Donatio Mortis Causa - Equity PDF

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Donatio Mortis Causa is an exception to the Maxim that ‘Equity does not perfect an imperfect gift’. Donatio Mortis Causa is essentially an exemption for the dying which allows for them to transfer property without the normal stringent formal requirements. In RE: Beaumont (1902) Buckley J. described the Donatio Mortis Causa as “A gift to of an amphibious nature. It is neither a gift inter-vivos nor a legacy”. Under a Donatio Mortis Causa, the Donor must have made the gift in contemplation of death. As noted by Farwell J. in the leading case of RE: Craven’s Estate (1937) the Donor must contemplate death in the near future. The test is subjective, and therefore, it is the Donor’s state of mind which is relevant. In RE Wasserberg (1915), the Donor, on his deathbed, told the Donee that certain bonds in a bank were hers to keep. He gave the key of the bank vault to her and this was held to be a valid Donatio Mortis Causa. There are five requirements for a valid Donatio Mortis Causa: (1) The Gift must be in contemplation though not necessarily in anticipation of death . (2) The subject matter must have been delivered to the Donee. (3) The Gift must have been made in circumstances so as to show the gift is to revert to the Donor should they recover. (4) The Donor must part with control (Dominion) of the property before their death. (5) The Property must be capable of being the subject matter of a Donatio Mortis Causa. A Donatio Mortis Causa is always conditional on the Donor’s death. It is implicit that the gift is only taking place because the Donor believes he is going to die in the near future. The fact that he does not die in the manner contemplated is irrelevant. As Lord Porter stated in Agnew V. Belfast Banking Co. (1896); ‘A Donatio Mortis Causa is incomplete until death and depends on it. If the sick man recovers it is of no avail. No property passes until death’. In Wilkes V. Allington (1931), the Donor made a Donatio Mortis Causa in the belief that he was dying of cancer, he did not know how long he had left to live but believed it likely that he would die soon. He eventually died, a month later, from pneumonia as a result of a trip in an open topped bus in the rain. The Donatio Mortis Causa was held to valid because it was not conditional of his death from a particular cause.

What is the position of a Donatio Mortis Causa made Pre-Suicide? There are conflicting authorities on this point; In the case of Re: Dudman (1925), it was held that a gift made in these circumstances was not a valid Donatio Mortis Causa. In Mills V. Shields and Kelly (1948), the Donor, three weeks prior to his death, delivered a parcel containing £658 in currency notes, various coins and a number of share certificates to the second defendant. When delivering the parcel he asked the second defendant to deliver it to the plaintiff saying, “If anything should happen to me while I am away, will you give this to my brother.” The Donor was seriously ill at the time. Three weeks later he planned to go to Dublin for medical treatment. However, he left the Train Enroute to Dublin and Committed Suicide. The Plaintiff sought a declaration of he Court that the parcel was delivered to him as a gift and constituted a Donatio Mortis Causa. Gavan Duffy P. deciding that the Plaintiff had established a valid Donatio Mortis Causa and went on to say that: the substance of the direction that accompanied his Donatio was that the gift was to become effective if he should die when he went away for treatment, and on a fair view of the evidence I think that is what happened, for I think this was the journey in contemplation. I follow the decision of Lord Tomlin in Wilkes V Allington. It should be noted that a Donatio Mortis Causa cannot be revoked by a Will. This is because a will does not have effect until the Donor’s death, at which stage the Donee’s gift will be regarded as complete. All forms of personalty (Personal Property) (Movable Property) can be the subject of a Donatio Mortis Causa (Birch V. Treasury Solicitor (1951)). Since 1991, Real Property can also be the property of a Donatio Mortis Causa. In Sen V Headley (1991), A man who was dying gave his partner the key to a storage box in which he kept the deeds to his house. He then told her that he wanted her to have the house. The Court of Appeal held that this was a valid Donatio Mortis Causa of Land, thereby overruling the decision of the Trial Judge and reversing years of contrary authority. What about Cheques? RE: Beaumont is the authority for the view that it is not capable of being the subject of a Donatio Mortis Causa. Similarly, Promissory Notes cannot be the subject of a Donatio Mortis Causa. According to Martin, there is some authority that stocks and shares may not be the subject of a Donatio Mortis Causa either. However, in Staniland V. Willott (1852), it was held that shares in a public company can be the subject of a Donatio Mortis Causa though this exception has been doubted.

It has been established that there must be a ‘complete parting with dominion over the subject matter by the donor’ per Molony CJ in RE: Mulroy (1924). The parting of physical possession of property must be accompanied with an intention on the part of the donor to give dominion over the property to the Donee. Whether or not a Donor has merely parted with physical possession of the property or has parted with Dominion of the property is very fact sensitive and decided by the Courts on a case by case basis. The Seminal Court of Appeal case of Sen V Headley is illustrative of this approach. In this case, the Plaintiff and the deceased had lived together as man and wife for 10 years before his death. Following a diagnosis of inoperable terminal cancer, and whilst in hospital he told the Plaintiff; “The House is yours Margaret, you have the keys, they are in your bag, the Deeds are in a steel box.” At some stage the deceased had put the keys to the locked steel box in the Plaintiff’s handbag without her knowledge. He retained a set of keys to the house. Three days later the deceased died intestate and the Defendant, his Nephew, became the administrator of his estate, the principal asset of which was the house. The Plaintiff brought an action against Deceased’s estate, claiming to be entitled to the property on the basis that the actions of the Deceased amounted to a valid “Donatio Mortis Causa”. The judge at first instance found that there could not be a valid DMC of land and an appeal was brought by the Plaintiff. The Court of Appeal were required to determine whether real property could form the subject-matter of a valid DMC or, in the alternative, whether the trust imposed under a DMC must comply with the formality requirements mandated by s.53(1) of the Law of Property Act 1925 (LPA) in order to be upheld. In allowing the appeal of the Plaintiff, the Court found that the question of whether land could be the subject of a valid DMC had to be determined as the law had now developed, especially that concerning constructive trusts. Section 53(1) LPA does not apply to constructive trusts (s.53(2) LPA) and, as the trust arising under a DMC was imposed by operation of law, s.53(1) LPA could not apply to defeat a DMC of land where the requirements for a valid DMC were otherwise made out. It is interesting to note that the fact the deceased in Sen retained a set of keys to the house did not prevent the effective transfer of dominion over the property. On this point Nourse J noted that when the deceased handed over the title deeds he knew that he did not have long to live and that there was no practical possibility of him ever returning home. This can be contrasted with the Irish decision of RE: Mulroy. In this case, the deceased, in the presence of the Defendant opened a steel box and took out a deposit book and two outdated cheques, telling him that ‘I am sorry I do not have more to give you’, and that he had been very kind to him. He then proceeded to replace the items and lock the steel box and put the key in his pocket. He died intestate soon after. The Court of Appeal held that there had been no valid Donatio Mortis Causa as the deceased had not intended to lose Dominion of the documents in his lifetime.

The question of whether Dominion over property had been transferred to the Donee was considered by the Court of Appeal in Woodard V. Woodard (1992). In this case a son held his Father’s car as bailee while his father was in hospital receiving Cancer treatment. Prior to his death the Father told the Son to ‘Keep the keys, I won’t be driving it anymore’. The registration book was not handed over, and it was unclear whether another set of keys existed. Following the Deceased’s death a dispute arose whether has parted dominion over the car. The Court of Appeal held that there had been a valid Donatio Mortis Causa. In doing so, the Court rejected the argument of the plaintiff that the registration book should have been handed over noting that this was not a document of title to the car and that in any case, whether such documents were handed over were merely a matter of evidence as to the intention to make a gift and not things which it was essential to hand over to give the defendant dominion over the car. Another issue that arose in Woodward was the possibility that the deceased had retained a set of car keys. The Court of Appeal considered that the question was one of evidence as to whether the deceased has the requisite intention to transfer dominion over the car to the Defendant. However, the consequence of retaining of retaining a duplicate set of keys was considered in RE: Craven’s Estate in the context of a locked box of valuables where it was suggested that retention would be inconsistent with a sufficient parting with dominion over the property. Delany Posits that a Donatio Mortis Causa will probably fail if the Donor retains another key. In Bentham V Potterton (1998), the deceased, in her will bequeathed cash legacies varying in amount from £1000 to £3000 to nine beneficiaries, including the first and second named Plaintiffs, her grandnieces, and a residuary clause provided for the division of the remainder of the estate equally between all but one of the named beneficiaries. The deceased was hospitalised two months before her death, and it was discovered that she was suffering from inoperable cancer. The Trial Judge was satisfied that there was no evidence that there was no evidence that she had ever been told that her condition was terminal and it was not until a week before she died that she told her niece that she was in fact dying. Three and half weeks before her death, the deceased asked the first named Plaintiff to retrieve bank books from her home from her home and out them in a safe in the first named Plaintiff’s home, which she did. The following day, the first named Plaintiff informed her great aunt that she had carried out her wishes and the first named Plaintiff deposed that her great aunt then told her that if anything was to happen to her she was to keep the contents of the books and give her sister a few bob out of it. After the Deceased’s death, an issue arose as to whether this transaction amounted to a valid Donatio Mortis Causa made in favour of the Plaintiffs. Barr J made it clear that the onus lay on the party claiming the gift to establish to the court that the requirements for a valid Donatio Mortis Causa had been satisfied.

In the first instance, he said that the facts fell short of establishing on the balance of probabilities that the gift had been made by the Donor in contemplation of her death. He suggested that if it had been the Deceased’s intention to make a gift of the funds on deposit to the Plaintiffs, it seemed probable that she would either have made this clear on the first occasion on which she had referred to the deposit books, or alternatively would have made a new will or codicil to give effect to her revised intentions. Barr J. concluded that that he was not satisfied that the deceased “positively intended to make a radical change in the disposition of her property in contemplation of her death”. Although this might have been her intention, he said that the surrounding facts raised considerable doubt in this regard, and in the circumstances, he held that Plaintiffs had not established the validity of the alleged gift on the balance of probabilities. This decision would appear to confirm that it is essential that the Court is satisfied the Donor knew they were dying or was at least contemplating death at the time the transaction took place. Barr. J said that he had substantial doubts about whether the Donor appreciated the gravity of her medical condition at the time. Although she was elderly and had been gravely ill two years previously, he referred to the fact that there was no evidence that the deceased had been told that her condition was terminal, and pointed out that it was only some two and a half weeks after the transaction had taken place that she had admitted to her niece that she thought she was dying, In these circumstances, he said that the facts fell short of establishing on the balance of probabilities that the gift had been made by the donor in contemplation of her death. The English Courts have considered this concept more recently in King V Dubrey (2015) and Valle V. Birchwood (2013) In Valle V Birchwood, Judge Jonathan Gaunt QC, upheld a Donatio Mortis Causa, asserted that the requirement for contemplation of death in such cases did not mean that the Donor to be in extremis. The Donor was visited by his daughter, and at the end of the visit, she told him she would see him again at Christmas. He told her that he didn’t expect to live that long, and proceeded to had her the title deeds and keys to his house. He died intestate three months later. It was held that such a gap between the alleged gift and death was not fatal to the claim, even though, during this time, the donor continued to live in the property without any involvement or interference from the Donee. In King V Dubrey it was stated that the task for the court is to distinguish between a genuine Donatio Mortis Causa and an attempt to make a testamentary gift other than in accordance with Section 9 of the Wills Act or Section 52 of the Law of Property Act. No case of this description ought to prevail unless it is supported by evidence of the clearest and most unequivocal character. In this case, The Claimant had lived with his elderly aunt for four years before her death.

He asserted that his aunt wished for him to have the property and ‘find a nice lady for him to share it with’. Some four to six months before her death, she presented him with the title deeds to the house saying, this will be yours when I go. Hollander J, in upholding the gift, deemed this parting with possession to be particularly important notwithstanding that the deeds remained in her house, albeit in Mr. King’s bedroom. On appeal to the Court of Appeal, Hollander J’s decision at first instance was reversed. Jackson L.J’s judgement has significantly limited the circumstances within which a valid Donatio Mortis Causa will be deemed to have arisen. The decision establishes that a valid Donatio Mortis Causa must be made in contemplation of imminent death for a specific reason. Jackson LJ said that the requirement that the gift be made in contemplation of death necessitated “death in the near future for a specific reason”. A general feeling of approaching the end of one’s natural lifespan was not sufficient. Jackson LJ noted that strict proof was necessary to establish a Donatio Mortis Causa to prevent abuse and prevent avoidance of the requirements of statute. He was decidedly skeptical as to what useful purpose the doctrine served in modern times “As many judges have observed, the doctrine of Donatio Mortis Causa in the context of English Law is an anomaly. It enables a Donor to transfer property upon his death without complying with any of the formalities of Section 9 of the Wills Act or Section 52 of the Law of Property Act which stipulates that transfers of land must be by deed to be valid. Thus the doctrine paves the way for all of the abuses which those statues are intended to prevent.” Jackson LJ also suggested that Valle V. Birchwood had been wrongly decided as in that case the Donor felt he was approaching the end of his lifespan but did not have reason to anticipate death in the near future from a known cause.” It is essential that imminent death for a particular reason must be actually anticipated at the time of the gift and the gift will fail if the Donor doesn’t die as anticipated. A Donatio Mortis Causa cannot run on until eventual death if the death was not imminently anticipated at the time of the gift....