Unconscionable Procurement: Voiding a Gift

As part of their estate plan, people often elect to give inter-vivos gifts to their loved ones. This can help to minimize probate fees, and to allow loved ones to enjoy their inheritance earlier. Many testators may not realize that there are several reasons the courts may deem an inter-vivos gift invalid. For example, a gift of real estate may be considered imperfect if it was not officially registered with the Land Title and Survey Authority of BC, making the gift void.

A less common reason for voiding an inter-vivos gift is the doctrine of unconscionable procurement. If someone doesn’t fully understand their actions when making an inter-vivos gift, the doctrine of unconscionable procurement can make the gift voidable. This equitable doctrine protects vulnerable gift-givers from being exploited.

When the Doctrine of Unconscionable Procurement can be Enacted

The doctrine of unconscionable procurement is intended to protect against undue influence. It applies when a gift transfer is arranged by the recipient and doesn’t reflect the giver’s true intentions. In these cases, the gift giver may not fully understand what’s happening or the nature of the transaction. It’s important to note that a successful claim doesn’t automatically void the gift—it makes the gift voidable.

In order to have a successful unconscionable procurement claim, there are two primary elements that must be found:

1. One person receives a gift from another; and
2. The recipient of the gift was actively involved in the process of receiving the gift, and arranging the transfer.

When these criteria are met, it raises suspicion that the gift-giver may not have fully understood the gift. At this point, the burden of proof shifts to the defendant. They must show, on a balance of probabilities, that the gift wasn’t unconscionably procured. This means that they must provide evidence which demonstrates that it is more likely than not that the gift giver understood the nature and consequences of the transfer, and intended to make it.

A Case Which Demonstrates This Doctrine

In the case of Gefen v. Gaertner (2019), a handful of gifts were voidable under the doctrine of unconscionable procurement. The deceased mother had elected to give more than 50% of her estate in inter-vivos gifts to one of her three children. The two children decided to challenge the transactions under the doctrine of unconscionable procurement. As described in the case, unconscionable procurement requires that a “person who obtains a benefit from another by voluntary donation must establish that the donor did so voluntarily and deliberately, knowing what they were doing.” The two children were able to successfully prove the two elements of unconscionable procurement, showing that their mother did not make these gifts voluntary and deliberately.

While not always the case, it is common for elderly people to give gifts that have been unconscionably procured. If the recipient of the gift is overly involved and pushing to receive a gift, this could be grounds for an unconscionable procurement claim.

If you or a loved one have been wronged through an unconscionably procured gift, contact an experienced estate lawyer today. We will help to ensure that you receive the inheritance you’re entitled to, even if that means making the gift voidable.

Have a question about this topic or a different legal topic? Contact us for a free consultation. Reach us via phone at 250-888-0002, or via email at info@leaguelaw.com.