In re Estate of Szabo

New York Court of Appeals · 1961 · Property

Propertygiftsdeliverypresent intentjoint bank accountinter vivos giftstock transferdelivery

Facts

Before her death, decedent owned 122 shares of American Telephone & Telegraph stock, and a 3-for-1 stock split was to take effect, with new certificates to be issued after her death. On April 27, 1959, after receiving notice of the split, she executed an assignment to herself and petitioner as joint tenants on the back of one certificate representing 50 shares and instructed her niece to have petitioner's name put on all of her stock. She also directed that the transfer be delayed until the new certificate was available. The transfer on the company's books was not made until after decedent died.

Issue

Whether decedent completed a valid inter vivos gift of any interest in the stock to petitioner so that he became owner as surviving joint tenant, despite the fact that the transfer on the corporation's books was not made until after decedent's death.

Rule

A valid inter vivos gift requires donor intent to give, delivery pursuant to that intent, and acceptance by the donee. The required delivery must vest the donee with control and dominion over the property, and where only a part interest in stock certificates is being transferred, symbolic delivery is adequate only when the transfer is recorded on the corporation's books; until then, the donor retains power to revoke and has not surrendered dominion and control.

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In Buffalo, Nora Levin owned 300 shares in Pine Harbor Utilities, represented by a single certificate. She signed an assignment transferring a 60-share joint tenancy interest to her brother, Eli Levin, and mailed the certificate and instructions to the corporation's transfer office, which recorded the transfer on its books two days before Nora died.

Did Eli receive a valid inter vivos gift of the 60-share interest?

Explanation. A valid inter vivos gift requires intent, delivery, and acceptance. For a gift of a part interest in stock represented by a certificate the donor retains, symbolic delivery is sufficient, but it becomes complete only when the transfer is entered on the corporation's books. Once that record transfer occurred during Nora's lifetime, she passed the point of no return and surrendered dominion over the transferred interest.