## Facts

- Leopold Cohn beneficially owned 7,213 shares of American Sumatra Tobacco Company stock held in a family firm’s name; the certificates were kept in a New York safe deposit box.
- On September 20, 1911 (his wife’s birthday), while in New Jersey and before family witnesses, Leopold wrote and delivered to his wife a signed writing stating that he gave her 500 shares “on this day” as a birthday gift.
- Leopold stated that the certificates were “at the firm” and that he would obtain and deliver them to her as soon as possible.
- The stock certificates were not in Leopold’s personal name, and their location and form of holding made immediate manual delivery difficult at the time the writing was delivered.
- Leopold died six days later, on September 26, 1911, before physically transferring the certificates to his wife.
- In a judicial settlement decree, the Surrogate’s Court treated the transfer as a completed inter vivos gift and awarded the 500 shares to the wife (also the executrix).
- Other interested family members appealed, arguing that the writing showed, at most, a future intention to give and that lack of delivery defeated the gift.

## Issues

1. Whether the writing and surrounding circumstances established a present donative intent to make an inter vivos gift of 500 shares of stock.
2. Whether the absence of manual delivery of the stock certificates before the donor’s death defeated the gift, or whether delivery could be satisfied constructively given the circumstances.

## Decision

- The Appellate Division affirmed the decree awarding the 500 shares to the wife.
- The court found conclusive evidence of a present intent to make an immediate gift, not a mere promise of a future transfer.
- The court held that manual delivery of the certificates was not required on these facts because there was a satisfactory and reasonable excuse for the failure to deliver them at the time of the gift.
- The court noted the absence of fraud and the absence of prejudice to creditors as supporting enforcement of the gift.
- A dissent would have required stricter proof of delivery and treated the writing as insufficient to complete a gift of stock.

## Legal Principles

- A valid inter vivos gift requires (1) present donative intent and (2) delivery sufficient to transfer dominion and provide reliable evidence of the gift.
- For corporate stock, delivery commonly occurs by delivery of the certificate or an equivalent transfer act, but delivery is not an inflexible ritual where intent is conclusively shown.
- When a donor’s present intent is conclusively established and practical circumstances reasonably prevent immediate manual delivery, a court may treat the delivery requirement as satisfied by constructive delivery and uphold the gift.
- The absence of fraud and lack of impairment of creditor rights weigh in favor of enforcing a claimed inter vivos gift despite imperfect physical delivery.

## Conclusion

The court upheld a claimed inter vivos gift of stock where a written instrument and contemporaneous statements proved a present transfer, and where logistical and legal obstacles to obtaining certificates provided a reasonable excuse for the lack of manual delivery before the donor’s death.


In re Cohn, 187 A.D. 392, 176 N.Y.S. 225 (App. Div. 1st Dep’t 1919)