No Takebacks! Part II

Gifts –once given, can the giver take them back?

Surprisingly – Yes !!

The three elements of a gift are:

Intent

Delivery

Acceptance

Most often all three events occur simultaneously but not in all instances. Examples include (1) a nephew or niece has graduated from high school and cash or personal property is given by the relative to the graduate, (2) an adult child gives his parents a vase with their “25th anniversary” etched into it, (3) a boyfriend or girlfriend gives a gift to the other on their birthday, whether it is cash, a gift certificate, or other personal property. In all of these examples, there is completion of the gift and each gift is given without any statements of conditions, either express or implied. Many times the case is that the individual who made the gift can’t get it back if the receiver does not wish to return it. However, there are many situations when a conditional gift is given, either express or implied, and in those situations, the giver may be able to get the gift back. If that gift is not voluntarily returned by the receiver, the giver of the conditional gift can go to court and the court issues a court order for the person who received the gift to return it or to pay the fair market value of the gift.

Is this fair, you ask, and, quite frankly, it may not be or it may be fair or logical based on legal principles. Am I talking out of two sides of my mouth? Maybe- Yes.

Let me provide a few examples of conditional gifts. A boyfriend or girlfriend gives their significant other an engagement ring. This is probably the best example of a conditional gift. The “condition” is that the ring is given on the condition that the giver and receiver are married in the future. If the marriage never occurs because either party broke off the engagement, the person who received the ring is obligated to return it. There are some exceptions to the general rule of this conditional gift. They will be covered at another time.

Another, perhaps more obvious example of a conditional gift, is when a person gives land to a recreation association or to a non-profit organization for only one purpose, such as for a school or house of worship. In the event that purpose no longer exists, the deed recites that the land reverts (goes to ) the original owner or his Estate or relatives of the person who gave the land on the condition. Many situations involving conditional gifts do not have the conditions expressed as they are in a deed.

The best example, in my opinion, of a conditional gift is the landmark case of Grossman v. Greenstein from 1931. This case was reported at the Maryland Court of Appeals and is cited as the leading case dealing with conditional gifts.

Harry Grossman was the fiancé of Sara Greenstein and they were to be married. The father of Sara Greenstein gave a gift by depositing $1000 in a joint account at a Savings Bank. The language used on the account read ‘’ Sara Greenstein in trust for herself and Harry Grossman, joint owners subject to their joint order, balance at death of either to belong to the survivor.” This type of account would usually be owned by the couple however the facts state this will not be a usual result.

Harry Grossman, the fiancé, broke the engagement and stated he would not marry his fiancée, Sara Greenstein, and stopped all contact with Sara. Sara consented to the cancelling of the deposit but apparently Harry was not willing to remove the funds from the bank even though Harry knew that the reason for the father’s deposit was the contemplated marriage. The fact the deposit was made in contemplation of the marriage made the gift a conditional gift. Once the condition is not fulfilled, meaning no marriage, the money must be returned and, in this factual situation, to Sara’s father.

Courts look at the circumstances, the intent of the party who gave the gift, and other factors. Also, the courts have approached cases similar as the one above on Equitable Theories. The courts have applied equitable principles and have found that the party receiving a gift in contemplation of marriage should not be unjustly enriched. Therefore, the gift is conditioned and should be returned. Other cases have been found to involve a conditional gift, i.e., in regard to parents of a couple whose children were getting married, one of the parties’ parents gave a couple of hundred dollars for a gift as a down payment on a house. Many years later, when the couple was seeking a divorce, the giving parent testified that the gift was conditional on the married couple remaining married.

Fred Antenberg has practiced Family Law for over 30 years and has his office in Columbia, Maryland.

Fred has represented persons who gave conditional gifts and Fred was able to have the gifts returned. This does not mean that previous success is a guarantee of success in your need. Call Fred today at 410 730 4404 for a free initial consultation.