Young v. Cockman

Delaplaine, J., delivered the opinion of the Court. Hattie Mae Cockman, widow, of Baltimore, in a suit for discovery, specific performance and injunction against Barbara E. Young, of New York, and McCormick & Company, a body corporate, alleges in her bill ²⁴⁸ of complaint (1) that she married James A. Cockman in July, 1939, but they became estranged and for a long time lived apart; (2) that in September, 1940, her husband,, ill and requiring nursing, promised he would give her property valued at §6,000 if she would take him back in her home; and on February 18, 1941, in fulfillment of that promise, he and Mrs. Young, his daughter by a previous marriage, joint owners of 60 shares of preferred stock of McCormick & Company, assigned the certificate for the shares, valued at §6,000, to himself and complainant, and was advised by his attorney that the certificate should be taken to the corporation for registration, and he stated he was feeling too ill to go there at the time but would do so as soon as he felt able; (3) that complainant nursed and cared for him until June, 1941, when his health was such that he was unable to remain at her home, and he died in North Carolina on April 27, 1942; (4) that she did not take legal action to force him to register the transfer because of his ill health and the assurance of his daughter that she would see that the transfer was registered; and (5) that the certificate has been lost, but the daughter refuses to give her consent to registration of the transfer. The bill prays that defendants disclose the location of the certificate; that the stock be declared the property of complainant and a new certificate be issued in her name; and that defendants be enjoined from making any different transfer and from issuing any certificate for the shares to others. Mrs. Young filed a demurrer to the entire bill, and from an order overruling her demurrer she brings this appeal.

Under the Maryland statute, an appeal is allowed from any final decree, or order in the nature of a final decree, passed by a court of equity. Code, 1939, Article 5, Section 30. When the defendant files a demurrer to the entire bill, he challenges the jurisdiction of the court or denies that the bill states such a case as he can lawfully be required to answer and defend. The purport of such a demurrer is a denial that complainant ²⁴⁹ has any right to bring defendant into court on the case presented.

When the chancellor rules thereon, he finally settles a disputed right of the parties as far as he can possibly do so. If the demurrer is sustained, complainant can appeal since the right to proceed with his case is finally settled against him. If the demurrer is overruled, defendant can appeal since the decision finally determines the right of complainant to proceed with the case stated in the bill, and imposes upon defendants the necessity of making his defense. Very often it is desireable to settle the question conclusively by means of an appeal before the costs of trial are incurred.

We reaffirm the rule that an order either sustaining or overruling a demurrer to an entire bill of complaint is not an interlocutory order but an order in the nature of a final decree, from which an appeal lies. Chappell v. Funk, 57 Md. 465 ; Hyattsville v. Smith, 105 Md. 318 , 66 A. 44 ; Darcey v. Bayne, 105 Md. 365 , 66 A. 434 ; Peoples v. Ault, 117 Md. 631, 636 , 84 A. 60 ; Hendrickson v. Standard Oil Co., 126 Md. 577, 583 , 95 A. 153 ; Harlan v. Lee, 177 Md. 437 , 9 A. 2d 839 . This construction of the statute was applied in the opinion, but not in the order denying reargument, in Applestein v. Royal Realty Corporation, 181 Md. 171 , 28 A. 2d 830 . The basic issue on this appeal is whether the bill of complaint alleges a transfer of title to the stock.

In 1872 the Court of Appeals declared that a transfer of shares of stock from an assignor passes his entire interest therein, and the assignee becomes entitled thereto before the assignment is registered on the books of the corporation. Baltimore City Passenger Ry. Co. v. Sewell, 35 Md. 238, 252 , 6 Am. Rep. 402 .

Similarly, the Uniform Stock Transfer Act, passed by the Legislature of Maryland in 1910, provides that title to a certificate and the shares represented thereby can be transferred by delivery of the certificate endorsed by the owner of the shares, although the charter or by-laws of the corporation and the certificate itself provide that the stock ²⁵⁰ shall be transferred only on the books of the corporation or by registrar or transfer agent. Acts of 1910, Chap. 73; Code, 1939, Art. 23, Sec. 55. It is admitted in this case that the certificate was endorsed in the usual and proper manner. It is disputed that there was a delivery.

The word “delivery” is defined by the Act as “voluntary transfer of possession from one person to another.” Code, Art. 23, Sec. 75. Hence, the decisive question is whether there was a transfer of possession from Cockman and daughter to Cockman and wife. The controversy evidently arose from the fact that the certificate was in the possession of Cockman both before and after the assignment. But it must be kept in mind (1) that the assignment was by joint tenants to other joint tenants; and (2) that the word “person,” as used in the Uniform Stock Transfer Act, includes “two or more persons having a joint or common interest.” Code, Art. 23, Sec. 75.

According to the definition in the Act, the transfer alleged in the bill of complaint was, in effect, from one person to another. The Act is so construed as to effectuate its general purpose to make uniform the law of those States which enact it. Code, Art. 23, Sec. 72; Jenkins v. Continental Trust Co., 150 Md. 416 , 133 A. 610 . Possibly Mrs. Cockman could show that, after Mrs. Young has possession of the certificate while endorsing it, she presented it to her father, thereby making a manual tradition.

But that would not be absolutely necessary, for manual tradition is not always essential for an effectual delivery. Buchwald v„ Buchwald, 175 Md. 115, 120 , 199 A. 800, 803 . Delivery may be constructive, rather than actual, provided that it is accompanied by words showing a donative intent. But, of course, either constructive of actual delivery must completely divest the donor of his property and completely invest the donee with it.

Brooks v. Mitchell, 163 Md. 1 , 161 A. 261 ; 84 A. L. R. 547; Schenker v. Moodhe, 175 Md. 193, 201 , 100 A. 727 ; Lefrooth v. Prentice, 202 Cal. ²⁵¹ 215, 259 P. 947, 951 . A conveyance to a husband and wife will ordinarily create a tenancy by entireties, but an intention clearly expressed in the instrument that they shall take as joint tenants or as tenants in common will be effective. Wolf v. Johnson, 157 Md. 112, 120 , 145