Deciding who is entitled to keep the engagement ring is not a discussion couples would ever anticipate having when they’re embarking on the next chapter together. However, when a relationship breaks down unexpectedly this can be quite a contentious topic particularly in shorter relationships.
In the majority of cases, unless a couple had been living together for more than two years, the ring would be classified by the court as a gift. The law in respect to engagement rings needs to be considered in the following contexts:
- Couples that become engaged but do not live together before marriage (traditional engagement);
- Couples that live together, become engaged but they do not marry (de-facto couples);
- Couples that get engaged live together and then marry (married couples).
Papathanasopoulos v Vacopoulos (2007)
The leading authority is a NSW Supreme Court case: Papathanasopoulos v Vacopoulos [2007] NSWSC 502. In this case, the parties were engaged and 10 days later Ms Papathanasopulous called off their engagement. Mr Vacopoulos originally told Ms Papathanasopulous she could keep the ring as a gift. Ms. Vacopoulos elected to dispose of the $15,250 ring in the garbage together with any remaining photographs and memories of the couple. Mr. Papathanasopoulos then commenced proceedings seeking to recover the engagement ring or its value. The couple were not married or in a de facto relationship therefore, the Family Law Act did not apply. The Court classed the engagement ring as a “conditional gift”, with the condition being that the two parties would eventually marry. Should this marriage not go ahead, the Court said that the ring is to be returned to the person who gave that gift, unless there is legal justification not to return the engagement ring.
The Court then summarised the principles that apply to engagement rings, as follows:
- If a woman who has received a ring in contemplation of marriage refuses to fulfil the conditions of the gift, she must return the ring;
- If a man refuses to carry out his promise of marriage, without legal justification, he cannot demand the return of the ring;
- It is irrelevant whether the denial of the promise turns out to benefit both parties;
- If the engagement is ended by mutual consent, then in the absence of any agreement to the contrary, the engagement ring and similar gifts must be returned by each party to the other.
- The Court also commented that a woman could raise a plea of ‘legal justification’ for her refusal to carry out her promise of marriage if it was shown that there was ‘repudiatory’ conduct on the man’s part, such as violence or an affair. In those circumstances, it would be possible for the woman to keep the ring.
When does the Family Law Act Apply?
Where the Family Law Act does apply, meaning that the couple were either married or de facto, the engagement ring forms part of the asset pool for distribution. As is the case with any asset or liability in the asset pool, the question of who is entitled to it depends upon a variety of factors, including its value, the financial and non-financial contributions of each party and the parties’ future needs.
As is the case with other items of property in the property pool, the value of the engagement ring for the purposes of property settlement is the current second-hand value which is often much lower than the purchase price.
Chiara Nicolaci – Solicitor– Matthies Lawyers
Should you wish to obtain advice regarding your family law matters, please contact Matthies Lawyers for an obligation-free consultation or call +61 3 8692 2517 today.
Disclaimer: This article contains general information only and is not intended to be a substitute for obtaining legal advice.