In re the Appraisal of Estate of Pierce

Kruse, J.:

We agree with the learned surrogate that if these savings bank deposits were mere tentative trusts, revocable by the deceased, the . depositor, during his lifetime, they are taxable under the Transfer Tax Law, although the trust became absolute and irrevocable upon the death of the depositor. The Transfer Tax Law imposes a tax upon th¿ transfer,of property when made in contemplation of the death of .the transferor, or intended to take effect in possession' or enjoyment at or after his death. (Tax Law [Laws of 1896, chap. 908] § 220, as amd. by Laws of 1905, chap. 368.)

It is contended on behalf of the appellants, however, that the trust became irrevocable and effective before the death of the deceased. The rule by which this question must be determined is stated in Matter of Totten (179 N. Y. 112, 125) as follows: “ Á deposit by one person of his own money in his own name as trustee for another, standing alone, does not establish an irrevocable trust during the lifetime of the depositor. It is a tentative trust merely, revocable at will, until the depositor dies or completes the gift in his lifetime by some unequivocal act or declaration, such as delivery of thé pass book or notice to the beneficiary. In case the depositor dies before the beneficiary without revocation, or some decisive act or declaration of disaffirmance, the presumption arises- that an absolute trust was created"as to the balance on hand at the. death of the depositor.”

*467To determine whether the deceased completed the gifts in his lifetime it will be necessary to examine a little further the facts and in so doing it should be kept in mind that the unequivocal act or declaration required to complete the gift is such as delivery of the ( pass book or notice to the beneficiary.

The facts do not seem to be in dispute. It appears that besides the widow the deceased left a daughter thirty-one years of age at the time of his death, and two sons, aged twenty-eight and twenty-four yeai's respectively, at that time. The deceased had a safe deposit box in which were kept the pass books and other securities belonging to him and the members of his family. The deceased and his sons liad keys to the deposit box, but all the members of the family seem to have had access thereto as occasion required.

While the sons occasionally had the bank books I think no such delivery of the pass books was shown, as of itself, unaided by other / acts and declarations of the deceased would make the trust absolute and irrevocable. It appears, however, that the wife and children Were kept informed of the deposits, and the deceased declared to / them his purpose in opening the accounts and making the deposits. He often stated to the children that the funds set apart for them would belong to them at the age of twenty-one years, and told his wife that her funds were hers at the time the trust was made.

The form of the accounts was not changed and the moneys were all left in the banks. The deceased used none of the funds himself, nor did he pay any of the moneys over to his wife and children, and no request was ever made by them that he do so except that shortly before his death the daughter requested that the accounts which had been made in trust for her be transferred to her name. That occurred about the time she was married. Up to that time the deceased and his wife and children had lived together as one family.

Stress is laid upon this request, and the fact that the account was . not transferred as showing that the trust was then of a tentative nature. It seems to me, however, that the conversation as a whole between the father and the daughter does not bear out that claim. She said to her father: “ Father, why could not these accounts made in trust for me in Boston be made over to my name so that I may have them in Bochester near my home ? ” The father answered *468that these accounts were already hers and had been since -she was twenty-one years of age, and that she had better leave them in Boston so that he could take care of them when he took care, of his own accounts. All of the children were then Over twenty-one years of age, and his statement to her that these accounts were, already hers is quite in accord with Ms previous declarations that the moneys so deposited .by him for. the children should belong to them at. the. age.of twenty-one years. There is no evidence to show that;'the deceased ever retracted the declaration winch he made before the children became of age, that, the money should belong to .them when they became of age.

The. mere, fact that these accounts were not changed in form, and k the moneys paid o ver to the children at the age of twenty-oné years, is not, as. it seems to me, a controlling circumstance to show that f the trust was merely tentative. It was quite natural that so long as the children remained at home and were members of the family they should be entirely content to leave -the funds in the form in which they had been deposited; and the sanie may be. said as regards! ■ the moneys deposited for his wife.

The case of Tierney v. Fitzpatrick (122 App. Div. 6.23), relied-on by counsel for. respondent, is distinguishable from this case by the fact that there the proposéd gift, consisting of moneys in a savings bank,, was not to become effective until after the death Of the donor. Here, as has. been seen, the trust became absolute and irrevocable during the- lifetime of the donor.

The order appealed from should be reversed,, with costs, and the order and decree of the surrogate fixing the amount of the taxable estate be. modified- by deducting-therefrom said, trust fund's and reducing the tax accordingly.

All concurred, except McLennan, P. J., and Spring, J., who-dissented in an -opinion by Spring, J.