The learned Appellate Division, with a divided court, has determined both questions of law involved in the above questions in favor of the plaintiff.
The plaintiff, Mary L. Johnson, and the defendants (other than the defendant Ida M. Cole, the wife of the defendant Charles S. Cole) are the only children and heirs at law of Lucia A. Cole, who died intestate, leaving the real estate which is the subject of this action in partition. The intestate was also the owner of personal property of the value of $5,500.00 over and above her debts and the expenses of administration.
The intestate transfered in her lifetime to her children certain property, and the question was litigated before the referee whether these transfers were an absolute gift or an advancement that could be charged against the share of a child in the final distribution of the estate. The children of the intestate offered to show by her declarations, made some time after these *Page 367 transfers, that they were gifts and not advancements. The referee refused to admit these declarations, and the first question presented to us is whether they were competent and does the exclusion of them present reversible error.
We have been cited to no case in this court where the question has been decided. The courts in the various states have divided on this question, and there is authority in the decisions of several jurisdictions in favor of admitting these declarations. In a number of the states these transfers of property to children in the lifetime of a parent are required to be evidenced by a writing showing whether they are gifts or advancements. We regard such legislation as very desirable and as safeguarding the interests of all parties connected with such transfers of property. We consider the admission of such declarations as fraught with great danger and opening the door for fraudulent evidence tending to defeat the intention of parents who can no longer be heard in their own behalf. We do not intimate that any such fraudulent intention is disclosed in this case, but apply our remarks to the general situation.
It is, of course, unfortunate that by the enforcement of this rule absolute gifts may have to yield to the presumption that such transfers of property are deemed advancements. If the situation presented requires a remedy, the appeal should be made to the legislature and not to the courts.
We, therefore, answer the first question in the negative.
The second question arises out of the following facts: During the lifetime of the intestate, Chester A. Cole, her husband, and also the father of the defendant, Emma J. Owen, called upon his daughter and presented her with a certificate of deposit for $500. The material question growing out of this transaction is whether Chester A. Cole, in presenting the certificate of deposit to his daughter, acted as the agent of his wife or for himself as principal.
The daughter took the stand in her own behalf and testified as follows: "The talk between me and my father, when he gave me the certificate of deposit was, he said, well Emma *Page 368 you are away behind. He says, I have not done anything much for you, and he said here is a little something, and I took it, and when I saw how much it was I was delighted and thanked him for it."
At a subsequent hearing, Charles Owen, the husband of Emma, testified: "I remember the time when Mr. Cole delivered to my wife a certificate of deposit for $500. That was about a year or such a matter before his death, I think in 1892, somewhere along there. It was delivered to her at her house where we live, the Paddock place. When he gave it to her, he came and handed it to her and said, `Here is something for you, I have never given you anything, and I want to make you a present of this, and I want you to understand it is from me and has nothing to do with your mother.'"
Thereafter the defendant, Emma J. Owen, again took the stand and was asked this question: "At the time your father, Chester A. Cole, gave you the certificate of deposit for $500, did he say to you that this was a present from him and had nothing to do with your mother?" Objected to by plaintiff. Objection sustained and defendant excepted.
While the ground of this objection now insisted upon was not spread upon the record, it is presented by the form of the second question submitted for answer.
The respondent seeks to justify the exclusion of this evidence on the ground that declarations of an agent are not competent to charge a principal upon proof merely that the relation of principal and agent existed at the time when the declarations were made; something more must be shown. It must further appear that the agent, at the time the declarations were made, was engaged in executing the authority conferred upon him, and that the declarations related to and were connected with the business then depending, so that they constituted a part of the resgestæ. It is argued that if Chester A. Cole was acting as his wife's agent, these declarations were outside of his agency, or, as in this case disclaiming the agency, were not competent but were mere hearsay and could not bind Mrs. Cole or her estate. If he was not acting as agent for *Page 369 his wife, but on his own account, then his declarations to his daughter were immaterial and hearsay.
The one question involved in this phase of the case was whether Chester A. Cole was acting in his own behalf or as agent of his wife. It follows that whatever occurred at the interview, when he handed the certificate of deposit to his daughter, is material as a part of the res gestæ. The principle of agency invoked by the respondent has no application to the situation here presented.
We are, therefore, of opinion that it was competent for the defendant, Emma J. Owen, to prove what Chester A. Cole said at the time of delivering to her the certificate of deposit. Also, that the exclusion of such evidence was reversible error.
We, therefore, answer the second question in the affirmative.
The judgment appealed from and the interlocutory judgment entered upon the report of the referee should be reversed, with costs to the appellants in all the courts to abide the event.
PARKER, Ch. J., O'BRIEN, HAIGHT, VANN, CULLEN and WERNER, JJ., concur.
Judgment reversed, etc.