Under Montana law, engagment ring is inter vivos gift, not conditional gift revocable upon termination of engagement

Law Reporter, Oct 2002

Albinger v. Harris, 48 P. 3d 711 (Mont. 2002).

The Supreme Court of Montana held that under state law, an engagement ring is an inter vivos gift, not a conditional gift that must be returned if the engagement is broken.

Here, a man gave his fiancee a diamond engagement ring. The couple then set a tentative wedding date but later put their wedding plans on hold as they broke up and reconciled numerous times. Each time they broke up, the woman returned the ring, which her fiance returned to her after the reconciliation. About two and a half years after their initial engagement, the parties finally broke up, with the man telling his fiance to take the ring and other gifts. He later sued the woman, seeking to recover the ring or its value.

The trial court entered judgment for the man, concluding that because the ring was given in contemplation of marriage, there was an implied condition attached to the gift and the giver was entitled to the ring if the marriage did not take place.

Reversing, the state high court held that Mont. Code Ann. sec27-1-602, which abolished breach-of-contract-to-- marry actions, precluded regarding the ring as a conditional gift. The court explained that under Mont. Code Ann. sec70-3-101, a gift is a transfer of personal property made voluntarily and without consideration. The court noted that the essential elements of an inter vivos gift are donative intent, voluntary delivery, and acceptance by the recipient. Where the evidence demonstrates the existence of these elements, the court said, the gift is complete and, thus, a court should not revoke the transfer merely because the giver experiences a change of heart.

The court also noted that a gift must be given without consideration and that a purported gift that is part of an inducement to take a certain action becomes the consideration essential to contract formation. The court explained that an exchange of promises to marry creates an unenforceable contract and that when an engagement ring is given in exchange for such a promise, a contract is formed and legal action to recover the ring is barred by 27-1602's preclusion of breach of promise actions.

The court also concluded that permitting actions for the return of engagement rings would violate state constitutional provisions barring bias based on sex. The court noted that the abolition of breach of promise actions bars all contract actions arising from a mutual promise to marry, including actions for recovery of any share of expenses incurred in planning a later-canceled wedding. Noting that women often bear the bulk of such expenses, the court determined that the statute continues to have a disparate impact on women. The court explained that adopting a conditional gift theory applied exclusively to engagement ring cases would carve out an exception primarily benefiting male plaintiffs, to the state's gift law and would, therefore, exacerbate the bias resulting from the state legislature's decision to abolish breach of promise actions.

Here, the court found that the man voluntarily offered the ring to his fiance without consideration and with the intent to transfer dominion and control to her. The gift was complete upon delivery and was not revocable. Consequently, the woman was entitled to keep the ring.

Woman's Counsel

Nathan J. Homes, Great Falls, Mont.