RICAUD v. WILMINGTON SAVINGS & TRUST CO. et al., 70 F. 424

SIMONTQH, Circuit Judge (after stating the facts). This question depends upon the construction of the transaction in April, May, and June, 1888, whereby the stock standing in the name of James Dawson was transferred inf.o the name of William Hildreth Field, executor. By the will of Missouri g. Dawson, lie was her executor. By operation of law, eo instanti, upon Ms qualification as executor of Missouri g. Dawson, he became the executor of Janies Dawson, of whom she was executrix. He swears that when the transfer was made to him, as executor, by his direction, he meant executor of Missouri S.

Dawson, and this was also the understanding of Asa K. Walker, the corresponding clerk and general assistant in the bank,, who kept the stock account and made the transfer. So his purpose, made known by him to the proper officer of the bank, was to transfer the certificates of stock from the name of James Dawson to himself, as executor of Missouri S. Dawson. The transfer was made. How .was it made? As the certificates stood in the name of James Dawson, t:hey were transferable only by him in person or by his attorney. Upon his death the transfer could be made only by his personal representative or his attorney.

Ho legatee under the will could make such transfer, or authorize such transfer. When, therefore, the transfer was made, as in fact it was made, it could only have been done by Field, who was in law the executor of James Dawson. As such executor, he had this authority, — no one else liad such authority, —and he exercised it, and, only because of such exercise, the bank could and did make the transfer. The bank could not say that the transfer was made under the authority of the executor of Missouri 18. Dawson, for as such executor he had no such authority.

The bank would be estopped from denying that the transfer was by the proper representative of James Dawson, and in this the receiver is affected by the same estoppel. It must lie remembered that no well-founded suspicion can exist that this transfer in 1888 was intended to defeat any creditor of the bank, or to avoid liability as a stockholder. At That time, and for three years afterwards, the bank was in credit, and no fear of its insolvency existed. Up to a very short time before its failure, gentlemen of sound judgment, members of the bar of high standing, purchased shares in it.

So, whatever may have been the motive or purpose of this transfer, such motive or purpose could not have been to defeat the creditors of the bank, and in that alone has the complainant any interest. This being so, as Die bank would be estopped by the .transíer, its receiver is. It is said, however, that Missouri g. Dawson was'simply a life tenant; that she left no estate; that her directions to her executor to make a trust capital of $30,000 from the personalty, and realty of her estate were idle words, and his execution of her directions idle acts. Missouri S.

Dawson did by her will attempt to dispose of this real and personal property. Her testator left no debts unpaid, except perhaps to his daughter, Fannie. She herself had none. The only persons who could. complain of her action were her son and this daughter, the only distributees of her husband and testator. They did not complain, indeed they acquiesced, and Fannie Pollock, the survivor, in her answer recognizes the right of her mother so to dispose of her personalty. This family arrangement, in the absence of fraud, will not be disturbed.

It may be that because of certain unhappy conditions in the family, glimpses of which appear in the testimony, both mother and daughter approved of these dispositions, to protect the latter from the extravagance and importunity of her husband. But, if this be so, it is something of which the receiver cannot complain, for it was no fraud on him, or the creditors he represents.

In any event, Field was an active, living executor, a person, in the law, capable of taking, and if the stock standing in the name of James Dawson was transferred to him in his name and character as executor, it is passed out of the estate of James Dawson into his hands as executor of Missouri S. Dawson. The transfer, when thus consummated, destroyed the relation of membership between the corporation and James Dawson and his estate, with all its incidents, and created an original relation with the transferee, the executor of Missouri S. Dawson. National Bank v. Watsontown Bank, 105 U. S. at page 222.

On the failure of the bank, three years afterwards, neither James Dawson nor his estate were shareholders, and so not liable to the assessment. ■ One other point of view suggests itself. At the failure of the bank the stock stood in the name of “William Hildreth Field, executor.” Of whom.? It had been in the name of James Dawson up to 1888. Parol evidence would be admitted to show who was the owner. Turnbull v. Payson, 95 U. S. 418. Now, the evidence is that Field intended to transfer that stock to himself, as executor of Missouri S.

Dawson, and that after the transfer he held it as such executor, and with it carried out a part of the purpose of his testatrix, and the bank officer, transferring the stock, knew that he was taking it as the executor of Missouri S. Dawson. This testimony is not contradicted. The conclusion, therefore, cannot be resisted that the transfer was made in 1888, and thenceforward the estate of James Dawson ceased to hold the legal title to the stock, and its corresponding liability also ceased. Bank v. Case, 99 U. S., at page 631; Whitney v. Butler, 118 U. S. 655, 7 Sup. Ct. 61.

It may be discussed from yet another standpoint. Mrs. Fannie Pollock, the daughter of James Dawson, and his sole surviving heir, during her father’s lifetime married one Charles E. G-reenough. He died, leaving her a legacy of $50,000, absolutely, with some other property contingent on her continual widowhood. She gave to her father the check for the $50,000, and he drew and received the money, passing it to his own credit in bank.

She testifies that this was a •loan to her father, and that he paid her interest during his life; that upon his death, she having in the meanwhile married Pollock, she received from her mother $20,000, leaving $30,000 unpaid; that her husband spent the $20,000, and that her mother refused to pay the rest, fearing that it would meet the same fate. The provision made in her will as to the trust fund of $30,000 was made as a payment of this debt. The whole transaction has been challenged by the complainant, and strong suspicions of fraud are alleged.

But there is her sworn testimony, with that of Field, her mother’s adviser, the existence and production of the check indorsed to and by her father, and evidently carried to his credit. There never is a presumption of a gift by a child to its parent, especially when the parent is in no heed." There is not a particle of evidence going to show that this was not a loan. Nor is the mode provided for its repayment so absurd or abnormal as to raise conclusive doubts regarding it. .Mrs. Pollock had received and had lost ■ $20,000 of the $50,000. Her mother wanted to secure the remainder. She was out of debt.

Her husband’s estate owed nothing but this. So she, - exercising the very large control given her in the will, secured a -fund of $30,000 for her daughter, as a mode of refunding the money which James Dawson had received from her. Carrying out the instructions of his testatrix, Field transferred the stock to himself, as executor, and held it as part of the trust fund. This was all done in 1888. There cannot be any reasonable suspicion that it was done in contemplation of the failure of the bank. Who could complain of it? The husband of Sirs. Pollock might have done so.

He could have exercised his marital right, and reduced into possession this chose in action of his wife. The record discloses no effort by him to this end, and no complaint or protest. Pollock and Ms wife were divorced in April, 1890. Thenceforward she was discovert and sui juris’. She never objected to the action of the executor. This being so, Field, the executor of both estates, transferred to himself, as. executor of Missouri S.

Dawson, and held, as trustee, under the instruction of his testatrix, this stock in the national bank, thus liquidating a debt of James Dawson, in whose name, up to that time, the stock stood. Thenceforth the name of James Dawson disappeared from the books of the bank, and on its failure, in 3891, neither he nor his estate were shareholders. The decree of the circuit court dismissing the bill is affirmed.