Undue Influence and Gifts

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What is “Undue Influence” With Regards to a Gift?

Legally speaking, gifts need to be transferred voluntarily, at the free will of the person making the transfer.  There cannot be any instance of “undue influence” in a gift transfer.  The basic idea behind undue influence is that the donor was wrongfully influenced by another person to give them the gift.

Undue influence can be proven through different ways, such as examining the statements or conduct made by the recipient.  Certain acts like threats, fraud, misrepresentation, or physical/moral coercion can undermine the owner’s willpower or free agency.

Thus, the basic test for undue influence in a gift transfer is whether the donor acted voluntarily and willfully, based on their free agency. 

How is Undue Influence Determined?

When proving undue influence in a gift transfer, a court will usually examine all the surrounding circumstances.  These can include:

Thus, the court may need to examine the “totality of the circumstances” in order to find undue influence.  Each case may be different depending on the facts and the background of the parties.

What Happens to the Gift if Undue Influence was Involved?

In most cases, gift transfers resulting from undue influence are considered revocable.  This means that the donor may reclaim their gift, and the recipient must return the property to them if possible.

If the gift has been altered, destroyed, lost, or cannot be located, the recipient may have to reimburse the donor through a monetary payment.  This will be calculated according to fair market values at the time of the transfer.  The recipient of the gift may also have to pay damages for any losses resulting from the transfer. 

Do I Need a Lawyer for Undue Influence in a Gift Transfer?

Transfers of gifts are often very personal and can involve many different inter-personal factors.  If one party has taken advantage of the other and wrongly influenced them to give a gift, they may be held liable for their actions.  If you need assistance with undue influence and gifts, you may need to contact a lawyer for advice.  Your attorney can help you file a lawsuit if necessary and can assist you in recovering your losses.

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Last Modified: 02-13-2012 03:47 PM PST

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