Smith v. SmithAnnotate this Case
120 S.E.2d 575 (1961)
255 N.C. 152
Cassie Lee SMITH v. Charlie H. SMITH, Peoples Savings & Loan Association of Wilmington, N. C., and First Citizens Bank & Trust Co. of Clinton, N. C.
Supreme Court of North Carolina.
June 16, 1961.
*578 Clark, Clark & Grady, Elizabethtown, for plaintiff, appellant.
Hester & Hester, Elizabethtown, for defendant, appellee.
Plaintiff excepts to the signing of the judgment and contends that, upon the facts admitted and stipulated, she is entitled to one-half of the deposits in question.
The deposit in the First-Citizens Bank and Trust Company is in the name of "Charles H. Smith or Cassie Smith."
Under the laws in this jurisdiction, nothing else appearing, money in the bank to the joint credit of husband and wife belongs one-half to the husband and one-half to the wife. Bowling v. Bowling, 243 N.C. 515, 519, 91 S.E.2d 176; Smith v. Smith, 190 N.C. 764, 767, 130 S.E. 614; Turlington v. Lucas, 186 N.C. 283, 290, 119 S.E. 366.
But in the absence of evidence to the contrary the person making a deposit in a bank is deemed to be the owner of the fund. If a husband deposits his own money in a bank and the money is entered upon the records of the bank in the name of the husband or his wife, it is still the property of the husband, nothing else appearing. Hall v. Hall, 235 N.C. 711, 714, 71 S.E.2d 471; Nannie v. Pollard, 205 N.C. 362, 171 S.E. 341; Jones v. Fullbright, 197 N.C. 274, 277, 148 S.E. 229; Thomas v. Houston, 181 N.C. 91, 93, 106 S.E. 466.
Such deposit does not constitute a gift to the wife. To make a gift inter vivos there must be an intention to give coupled with a delivery of, and loss of dominion over, the property given, on the part of the donor. Donor must divest himself of all right and title to, and control of, the gift. Such gift cannot be made to take place in the future. The transaction must show a completely executed transfer to the donee of the present right to the property and the possession. Buffaloe v. Barnes, 226 N.C. 313, 318, 38 S.E.2d 222; Nannie v. Pollard, supra; Thomas v. Houston, supra. When a husband deposits his money in the name of husband or wife, this fact taken alone does not necessarily indicate an intent to make a gift to the wife. It may, indeed, be only for the convenience of the husband. Furthermore, he does not thereby divest himself of dominion over the fund. He may withdraw any or all of it at any time. "The delivery of the deposit book for such an account is not sufficient to meet the formal *579 requirements for a gift." 14 N.C.Law Rev. 133, and cases there cited (N. 23).
When a husband deposits his money in this manner he merely constitutes the wife his agent with authority to withdraw funds from the account, and the agency is terminated by death of the husband. (See cases cited in the second paragraph next above.) The agency may be terminated during the lives of husband and wife by withdrawal of the fund and closing the account by the husband, notice to the agent and the bank, or by other methods recognized by law for termination of the principal and agent relation. Annotation, 161 A.L.R., Joint DepositPowers as to, pp. 71-95; Zollmann Banks and Banking (Perm.Ed.), Vol. 5, s. 3231, p. 250; Cashman v. Mason, D.C., 72 F. Supp. 487, 491.
In the instant case defendant husband was the owner of a 51-acre farm at the time he married plaintiff. The funds in the deposits in question "were various incomes derived from the aforesaid farm." The only withdrawals from the account in the First-Citizens Bank and Trust Company were by the husband.
The income and profits from a farm owned by the husband are his sole and separate property. The husband has the duty to provide necessaries for his wife and must support and maintain her in accordance with his means and station in life. North Carolina has no community property law. The domestic services of a wife, while living with her husband, are presumed to be gratuitous, and the performance of work and labor beyond the scope of her usual household and marital duties, in the absence of a special contract, is also presumed to be gratuitous. Sprinkle v. Ponder, 233 N.C. 312, 318, 64 S.E.2d 171. Furthermore, where husband and wife own land by the entireties, the husband has the right to the full control of such property and to the income therefrom to the exclusion of the wife. Porter v. Citizens Bank of Warrentown, Inc., 251 N.C. 573, 577, 111 S.E.2d 904.
Here, defendant owned the farm and the profits from the farm were his separate property. The facts stipulated and admitted do not disclose which of the parties actually made the deposit in the bank. Even so, it was stipulated that the fund so deposited was derived from the operation of the farm. This being so, it is clear that the deposit is the property of defendant husband, and the entry "Charles H. Smith or Cassie Smith" did not constitute a gift to plaintiff wife but merely made her an agent of the defendant with authority to withdraw funds from the account so long as the agency remained in effect.
At the time the deposit was made in the Peoples Savings and Loan Association plaintiff and defendant executed an agreement in writing with respect thereto. It is presumed that the agreement was in accordance with a form required or furnished by the Association and it appears that it was primarily for the protection of the Association.
By contract and agreement between husband and wife, either oral or written, a husband may vest in the wife ownership or a property right in all or a portion of a joint bank account, including the right of survivorship, at the time the deposit is made. Wilson County v. Wooten, 251 N.C. 667, 669, 111 S.E.2d 875; Bowling v. Bowling, supra; Jones v. Waldroup, 217 N.C. 178, 7 S.E.2d 366. See also Comastri v. Burke, 1955, 137 Cal. App. 2d 430, 290 P.2d 663, 666; Arsenault v. Arsenault, 1958, 337 Mass. 189, 148 N.E.2d 662, 665. In some situations North Carolina recognizes third party contracts. Canestrino v. Powell, 231 N.C. 190, 56 S.E.2d 566. But this Court has not recognized transactions between bank and depositor to a joint account as contracts enforceable in favor of the named alternate. Jones v. Waldroup, supra; 35 N.C.Law Rev. 80, 81.
The case at bar does not involve survivorship rights. Husband and wife are both living.
*580 As to the Association deposit, the inquiry is whether or not the agreement executed by plaintiff and defendant at the time the deposit was made was sufficient to vest in the plaintiff wife any ownership of, or property right in, the funds so deposited. If not, this deposit is subject to the rules of law applicable to the bank deposit already discussed, and the husband is the owner and entitled to the possession of the fund.
We have carefully examined the terms of the agreement and we find nothing to indicate that the defendant recognized the ownership and title of the plaintiff in and to the fund or any part thereof, or that he undertook to vest in her any title or ownership. It merely says that the deposit "shall be for the use and benefit of us both." It does not create a trust; the facts stipulated and agreed are insufficient to show an intent to create a trust. Walker v. Welsh, Mass.1837, 11 N.E. 727. The words "use and benefit" when construed in context mean nothing more than the right to withdraw and that the manner of use after withdrawal shall not be the basis of an action against the Association. The agreement in the Wilson County case used the words "* * * all funds now, or hereafter, deposited * * * shall be our joint property and owned by us * * *" [251 N.C. 667, 111 S.E.2d 876]; and in the Bowling case the words "in the joint names of the undersigned as joint tenants * * *." [243 N.C. 515, 91 S.E.2d 178.] The agreement signed by plaintiff and defendant does not conform to the suggested form of agreement in G.S. § 41-2.1, and this statute has no application. In any event the agreement was executed and the deposit made prior to the passage of this statute.
Under the law in this jurisdiction, defendant is the owner and entitled to the possession of the deposits in question.
The judgment below is