S. Hing Woo v. Smart

Rule of Law:

The delivery of a donor's personal check does not constitute a completed gift causa mortis until the check is paid by the bank prior to the donor's death. Until payment, the donor has not relinquished dominion and control over the funds.

Facts:

• William D. Yee and S. Hing Woo had an intimate, unmarried relationship for nearly 20 years.
• In 1985, Yee was diagnosed with coronary heart disease.
• On March 27, 1989, believing his death was imminent, Yee gave Woo two personal checks, one for $42,700 and another for $80,000.
• On March 28, 1989, Yee gave Woo a third check for $1,900, telling her he wanted her to have the money if he died.
• Yee died in a hospital emergency room on March 29, 1989, before any of the checks had been cashed.
• The day after Yee's death, Woo presented the checks for $42,700 and $1,900, and the bank paid the proceeds to her.
• The $80,000 check was never presented for payment because there were insufficient funds in the checking account upon which it was drawn.

Procedural Posture:

• John S. Smart, the administrator of William D. Yee’s estate, filed a bill of complaint for a declaratory judgment against S. Hing Woo in a Virginia trial court (chancery court).
• The administrator sought a declaration that the checks were not effective gifts and requested a judgment for the $44,600 Woo had received from cashing two of the checks.
• Woo filed a cross-bill, asserting she was entitled to the proceeds as gifts causa mortis or, alternatively, through a constructive trust.
• Following an ore tenus hearing, the chancellor ruled that the gifts failed for lack of delivery.
• The trial court entered a final decree ordering judgment against Woo for $44,600 plus interest.
• Woo, the appellant, was granted an appeal to the Supreme Court of Virginia.