Scott v. First National Bank of Baltimore
224 Md. 462, 168 A.2d 349 (1961)

  • Wilmer Scott decided to leave his wife and child. As part of the separation agreement, in return for not paying child support, he assigned under seal to his daughter Virginia one half of his expectancy in his father’s estate.
    • In return, the Virginia gave $1 as consideration to make it a contract.
    • There were other monetary considerations as part of the divorce.
      • Wilmer never paid most of them, the deadbeat.
  • Years later, Wilmer’s father died intestate, and the administrator (Bank of Baltimore) filed an interpleader action to see who the money should go to.
    • There was a question as to whether an expectancy could be legally assigned.
      • The expectancy was not a set amount. There was a reasonable chance that Wilmer’s father could have died with no money, or he could have left the money to someone who wasn’t Wilbur.
  • The Trial Court found that the contract was valid and that the money should go to the daughter.
  • The Appellate Court affirmed.
    • Assignments of expectancies are legal as consideration of a contract.
    • However, $1 is nominal consideration and does not make for a valid, enforceable contract.
    • However, the Appellate Court found that the real consideration was Wilbur’s wife agreeing to taking on the parenting responsibilities and costs after he left. The divorce settlement would have been different if the assignment was not a part of the negotiations. That counts as consideration, so the contract is valid.
  • Different States have ruled differently as to whether expectancies can be assigned.
    • Some States refuse because it encourages poor people to sell their inheritance to scammers.
    • Other States will allow assignments, but only as part of valid contracts, you cannot make a gift of an expectancy.