
    John W. Macy, Trustee, Resp’t, v. David T. Williams et al., Ex’rs, App’lts.
    
      (Supreme Court, General Term, Second Department,
    
    
      Filed February 10, 1890.)
    
    Tbusts—Deposit in bank.
    Defendant's testator opened accounts in two banks, and made deposits which he declared to be in trust for one E. H., and received pass books containing such statement. He subsequently withdrew all the money. Held, that the transaction constituted a valid declaration of trust, and that plaintiff, as substituted trustee, was entitled to recover the amount so withdrawn.
    Appeal from judgment in favor of plaintiff and from order granting an extra allowance.
    
      Sidney S. Harris, for appl’ts; Chas. N. Judson, for resp’t.
   Dykmam, J.

This action is instituted by the plaintiff as trustee of Eleanor Hildick, against the executors of Benjamin L. Guión, deceased.

The trial was before a referee, who found the following facts: Benjamin L. Guión, in his life-time, opened accounts with two banks for savings and made deposits in each which he declared were in trust for Eleanor Hildick, his grand-niece. When such accounts were opened and the deposits made Guión received from each of the banks a pass-book containing a statement that the accounts were with him as trustee for Eleanor Hildick.

After such pass-books were received by Guión he left them for a considerable time, but they were subsequently returned to him and he drew out all the money so deposited during his life-time for his own benefit.

Guión died in March, 1887, and the defendants are the executors of his last will and testament.

The plaintiff has been appointed the trustee of Eleanor Hildick, and he commenced this action against the defendants, as such executors, for the recovery of the money so drawn from the savings banks, upon the theory that they belonged to Eleanor Hildick when they were drawn out by Guión, and that he was her trustee in respect to such funds and received the same in that capacity.

There is no material dispute respecting the facts, and the findings of the referee are well sustained by the testimony.

Upon such facts the conclusion of law of the referee was that the transaction between the banks and Union constituted a valid declaration of trust, and that the plaintiff was entitled to recover the amount drawn from the banks by Uuioh in his life-time.

Judgment was entered upon the report of the referee in favor of the plaintiff, from which the defendants have appealed to this, court.

The testimony in this action developed a case stronger in favor of the plaintiff than the case of Martin v. Funk, 75 N. Y., 134, where it was held that the transaction was a valid and sufficient declaration of trust and passed the title to the deposits, the depositor constituting herself a trustee, and the retention of the passbooks, which were simply the vouchers for the property, must be deemed to have been as trustee and was not inconsistent with the-completeness of the gift.

In the case of Boone v. The Savings Bank, 84 N. Y., 86, the court of appeals, in the ojDinion, said the case of Martin v. Funk determined that the deposit made with the bank constituted the depositor a trustee for the person for whom the deposit was made, and transferred the title to the fund from the depositor as an individual to her as a trustee. It was also said of that case that it, determined that in an action by the beneficiary against the administrator of the trustee and the depositary, the beneficiary was entitled to the delivery of the pass book, and to receive the money from the bank.

It was also said in that case that if the depositor in her life-time-had demanded the money from the bank, and presented the passbook, no claim by the beneficiary having been interposed, the bank would have been bound to pay, and it was further said in. that case that, upon the death of the depositor, her rights as trustee-devolved upon her administrators.

These principles so enunciated seem to be decisive of this case upon the merits. When the depositor Union drew out the funds-in question he received the same as trustee of Eleanor Hildick, to-whom they belonged, and held them in that capacity, and upon his death his rights and liabilities as such trustee devolved upon his executors, and as he was under legal obligations to account to her for such fund in his life-time, so his executors are now liable to account to her after his death. Union in his life-time held the-fund as trustee for the plaintiff, and the defendants hold it in the: same capacity.

We conclude, therefore, that the trust and the trust relations-were fully established, and the plaintiff is entitled to recover.

In respect to the capacity of the trustee to sue, we have little-trouble. He is the trustee of the beneficiary, with her assent, and. the action is prosecuted for her benefit, with her knowledge and consent, and the defendants stand in no danger of a second, recovery.

There may have been no necessity for the appointment of a new" trustee, inasmuch as the money belonged to Eleanor Hildick, and. if it should now be deemed necessary, the whole proceedings can be amended on this appeal by striking out the name of the trustee, and making the beneficiary the sole plaintiff.

We conclude, however, that the allowance of costs to the plaintiff was erroneous. The defendants were not allowed sufficient time to consider the claim before the action was commenced, and cannot be said to have unreasonably resisted the claim or the offer to refer.

The judgment should be modified by striking out the costs and allowance, and, as so modified, affirmed, without costs of this appeal.

Barnard, P. J., and Pratt, J., concur.  