Inter Vivos Gift
Importantly, a gift is essentially a donation from the donor to a donee.
An inter vivos gift is an ordinary gift from one living person to another. The three elements for a valid gift of this type is “donative intent, delivery, and acceptance.” These gifts are almost never revokable.
Gruen v. Gruen
496 N.E.2d 869 (N.Y. Ct. App. 1986).
The plaintiff lost at trial but won at the appellate level. The defendant now appeals.
Question
Can a inter vivos gift be given by the donor but retained during their life? In other words, is the gift valid if the donor never parts with the gift before death?
Rule
“There must exist the intent on the part of the donor to make a present transfer, delivery of the gift, either actual or constructive to the ones, and acceptance by the donee.”
Holding
A valid gift took place, affirmed.
Facts
The plaintiff is the son of Mr. Gruen. Mr. Gruen had written letters to his son telling him that he was the owner of the painting in Mr. Gruen’s possession. However, Mr. Gruen retained possessory rights until his death. Once he died, the son went to claim the painting from his stepmother who refused to give it up. As a result, the son sued, hoping for a court order affirming his claim to ownership.
Analysis
First, the court provides an analysis of donative intent. For a gift to be a proper donation, there must be an intent to transfer title in the present. Otherwise, the only way to obtain possession is through a statement in the will. Here, there was donative intent because the letters from the father indicate that the son owned title and the father simply retained lifetime possession.
Second, there must be actual delivery or delivery of an instrument (symbol) that acts as the complete delivery of the item. Here, the letters act as delivery. It would be impractical to expect actual delivery of the painting when the possessory right remained with the father.
Finally, the actions of the plaintiff showed that he accepted delivery of the painting (showing his friends the letters and talking about his ownership). It is important to note that acceptance must be immediate, and that lack of evidence showing acceptance years later does not negate the original acceptance.
Additional Notes
The three elements of a legally transferred gift are:
- Donative intent
- Delivery from the donor
- Acceptance by the donee
Importantly, the donative intent needs to be immediate (title transfers at the time, not at a future date).
Another term to know is inter vivos. This translates to “a gift during life.” These gifts are considered not revokable if all the elements are met.
This case sets up the idea of the difference between a gift during during and a gift after death. This is also an introduction to the concept of owning a gift, but not possessing it until later.
In this case, the question is whether the gift was inter vivos or a testamentary gift (such as a gift given in a will).
Donative intent
Donative intent needs to be immediate and present. Here, this was shown by the series of letters that state the son obtained ownership at the time of the letter. The issue here was that the painting was to be held by his father until his death.
“I give you the painting when I die” v. “I give you the painting, but I want to keep it until I die.” The difference here is when ownership changes. In the first statement, the title transfers at the time of death (and must be included in a will). In the second statement, the title transfers at the time of the statement and the donor only maintains a possessory interest. This possessory interest is called a “life estate”. The son is given a “remainder” where they can adopt the rest of the possessory rights in the future.
What can the son do with this remainder?
- He can resell
- Devise – put it in a will
- He can borrow against
What can the father do with his life estate?
- He can sell the life estate. The purchaser would still have to give the painting to the son at the time of the father’s death.
Delivery
Delivery of a gift can be manual, constructive or symbolic. There is no evidence of manual delivery of the painting. A constructive delivery is when you are delivered a physical method to access to the item (like a key to a chest). This is not the case here. Thus, we are left with a symbolic delivery.
A symbolic delivery is an external device that transfers title to the donee. The letters here count.
Where possible, physical manual delivery should be the standard. Where not possible or impractical, constructive or symbolic is sufficient.
Acceptance
Acceptance is presumed if the item is of value. Here, he accepted it. Later neglect of listing it as an asset does not keep the son from his previous acceptance.
Gift Causa Mortis
These are gifts that are given when the donor contemplates death. As a result, there is an additional element to the traditional three: “the donors anticipation of imminent death.” Significantly, these gifts are easily revokable. For instance, if the donor changes their mind before death, the gift is revoked. Additionally, if the donor does not end up passing, the gift is revokable. Finally, the question remains of what happens if the donor passes from a cause other than the one they had expected? Are those gifts revokable? See the case below.
Brind v. International Trust Co.
179 P. 148 (Co. 1919).
The estate of Brand is the plaintiff. They lost in trial court and appealed.
Question
Was a valid gift made?
Rule
The donor must perish of ailment they are concerned about. Otherwise, the gift is revokable.
Holding
She did not perish or reaffirm the gift. Therefore, the gift was revoked. Reversed.
Facts
Mrs. Brind had ownership of several pieces of jewelry. She also had a tumor that was threatening her life. Some time before her passing, Mrs. Brind underwent a surgery to remove the tumor. Before the operation, she wrote a document listing out several pieces of jewelry to be given to several individuals “under the condition that she dies from the operation.” However, the doctors saw that the operation would kill her and therefore did not proceed. Mrs. Brind recovered from the operation but ended up passing some time later from the tumor.
Before her death, she was asked about the items she left in the possession of the trust company to be gifted out at the time of her death. To one witness, she wished that those items were to go to the people listed. To her attorney, who feared that the gift would be invalid, she said that she would think about it and call him if she wanted to reaffirm the gift. This she did not do before passing.
Analysis
Because Mrs. Brind did not die from the operation she feared in her statement, the gift was revokable. Because it was revoked and not reinstated (see the testimony of her attorney), the possession of the trust is improper and the items are to be returned to the estate.
Additional Notes
The issue in this case is that she passed of a cause different than the one she intended. Because she did not die from the operation and did not reinstate the interest in a will, the gift is revokable.
In other words, these are gifts that are given to contemplate death and because these are highly disfavored from the court, they are easily revokable. Under any of the following circumstances would it be revokable.
- Passing from a cause other than that considered
- Not passing until later in time and the gift is asked for back
Engagement rings
Should the engagement ring be a revokable gift?
The determination here is whether it is a conditional gift. Ultimately, it is only a gift as long as the marriage takes place. As a result, the giver is the person who retains ownership (if the marriage does not take place).
Another consideration would be who was at fault for the break-up. Some courts say that the person who is at fault does not get to retain the ring.
Disclaimer
The content contained in this article may contain inaccuracies and is not intended to reflect the opinions, views, beliefs, or practices of any academic professor or publication. Instead, this content is a reflection on the author’s understanding of the law and legal practices.
