One may not withdraw from a gift transaction unless it was conditional in the first place

October 11, 2019

As part of a settlement over a family dispute, an uncle gave his nephew a real estate asset as a gift and signed an irrevocable power of attorney, all while the nephew covenanted to demolish a staircase built in the uncle’s territory and repair the boundary line between their plots. After the power of attorney was signed, the nephew refused to sign a land-sharing agreement and demolished the stairs.
The Court held that the property was given as a gift and the gift may not be revoked. Israeli law recognizes a gift transaction and it is sufficient to deliver a gift-giving document to complete the transaction unless the law provides otherwise. In real estate matters, a transaction that has not ended in recording is merely a commitment to make a transaction, so that a real estate gift will only be a commitment to give a gift and may still be withdrawn from. However, here the land has not yet been recorded in the name of the uncle, so his right was not a right in real estate but a right to receive real estate and it is sufficient therefore that a power of attorney was delivered in order to complete the transaction and the gift may not be withdrawn from. A gift may be conditional or may be linked to an ancillary obligation. Unlike a conditional gift which, without meeting the condition is not valid, when it comes to a gift with an ancillary obligation, the gift cannot be withdrawn from but a claim may be made on the ancillary obligation. Here the documents show that the commitment to demolish the stairs was not delimited in time and was not a condition for the gift but an ancillary obligation and therefore the gift may not be withdrawn from.