificates issued by the Pennsylvania Railroad Company, one for twenty and one for three shares ; (2) three stock certificates issued by the Lehigh Coal & Navigation Company, one for three, one for four and one for thirty-one shares, and (3) five mortgaged bonds of the Philadelphia & Reading Railroad Company, each of the denomination of $1,000. Assignments of these several securities in blank, with like blank powers of attorney empowering the attorney to sell, assign and transfer the same for assignee’s use, were then and there signed by Mrs. Pomeroy and duly attested. These assignments were in the usual form, and had the effect to make the securities marketable without anything further. This being done, the box from which the securities had been produced, being Mrs. Pomeroy’s, was surrendered, and the securities were placed in a box or safe that had been that day rented by the nephew. The latter being about to return -to California, as part of the same transaction, constituted in writing on the records of the trust company Mrs. Pomeroy, as his deputy, "with authority expressed as follows : “ To have access to my safe at all times, with the same powers that I could have if personally present.” This ended the transaction. None of the securities were transferred on the books of the company, but with the powers of attorney executed as above Reese was in position to have this done at any time before the death of Mrs. Pomeroy, which occurred August 25, 1905. After Mrs. Pomeroy’s death, appellant presented the above-mentioned securities, with the powers of attorney attached, to the several companies that had issued them, and requested transfers to be made. This was declined because of Mrs. Pomeroy’s death.- He then demanded of the executors that they execute new transfers. This demand being refused, he filed the bill in the present proceeding to require the executors to make the necessary transfers. The proceeding resulted in the dismissal of plaintiff’s bill. This brief statement discloses the one question in the case — can a valid, effective, irrevocable gilt of these particular securities to the nephew be derived from what took place between Mrs. Pomeroy and the appellant on the occasion referred to ?

To constitute a valid gift inter vivos two essential elements must combine: an intention to make the gift then and there, and such an actual or constructive delivery at the same time to the donee as divests the donor of all dominion over the subject, and invests the donee therewith. We do not understand that the sufficiency of the delivery of these securities to the donee, if an immediate and irrevocable gift was intended, is questioned. They were placed, if not by the hands of the donor, by one she directed, in the box of the donee, which, notwithstanding the donor thereafter had access to it, was the donee’s own exclusive property for the time being, which neither the donor nor anyone else could interfere with excépt as allowed by him. This delivery was quite as unequivocal and pronounced as it would have been had the securities been placed in the donee’s hand or pocket, and therefore just as effective. With respect to the donor’s intention as to the kind and measure of the gift she intended to make, if regard be had to her previous expression of purpose, to what passed between the parties, and what occurred at the time of the inaking of the gift, and to these alone, there can be but one conclusion. What was there done, whatever its effect, was in fulfillment of a purpose the donor had previously expressed to several of her intimate friends. She had again and again avowed her purpose to turn over to her nephew the securities in her box. Her purpose as expressed to Mr. Scholey, whom she had called in to witness the transaction, was to make a gift to her nephew of the contents of the box. The testimony of this witness was: “She said she was giving Mr. Reese the box and its contents, and would like me to act as a witness to the gift.” In nothing that was said or done was there a suggestion of any qualification or restriction with respect to the gift. Wha.t therefore occurred on the occasion while both parties were present, is not only consistent with a purpose to make an immediate and irrevocable gift, but inconsistent with any other. "When her attention was called to what was necessary to make the gift effective, that is to say, powers of attorney to transfer the securities, she immediately executed them. The surrender of her own box to the trust company, and the placing of the securities made marketable by her blank transfers in the box rented by the nephew, which immediately followed, completed the transaction. Confining the inquiry to the immediate occurrence, can there be any question as to the legal effect of the transaction? There is present in the case a clearly expressed purpose to make a present gift, followed by a sufficient delivery. Thus every requirement is met, and were we to stop the inquiry here, the gift would have to be sustained. It was because the court below extended the inquiry, and allowed what subsequently occurred to overcome the plain and obvious intendment of what was said and done when the gift was made, that a conclusion adverse to the plaintiff was reached. The evidence on this branch of the case was admitted for the purpose of showing that the parties themselves understood the transaction as meaning something different from that indicated by the plain and natural meaning of their words and acts at the time. It is perfectly competent to show this, since the effort of the law always is to develop and give effect to the real purpose of the parties; but too great latitude was here allowed, and evidence was introduced which in no aspect can be considered as indicating a common and mutual understanding and purpose, but simply a purpose by the donor inconsistent with the facts of the transaction. It is never permitted a donor to impeach his gift; therefore what was said or done by Mrs. Pomeroy, unassociated with her donee and unassented to by him, is wholly irrelevant to the issue and cannot be considered. The court below placed much emphasis on the fact that Mrs. Pomeroy had at a later period inquired of an officer of the bank whether the power of attorney she had given “ would put matters in proper shape so that if anything should happen to her Mr. Reese could transfer the securities.” This inquiry may reflect some light on her understanding of the effect of the original transaction; but on its face the transaction was an executed gift in the donee, and it is wholly immaterial, limiting this inquiry to what is pertinent to the issue, what either thought in regard to it, except as the other is shown to have had the same understanding. The only relevant evidence on this branch of the case was that which related to the conduct of the parties with reference to the subject-matter. True, this was confined principally to the acts of Mrs. Pomeroy, but since these extended to at least a qualified control of the securities, and the actual conversion of a part, the knowledge and assent of the donee might be inferred in connection therewith. Immediately following the transfer of the securities the nephew returned to California. Mrs. Pomeroy, who had been deputized by him to have access to the safe, remained until November 10 of the same year, when she too went to California. Before removing she took from the safe Reading bonds to the amount of $3,000 and sold them. She also collected certain coupons, and left authority with the trust company to collect others as they matured, the proceeds to be credited on her account. Alter she had removed to California, she instructed the company to subscribe for an allotment of four shares of Lehigh Coal & Navigation stock. On her return to Philadelphia in June, 1905, the authority she had given to the trust company was canceled. To allow this evidence the effect contended for, too much would have to be supplied; as it stands, it is wholly inadequate to the purpose. The selling of the $3,000 of bonds may very well have been within the implied power of the deputization, or in consequence of direct instructions from the principal. The burden in such case is upon the party setting up the fact relied upon to overcome the natural and obvious meaning of the transaction. This burden was not discharged so long as what Mrs. Pomeroy did with the proceeds of the sale of the bonds was left unexplained. She was a deputy in custody of the securities, and the presumption is that if she converted any of them, it was in the course of her agency, and that she fully accounted for them. The law will not presume the contrary. As much may be said with respect to the coupons and dividends collected by her and carried to her credit in the bank. Giving these facts the utmost significance that can be claimed for them by the appellees, they are at least equivocal; if they may be regarded as indicating a continued ownership of the securities in Mrs. Pomeroy, with quite equal reason they may be referred to the agency she was invested. To allow such uncertain and ambiguous circumstances to defeat what the conduct of the parties in connection with the immediate transaction shows to have been intended as an absolute gift, is to misapprehend the true force and significance of the evidence.

The decree of the court below is reversed; the plaintiff’s bill is reinstated, and it is now ordered that a decree be entered directing an injunction mandatory in form to the Philadelphia Trust, Safe Deposit & Insurance Company, executor of the will of Anna E. Pomeroy, deceased, requiring it to sign as such executor such powers of attorney as may be required to transfer to William E. Reese the said recited securities. The cost of this proceeding to be paid by the executor of the will of Anna E. Pomeroy, deceased.