177 N.E. 481

BENDER v. THE CLEVELAND TRUST CO.

Court of Appeals of Ohio.
Decided March 24, 1930.

Banks and banking — Withdrawal of deposits — Present gift in wife not created by husband changing passbook — Insufficient evidence of husband’s intention when transferring savings account.

1. That husband had passbook changed to permit wife to withdraw money from bank held not sufficient to constitute present gift of fund.

2. Evidence respecting husband’s intention at time of transferring savings account to names of both husband and wife did not establish gift of fund.

APPEAL: Court of Appeals for Cuyahoga county.

Mr. Winfield Worline and Mr. Paul Howland, for plaintiff.

Messrs. Dustin, McKeehan, Merrick, Arter Stewart, for defendant.

RICHARDS, J.

This case involves the ownership of a fund deposited with the Cleveland Trust Company amounting to $14,112.23, besides interest thereon. The plaintiff is the widow of David Bender, and claims the fund by gift from him. The Cleveland Trust Company was appointed executor of his last will and testament, and on interpleader was substituted as defendant, and as executor filed an answer claiming the fund. While the action originally involved also a claim to recover $2,000 withdrawn from the trust company by the plaintiff and claimed by the defendant as executor, yet the defendant does not now make claim to recover that sum.

David Bender opened a savings account about the

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year 1891 in a bank subsequently merged with the Cleveland Trust Company, and from the time of the opening of that account maintained a substantial deposit, as represented by his passbook carried in his individual name. In the year 1913 he married the plaintiff, Josephine, and about 1924 he went to the banking house of the Cleveland Trust Company, and through an arrangement made with one of its officers had the passbook so changed that the amount deposited was made payable to “David Bender or Josephine Bender, either may draw,” and it seems from the evidence that the passbook was left with the trust company as a matter of convenience, for the reason that it had to be presented whenever a withdrawal was made. His intent in making this change becomes of vital importance, it being contended by the plaintiff that she was given equal dominion over the fund with the right to withdraw part or all, and having withdrawn all of the fund before his death, she contends that it was a completed gift and became her property. The trust company, as executor, contends that the change made in the passbook was a mere matter of convenience, and that she became merely the agent of David Bender with a right of withdrawal only, and not an owner.

The material facts are not in serious controversy. At the time the passbook was changed, David Bender was 84 years of age, quite feeble and nearly blind, and it was difficult for him, on account of traffic conditions, to go to the trust company alone. He did, however, come and have a conference with one of the officials, Mr. P.C. Johnson, who testifies on this subject as follows:

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“Q. It was your statement that Mr. Bender said the account was to be transferred to their joint names for convenience? A. Mr. Bender told me that he was putting Mrs. Bender’s name on that for convenience only in withdrawing funds. In other words, it was his desire to limit the withdrawals at that time and we would not accept her signature with limited authority.

“Q. You told him that? A. Yes.

“Q. So you took it with absolute authority for either. You would not put limitations on? A. Exactly.”

Later in his testimony, in response to an inquiry, he answered: “He simply said he wanted it on because it was so inconvenient for him and inconvenient and dangerous for him to come to the office.”

The passbook was thereupon changed, as indicated, and shortly thereafter the trust company secured the signature of Mrs. Bender on the identification card. The amount represented by the passbook was at that time substantially $13,000, all of which was his money. His business relations with the bank were thereafter the same as they had been theretofore. He drew occasional checks, as needed, and the trust company paid for him from the fund such taxes as he might be owing. On February 1, 1926, some two years after the change, he withdrew $2,000 from the fund, and gave it to the plaintiff to place in a separate deposit account which she had in her own name. There is no evidence that she ever withdrew any money from the joint fund until after he became seriously ill.

About two weeks before her husband’s death, she requested an official of the company to come to the

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home, which he did, and she informed him that she was considering withdrawing the entire fund and placing it in her own individual name. He informed her that he supposed she had the legal right to withdraw it, but that he thought it was an improper thing for her to do, and that, if she did so, he would inform Mr. Bender of the circumstances, in case he recovered. In that conversation she made no claim of any right to the fund other than might follow from the transaction which occurred at the time the passbook was changed, and stated that she probably would not make the withdrawal. Shortly after that, on January 31, 1928, she withdrew $2,000 from the fund, and on February 6, 1928, she withdrew the entire balance of $14,112.23. It does not appear what she did with the $2,000, but the amount of the final withdrawal she deposited as a part of the same transaction in her own name in another branch of the Cleveland Trust Company, and this fund the company refuses to pay to her. One week after this final withdrawal, David Bender died testate, leaving plaintiff as his widow, and leaving also children by a former wife.

On October 15, 1927, he executed his last will and testament, item second of which reads as follows: “I give and bequeath to my wife, Josephine Bender, the sum of Seven Thousand Dollars. I direct that my executor hereinafter named to permit her the use and enjoyment of the real estate now used by me and her as a residence, for a period of one year after my decease, after which time, the Executor is directed to sell said residence and its furnishings. I am making no further distribution to my said wife for the reason that I have made transfers to her during

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my lifetime amounting in the aggregate to approximately Seven Thousand Dollars.”

The will bequeaths to a granddaughter the sum of $500, and gives the remainder of his property equally to his three sons. At the time the will was executed, the balance remaining in the joint account was approximately $15,600. David Bender had theretofore given her $2,000, as already stated, and had transferred to her an interest in an $8,000 mortgage.

What, under these facts, are the rights of the parties? It is very significant that neither the indorsement on the passbook nor the card contains language giving the survivor any right to the deposit; the language being such as to give to each party the right of withdrawal only. The great majority of the reported cases appear to be those where the survivor was given the right to the entire fund, and the law applicable to that kind of a case is announced in Cleveland Trust Co. v. Scobie, Admr., 114 Ohio St. 241, 151 N.E. 373, 48 A.L.R., 182. The syllabus in that case indicates the rule of law where the indorsement contains a survivorship clause, and the evidence shows that the depositor intended to transfer to the person to whom he made the account jointly payable a present joint interest equal to his own; the holding being in such case that, the authority to withdraw being unrevoked at death, the survivor is entitled to the balance of the account. An interesting discussion on the questions here involved may be found in a decision of the Court of Appeals of this county in the case of Schmitt, Admx., v. Schmitt, post, 219, 177 N.E. 478, 28 O.L.R., 522. Unquestionably the rights of the parties depend upon whether the intention of David Bender

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was to create a joint interest and ownership in his wife in the fund represented by the passbook, or to make her his agent or representative for convenience in drawing the money, and that is to be determined by what was said and done at the time the change was made in the identification card and the passbook. Skillman, Exr., v. Wiegand, 54 N.J. Eq. 198, 33 A. 929. Certainly the mere fact alone of having the passbook changed so as to permit Josephine Bender to withdraw money from the bank would not be sufficient to constitute a present gift of the fund. Schippers, Exrx., v. Kempkes, (N.J. Err. App.) 67 A. 74, 12 L.R.A. (N.S.), 355; Commercial Trust Co. v. White, 99 N.J. Eq. 119, 132 A. 761; Coburn v. Shilling, Admr., 138 Md. 177, 113 A. 761; In re Bolin, Admx., 136 N.Y. 177, 32 N.E. 626. The books contain almost innumerable cases determining the rights of parties under slightly varying circumstances, and, after all, the ultimate question is: What was the intent of the owner of the passbook in having the change made?

David Bender had been failing in health for some time, and had retired from business many years before the change in the passbook was made, and the evidence leaves no room for doubt that this change was made because of his increasing infirmities; his feebleness and his failing eyesight making it nearly impossible for him to personally transact his business with the trust company. His request of the company was, in the first instance, to so fix the passbook as to give his wife a limited right of withdrawal, but the company declining to accede to such request, which would cast on it the burden of keeping account of the extent of withdrawals made by

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her, it was agreed that each should be given the right of unlimited withdrawal. This right of withdrawing the funds, as we look at it, simply fixed the rights of the parties as between David Bender and Josephine Bender on the one hand and the trust company on the other, and did not determine the rights of David Bender and Josephine Bender to the fund after its withdrawal. We are convinced from the evidence that the change in the passbook from “David Bender” to “David Bender or Josephine Bender, either may draw,” was made as a matter of convenience only, and that the evidence does not show that Josephine Bender became the owner of the fund, even though she had the right of withdrawal, and did in fact withdraw the entire fund and redeposit the same in her own name.

For the reasons given, a decree will be entered finding that the defendant as executor is entitled to the fund.

Decree for defendant.

WILLIAMS, J., concurs.

Judges WILLIAMS and RICHARDS, of the Sixth Appellate District, sitting in place of Judges VICKERY, SULLIVAN and LEVINE, of the Eighth Appellate District.

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