Alfred Blumenthal and Hannah Blumenthal, his wife, were the owners as tenants by the entirety of the premises known as Nos. 503-505 West One Hundred and Eleventh street in the borongh of Manhattan, city of New York. They sold the premises, taking back from the purchaser a bond and mortgage executed to Alfred Blumenthal and Hannah Blumenthal, his wife. Thereafter and while the said Alfred Blumenthal and his wife were still the owners and holders of said bond and mortgage, Alfred Blumenthal died on or about the 12th day of June, 1921, and Hannah, his wife, died shortly thereafter on or about the 24th day of June, 1921. It is said that both died as the result of injuries sustained in a railroad accident in Spain.
A question has arisen regarding the ownership of this purchase-money bond and mortgage. If the bond and mortgage are to be treated as a substitute for the real estate and as being held by the parties like an estate by *Page 451 the entirety or in joint tenancy, then Hannah Blumenthal as the survivor and her estate since her death is the sole owner of the securities and entitled to possession thereof. On the other hand, if the bond and mortgage are to be treated like any other bond and mortgage, the execution of the bond and mortgage to Alfred Blumenthal and Hannah Blumenthal, his wife, amounted to an ownership in common and each owned one-half of the amount of the security. Upon the death of either the half would pass to his or her estate. There was no mention in the bond and mortgage that the security was to be held in joint tenancy.
The executors of Hannah Blumenthal's estate brought proceedings before the surrogate against the executors of Alfred Blumenthal's estate to compel them to turn over to the petitioners the bond and mortgage, claiming that Hannah as survivor was the sole owner thereof. The learned surrogate and the Appellate Division, on appeal, were of the opinion that the petitioners were right and cited Matter of Kennedy (186 App. Div. 188, third department). This is an authority on the point as it was there decided that a purchase-money mortgage arising from the sale of real estate owned by the husband and wife as tenants by the entirety takes the place of the real estate, and presumptively on the death of either mortgagee passes to the survivor as the real estate which it replaced would have done. Matter of Baum (121 App. Div. 496, second department) is an authority the other way, for it was there decided that when husband and wife being tenants by the entirety, convey land and take back a purchase-money mortgage payable to both, the survivor is not entitled to the whole proceeds of the mortgage. The courts below were of the opinion that the second department had later reconsidered this conclusion in West v. McCullough (123 App. Div. 846; affd., 194 N.Y. 518). The two cases were dissimilar in principle. The Baum case was an estate by the entirety, later changed *Page 452 into a mortgage in the names of husband and wife. It did not appear who had purchased the property or that the husband had ever been the sole owner of it at any time. The very opening sentence of the McCullough case shows the difference. "When George W. McCullough changed the savings bank account to the names of himself and wife he had controlling authority for believing that that act evidenced an intention on his part to benefit his wife to the extent of a right of survivorship in said fund, and that nothing remained to be done to effectuate that intention." (p. 847) Here is the point of difference and the point of the case.
The intention of the husband is the thing to be looked for. When he takes the title out of his own name and shares it with his wife, it has been said that this evidences an intention that she shall take by survivorship. (See cases cited in KennedyCase, supra.) The presumption does not apply to one not a wife. (Matter of Bolin, 136 N.Y. 177.) But how can we discover any such intention when we do not know who owned or paid for the property in the first place? Such an instance was touched upon correctly by the late Mr. Justice BURR in Matter of Kaupper (141 App. Div. 54, 57). "In the absence of direct evidence as to the intent, the law deals with presumptions. It has been held that if the husband and wife each contribute to a joint investment, or to the purchase of a security, and the title is taken in their joint names to be held by them, their executors, administrators or assigns, no presumption arises from the nature of the act that either intended to make a gift of his or her share to the survivor, and they would hold the same as tenants in common. On the other hand, where a husband purchases with his own funds personal property, taking the title thereto in the joint name of himself and his wife, or makes a deposit in the savings bank of his own funds in their joint names, in the absence of other evidence the presumption will be that he intended to confer upon his *Page 453 wife the right of survivorship. * * * Where it does not appear to whom the money belonged when it was placed in the bank, or who placed it there, although the bank book may be in the joint name of husband and wife, in the absence of other evidence of intent the presumption will obtain that each had an equal interest therein. (Wetherow v. Lord, 41 App. Div. 413.)"
So in this case of the estate by the entirety, the real estate was sold, the estate ended and in its place we find a purchase-money mortgage in the name of husband and wife without knowing whose money it represents. The furthest a reasonable presumption will carry us is that each owns one-half. This is just what the statute says.
Section 66 of the Real Property Law (Consol. Laws, ch. 50) reads: "Every estate granted or devised to two or more persons in their own right shall be a tenancy in common, unless expressly declared to be in joint tenancy; but every estate, vested in executors or trustees as such, shall be held by them in joint tenancy." This applies also to personal property. (Matter ofKimberly, 150 N.Y. 90.) There was no mention of a joint tenancy in the mortgage, the grant being "to Alfred Blumenthal and Hannah Blumenthal, his wife." To say that "the mortgage took the place of the real estate," as was said in the Kennedy case, is merely to jump at a conclusion. Such could be said about a mortgage given in part payment if it covered other property than that sold or could likewise be said about any security given in payment. True it would take the place of the real estate as a possession of like value but not necessarily of like ownership. Estates by entirety are peculiar to real estate. No such thing exists, except by analogy, as to personal property. (Matter ofAlbrecht, 136 N.Y. 91; Matter of McKelway, 221 N.Y. 15.)
The real property which Alfred Blumenthal and Hannah Blumenthal, his wife, owned, was deeded away by them. It was sold. It was conveyed by a deed passing title in *Page 454 fee. By the deed all the interest which Blumenthal and his wife had in the real property completely passed out of it. Their interest in the real property ceased to exist. Their tenancy by the entirety came to an end. They took back as part of the purchase price a bond and mortgage. That the mortgage given to secure the bond happened to be a purchase-money mortgage or a mortgage upon the property which they had conveyed is a mere incident. They might have taken a mortgage upon any other piece of property. The ownership which they had in the bond and mortgage was not dependent upon the piece of property that was given as security but upon the wording of the instrument. A mortgage is merely a chose in action and personal property. (Matter of Albrecht, 136 N.Y. 91.) The bond was the principal debt. The mortgage was merely security. It granted the property upon the terms and conditions stated in the mortgage, "to Alfred Blumenthal and Hannah Blumenthal, his wife."
This is all we have. There is nothing else to indicate the intention of the parties except these words. Under these circumstances the bond and mortgage were held in common and the husband and wife had an equal share or ownership therein.
The orders of the Appellate Division and the surrogate must be reversed and the petition dismissed, with costs.