Law School Case Brief
Farmers' Loan and Trust Company v. Winthrop - 238 N.Y. 477, 144 N.E. 686 (1924)
There is no occasion to deny that in the setting of other circumstances a power of attorney, authorizing a donee to reduce to possession the subject of a gift, may be significant as evidence of a symbolical delivery. Such effect will be allowed if, apart from the power, there is established an intention that the title of the donor shall be presently divested and presently transferred.
Decedent Helen C. Bostwick created a trust, with the intention of transferring additional sums into the trust. Decedent's death occurred prior to completion of the transfers. The trustee and the remaindermen under the trust and the legatees under the decedent's will advanced competing claims as to the additional sums. The lower court modified and affirmed as modified the report of a referee. Trustee and remainderman filed an appeal.
Was the transaction inchoate or incomplete as a gift?
Upon review, the Court of Appeals of New York held that the gift remained inchoate at the death of the donor. The court found that there was no expression of a purpose to effectuate a present gift. Thus, the court held that the transaction was inchoate or incomplete as a gift and was, accordingly, not sustainable as a trust. The court held, however, that the residuary taxes on the interests of the remainderman were to be borne by the residuary estate. Therefore, the court modified the judgment of the lower court so as to affirm the judgment entered on the report of the referee in respect of the payment of the federal estate taxes, and, as so modified, affirmed.
Access the full text case
Not a Lexis Advance subscriber? Try it out for free.
Be Sure You're Prepared for Class