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Essentials of donatio mortis
DONATIO MORTIS CAUSÂ (1).
A Donatio mortis causâ is a gift of personal property "by a party who is in peril of death, upon condition, that it shall presently belong to the donee, in case the donor shall die, but not otherwise."
There are three essentials to the validity of a donatio mortis causâ :
1. The gift must be with a view to the donor's death.
2. There must be an express or implied intention that the gift should only take effect on the donor's decease by his then existing disorder.
3. There must be delivery of the subject matter of the donation to the donee or some one on his behalf. The delivery must be absolute, i.e. the donor must not retain any control over the property, but it may be accompanied by a trust.
A donatio mortis causâ has been described by Mr. Story "as an amphibious gift between a gift inter vivos and a legacy" (2). It resembles a legacy and differs from a gift inter vivos in the following respects: (1.) It is "ambulatory" and incomplete during the donor's life. It may be revoked by resumption or by the recovery of the donor from the same illness. It cannot, however, be revoked by a subsequent will, though it may be satisfied by a legacy. (2.) It may be made to the wife of the donor. (3.) It is subject to probate duty, and legacy duty. (4.) It is liable for debts on deficiency of assets.
A donatio mortis causâ, on the other hand, differs from a legacy in the following respects: (1.) It does not require probate, as it takes effect at once sub modo (i.e. conditionally), though as was pointed out it is now liable to probate duty (3). (2.) It
(1) It has been recently decided that although the Common Law Divisions have jurisdiction to entertain an action to establish a donatio mortis causâ, even where the legal right has not passed to the donee; yet in such a case the action is more
properly instituted in the Chancery Division: Cassidy v. Belfast Banking Co., 22 L. R. Ir. 68.
(2) Story's Equity Jurisprudence, 584.
(3) 44 & 45 Vict. c. 12, s. 38 (2), and see sects. 27, et seq.
requires no assent from the executor or administrator to perfect the donee's title.
Under the Customs and Inland Revenue Act, 1881 (1), the Customs personal or movable property to be included in an account, Revenue and thus rendered liable to the duties payable on affidavits Acts. in England and Ireland and inventories in Scotland, on probate and letters of administration, is to comprise "any property taken as a donatio mortis causâ made by any person dying on or after the 1st of June, 1881.
The Customs and Inland Revenue Act, 1889 (2), amending the Act to which we have just referred renders all property liable to probate duty which is taken as a donatio mortis causâ, or taken under a voluntary disposition made by any person so dying, purporting to operate as an immediate gift inter vivos, whether by way of transfer, delivery, declaration of trust, or otherwise, which shall not have been bona fide made twelve months before the death of the deceased; or taken under a gift whenever made, of which property bona fide possession and enjoyment shall not have been assumed by the donee immediately upon the gift, and thenceforth retained to the entire exclusion of the donor, or of any benefit to him by contract or otherwise.
Donationes mortis causá have been held valid of—
Bills and promissory notes payable to the donor's order, though endorsed by him.
Deposit note given by a bank to the donor.
Keys, as affording the means of obtaining possession of the thing locked up.
Mortgages. Policies of insurance.
Receipts for money.
In a case decided in 1887 (3) it was held that a deposit receipt in the ordinary form used by banks may be the subject of a donatio mortis causâ, and that though the receipt was expressed to be not transferable. It was pointed out that this case was identical with others which are noticed in the judgment, save in the one respect that the receipt contained the words "not transferable," but this point was regarded as immaterial. "The receipt of course," said the judge, was not, and if these words were absent could not have been, negotiable in the sense of
(') 44 & 45 Vict. c. 12, s. 38. () 52 Vict. c. 7, s. 11.
(3) Cassidy v. Belfast Banking Co., 22 L. R. Ir. 68.
Cases where donationes mortis causá held valid and invalid.
conferring upon a transferee by indorsement a better title than that of his transferor. If that was intended to be effected by the words they were useless. If, on the other hand, the words were an attempt on the part of the bank to render the money secured by the receipt inalienable, they were void. The bank could not upon such a contract prevent the money of the deceased in their hands being assignable by him, or in the absence of assignment, passing to his personal representatives." Donationes mortis causá have, on the other hand, failed in respect
Receipts for stock. Cheques on the donor's own bank not presented before his death (1).
A somewhat difficult case on the law of donatio mortis causâ was decided by the Court of Appeal last year. A testator by his will gave the income of his property to his wife in his last illness, and being in anticipation of death he signed the following document:—
"March 1, 1887. I give all my insurance money that is coming to me to my wife Hannah for her own use, as well as £200 in the bank. This is my wish." This document was signed by the husband but attested by only one witness, and was at his request placed with his will and remained there until his death in April, 1887. Evidence was admitted as to the circumstances attending the execution of the document. The Court of Appeal decided, reversing the decision of the Court of first instance, that the document was intended as a testamentary instrument, and not having been properly attested according to the Wills Act, could not take effect as a will, and also that effect could not be given to it as a donatio mortis causâ or as an immediate assignment of the property mentioned in it (2).
The Court of Appeal, in delivering judgment said, "the document is, on the face of it, testamentary, and not being attested, as required by law, we cannot accept it, or we should be doing away with the Wills Act altogether. It has been argued that the gift, or so-called gift, may operate as a donatio mortis causá ; but this argument cannot succeed. If a chattel or a deposit note be handed over by a person in contemplation of death, so as to confer a complete title on the donee, there may be a good
(') See further on this subject In re Mead. Austin v. Mead, 15 Ch. D. 65, where most of the previous cases are collected; Clement v. Cheesman, 27 Ch. D. 631; Williams on Executors, 8th ed., p. 776, et seq.,
Brett's Leading Cases in Equity,
donatio mortis causá. But the subject of this alleged gift was not properly one, the evidence of title to which property passes by delivery, to which property alone, speaking generally, the doctrine of donatio mortis causâ applies" (1).
(1) See also Re Dillon. Duffin v. Duffin, 44 Ch. D. 77.
Rights of a surety in
The law with regard to the subject of suretyship has already been to some extent considered in that portion of this work which is devoted to contracts (ante, p. 375). A brief further notice of it on this subject would seem, however, to find its appropriate place in that portion of our work which is devoted to the principles of equity. In several points which now possess practically nothing more than an historical interest, the doctrines administered by the Court of Equity in respect of matters of suretyship, differed essentially from those administered by courts of common law (1).
Prior to the Judicature Act, however, the rules of equity had in very many cases been adopted in the common law courts, and now in all cases of conflict between the two systems, the rules of equity are to prevail.
What are the rights of a surety in respect of the disclosure to him of matters affecting the contract? The law on this disclosure. subject was very carefully considered in a case which came before Lord Justice (then Mr. Justice) Fry in 1878. law on that point," said the judge, "seems to me to stand very much in this position. Where parties are contracting with one another, each may, unless there be a duty to disclose, observe silence even in regard to facts which he believes would be operative upon the mind of the other, and it rests upon those who say that there was a duty to disclose, to shew that the duty existed. Now undoubtedly that duty does in many cases exist." It exists, the judge proceeded to state, where there is the relationship of agent and principal, solicitor and client, trustee and cestui que trust, and there are also contracts which are uberrimæ fidei, e.g., partnership, marine insurance, &c.
"It has been argued," continued Fry, J., "that the contract between the surety and the creditor, is one of those contracts which I have spoken of as being uberrimæ fidei, and it has been
(1) See for a summary of the differences between the rules of law and
equity, Smith's Principles of Equity, 2nd ed. p. 345.