Engagement Rings: Conditional Gift or …?

For many of us, an engagement ring is one of the first major purchases of our lives.    In 2011, the average engagement ring costs $5,392.  The common norm suggests spending three months salary on a ring.  Ouch.  The price is small when compared to the benefit of sharing your life with another, we suppose.  But what happens to the ring if the marriage ends in divorce?  Or, even worse, if the wedding never takes place?  The ring-purchaser can certainly think of a few other bills to pay with three months salary.

Recently, in Campbell v. Robinson, No. 4969 (S.C. Ct. App. May 9, 2011), the South Carolina Court of Appeals offered its thoughts on the age old former-relationship property dispute.  After their engagement was cancelled, Campbell sued his ex-fiance, Robinson, seeking a declaration that he owned an engagement ring he presented to her during the proposal.  In addition, he sought restitution for the benefit Robinson received while possessing the ring.  Robinson counterclaimed for breach of the promise to marry and sought recovery of her prenuptial expenditures.  We suspect there may have been some awkward depositions during this case. The trial court charged the jury that Campbell would receive the ring if Robinson was at-fault for ending the engagement and vice versa.  The jury found for Campbell on Robinson’s breach of the promise to marry claim.  However, the jury determined that Campbell was at-fault for ending the engagement and, thus, was not entitled to recover the ring.  On appeal, the Court of Appeals held that fault has no bearing in determining ownership of an engagement ring.  Rather, an engagement ring is conditioned on the marriage taking place.

Guess what? I myself had the pleasure of watching the trial of this case when I was in law school.  To sum it up nicely, the trial was equal parts property law lecture and soap opera.  Because this was a case of first impression in South Carolina, the arguments regarding the law took much longer than the trial itself.  Even as a law student, I can remember questioning the imposition of “fault” into basic gift law.  For starters, what does “fault” even mean in this context? Is the at-fault party the one whose conduct led to the demise of the relationship?  Or is the at-fault party the one who actually calls off the engagement?  The jury was never given any guidance.   You can imagine the helter skelter craziness that must have transpired in the deliberation room.

Once fault became an element, the trial became suitable for television.  With countless “he said, she said” arguments, the jury becomes the arbiter for choosing sides in a break-up – not resolving a property dispute.  Decisions like these are best left for Judge Judy.

At the end of the day, the Court of Appeals got this one right.  For now, the easiest way to resolve these disputes is by treating the ring as a conditional gift and applying gift law principles.  But in the future, these disputes could be easily eliminated if we required reciprocal gifts at the time of the engagement.  Who would sue for the return of a ring if it meant giving up your new set of golf clubs?  Not me.

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