What is a gift?

In the law of property, a gift is a present transfer of a property interest from one person to another – from the grantor to the grantee. For a gift to be legally effective, it must have the elements of intention, delivery and acceptance.

Intention

A gift can only be legally binding if the grantor has the present intention to make a gift of the property to the grantee. The intent is essentially determined by the grantor’s words. The law requires that the intent must be present at the time the gift is made. This means that if someone wants to give something, the intent must be made in the present. For example, if A promises to give B a piece of his land “a year” after the latter’s wedding, the promise is not legally binding or is unenforceable because there is no intent to make the gift at the time A made the promise. Mere expectation of something that will be given in the future is not legally adequate to create a gift.

A New Property

A New Property

In addition, other factors like relationship between the giver and receiver, the size of the gift in relation to the grantor’s actual property, and the grantor’s legal capacity to make a gift are also considered. This is to avoid situations where a conflict may exist between the grantor and the grantee.

Delivery

The second element required to make a gift effective is the “delivery”. This means that a gift must be delivered by the grantor to the grantee. In real property, where the gift can never be delivered in the conventional sense, the gift can be conveyed through constructive delivery or symbolic delivery.

In constructive delivery, a tangible item (such as a key to the house) that allows access to the gift is delivered. While in symbolic delivery, something that symbolises the transfer of ownership (like the miniature model of the house) is delivered instead.

Acceptance

The last element that seals the transfer of interest in the property is “acceptance.” This means that for the gift to be recognised as valid, it must be accepted by the grantee. However, as a gift is usually accepted if it is beneficial to the recipient, acceptance is presumed. But the grantee can refuse the gift by expressly rejecting it. Rejection of the gift destroys the gift, thus the grantee cannot revive it by accepting it at a later time. Later acceptance of the rejected gift can only be effective if the grantor extends the offer of the gift again.