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Matter of Estate of Santa Perrone

Decided: November 13, 1950.

IN THE MATTER OF THE ESTATE OF SANTA PERRONE, DECEASED


On certification to the Appellate Division of the Superior Court.

For affirmance -- Chief Justice Vanderbilt, and Justices Heher, Oliphant, Burling and Ackerson. For reversal -- Justices Case and Wachenfeld. The opinion of the court was delivered by Vanderbilt, C.J. Case, J. (dissenting).

Vanderbilt

From an order of the Probate Division of the Essex County Court allowing an exception to the account of the executors of the estate of Santa Perrone an appeal was taken to the Appellate Division of the Superior Court and certified here on our own motion.

Santa Perrone died on December 31, 1947, leaving a will naming her husband, Joseph Perrone, and her nephew,

Thomas Perrotta, as her executors. To the inventory filed by them, Alfredea Piro and Angelina Piro, two of the legatees, filed an exception alleging that the executors had failed to include in the inventory the sum of $1,207.03 on deposit in the Bank of Nutley in the name of Joseph or Santa Perrone, which, they contend, constitutes an asset of the estate.

At the hearing on the exception on December 6, 1949, it developed that the Perrones were married in 1932. At the time Mr. Perrone was employed by a leather company while Mrs. Perrone owned and ran a small store. In 1943 Mr. Perrone left his job with the leather company to take one with the Nutley Park Department at a salary of $35 to $38 a week. He held that job for two years, when he began to work in his wife's store, also doing odd jobs as a gardener, as the income from the store, he said, was not sufficient to cover household expenses.

The account in question was opened on May 22, 1943, with an initial deposit of $204. Mr. Perrone testified that all deposits to the account were made with his own money and that no deposits were made therein by his wife. The deposit slips, which were not in Mr. Perrone's handwriting, reveal that each check deposited, except one, exceeded Mr. Perrone's current weekly salary, which was paid him by check, and several of the deposits were checks received from customers of the store prior to Mrs. Perrone's leaving it because of illness. Mr. Perrone explained these circumstances by saying that the customers' checks had been cashed by him out of his own funds, that he had purchased merchandise in his own name for resale, that the store was in fact owned by him. Yet no deposits were placed in the bank account after the death of Mrs. Perrone and no withdrawals were made therefrom until after her death. On October 29, 1948, ten months after her death, Mr. Perrone executed a draft to his own order for the entire balance in the account. Other than the assistant cashier of the Bank of Nutley, who merely identified certain documents, Mr. Perrone

was the only witness at the hearing. No evidence was offered by the accountants to refute the exceptants' case.

On December 12, 1949, six days after the hearing on the bank account, the same exceptants filed a complaint charging the executors with having failed to include in the inventory two mortgages aggregating $5,615, and on the basis of the complaint they obtained from the trial court an order to show cause why the executors should not be removed, with ad interim restraint against the disposition of the assets of the estate. On the return of the order to show cause the matter was continued three weeks to January 31, 1950, at the request of the executors. At the adjourned hearing no testimony was taken, but counsel stated in open court the undisputed facts. The husband-executor had obtained payment of the balance of $5,615 due on two purchase money mortgages made in 1945 and 1946 respectively and standing in the names of the husband and wife. Three checks in all, one to the order of husband and wife, another to his order individually and as executor, and a third to the order of cash, were endorsed and appropriated by him, with the assistance of his co-executor, who joined with him in endorsing the mortgages for cancellation, their signatures being certified as genuine by an attorney other than the attorney for the estate, who had no knowledge of the mortgages until he received the complaint and the order to show cause. The mortgages were not included in the inventory or in the inheritance tax report and the exceptants acquired knowledge of them by rumor subsequent to the original hearing on December 6, 1949. On January 30, 1950, the day before the adjourned hearing, Mr. Perrone agreed to pay back $2,807.50, being one-half of the amount he had collected, which is concededly all that was due to the estate on the mortgages. The only dispute as to the mortgage transaction was with respect to counsel fees and costs, which the trial court took under advisement pending a decision as to the bank account.

The trial court, after considering the evidence along with the demeanor of the witness, concluded that the money in the

bank account was originally that of the decedent and not that of the husband; that the husband's claim that he put his wife's name on the account so that she would have the fund in the event of his death negatived the possibility of a gift inter vivos from her to him; and that the account not only was originally hers but continued to be her property. The money in the bank account was ordered to be included in the inventory and to be distributed in accordance with the will. From this order the executors have appealed.

The first of the four points argued here is that the exceptants failed to sustain their burden of proof or to produce any evidence that the money in the bank account had been the property of the testatrix. It is well settled that the burden of showing that there are more assets in an estate than are acknowledged by the executors in their inventory or account rests upon the exceptants, and that their contentions must be sustained with reasonable certainty, In re Schlosser, 119 N.J. Eq. 201 (Prerog. 1935); affirmed, 119 N.J. Eq. 488 (E. & A. 1935). The burden of proof is upon the exceptants to show that the bank account belonged to the decedent, but when this burden has been met by the exceptants the burden is transferred to the executors to establish their own claim to the property in question, Smith v. Burnet, 35 N.J. Eq. 314, 323 (E. & A. 1882); Slack v. Rees, 66 N.J. Eq. 447, 449 (E. & A. 1904); In re Fulper, 99 N.J. Eq. 293, 302 (Prerog. 1926). The appellants contend that the testimony of Mr. Perrone is uncontradicted and even though the court believes it to be improbable or incredible, the court must nevertheless accept it as true, citing Wilken v. Shein's Express, 131 N.J.L. 450 (Sup. Ct. 1944), and Baldauf v. Russell, 88 N.J.L. 303 (E. & A. 1915). The court, however, is not so restricted in its capacity as trier of the facts, but is free to weigh the evidence and to reject the testimony of a witness, even though not directly contradicted, when it is contrary to circumstances given in evidence or contains inherent improbabilities or contradictions which alone or in connection with other circumstances in evidence excite suspicion

as to its truth. Testimony to be believed must not only proceed from the mouth of a credible witness but must be credible in itself. It must be such as the common experience and observation of mankind can approve as probable in the circumstances. Ravitz v. Chirelstein, 135 N.J.L. 5, 6 (Sup. Ct. 1946); Gilson v. Gilson, 116 N.J. Eq. 556, 560 (E. & A. 1934); Dobbin v. Plager, 92 N.J. Eq. 231, 235 (E. & A. 1920); Cartan v. Phelps, 91 N.J. Eq. 312, 316 (E. & A. 1920); Second Nat. Bank of Hoboken v. Smith, 91 N.J.L. 531, 537 (E. & A. 1918); Clark v. Public Service Electric Co., 86 N.J.L. 144, 150 (E. & A. 1914); Schmidt v. Marconi Wireless Tel. Co., 86 N.J.L. 183, 186 (E. & A. 1914). Even in the case of Baldauf v. Russell, supra, 88 N.J.L. 303 (E. & A. 1915), relied upon by the appellants, it was stated (at page 306):

"But the testimony of a competent witness cannot be capriciously rejected. There must appear some good reason for such action, as, for example, that his story was inherently improbable, or that it was contradicted by some other testimony, or by some proven fact ...


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