Every year, not long after 20 May (“520”, the Chinese internet’s unofficial day of love), there’s always news of a couple falling out and ending up in court. Just last month, shortly after 520 had passed, a story broke: “Man sues ex-girlfriend for the return of 21 ‘520’ red packets.”

In recent years, there has been more and more news about couples demanding the return of “red packets” and “gifts” after a break-up. The courts have taken the view that transfers such as “520” and “1314” are unconditional gifts expressing affection and cannot be clawed back, whereas other sums obtained for the purpose of marriage are property acquired without a lawful basis, constitute unjust enrichment, and must be returned in accordance with the law.

So in Australia, if a couple breaks up and one party wants to reclaim the gifts and money given during the relationship, is that actually possible? Today we look at whether, in Australia, you really have a chance of making your ex return the gifts after a break-up.

Case study

Let’s start with an example

Last year there was a story like this:

A Melbourne couple broke up and ended up in court over the ownership of a Pomeranian dog. The couple had been together since June 2017 and ended the relationship in 2019. During the relationship, the man spent AUD 4,000 buying the Pomeranian as a gift for the woman. After the break-up, the woman left with the dog. The man first sent a text message and then a solicitor’s letter asking her to return the dog. A month later, he took his ex-girlfriend to court, seeking ownership of the Pomeranian.

However, the magistrate dismissed the man’s claim, holding that the dog was a gift that the man had bought for his ex-girlfriend and that it should remain hers.

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How is a “gift” defined in law?

A gift (gifting) is the giving of something without receiving any benefit in return. In many respects it resembles a transaction without an exchange.

What counts as a valid gift?

It must be money or some form of personal property;

It must be given voluntarily;

It must be unconditional, i.e. given without expectation of any return;

A charitable act that brings no benefit to the giver

So, as the opening example shows, if a person gives a gift during a relationship entirely voluntarily and unconditionally, then even after the break-up the gift generally cannot be reclaimed.

There is, however, one exception: where engagement or wedding rings are involved, the position is different.

A leading case

Papathanasopoulos v Vacopoulos [2007]

There is a well-known case, Papathanasopoulos v Vacopoulos [2007], which raised the following question: if a party accepts an engagement ring on the basis that they will marry, but later changes their mind, must they return the ring? The court’s answer was yes.

In this case, Andrew Vacopoulos and Vicki Papathanasopoulos became engaged on 6 August 2005, when Andrew gave Vicki an engagement ring worth AUD 15,250. About 10 days later, the relationship deteriorated, and Vicki decided to call off the wedding and asked Andrew to take the ring back, but Andrew refused. Andrew said to Vicki: “The ring is a gift, you keep it.” Vicki then kept the ring, and soon afterwards Vicki’s father threw the ring, together with other items connected with Andrew, into the bin.

Shortly after that, Andrew commenced proceedings asking Vicki to return the ring or pay its monetary equivalent, on the basis that the gift of the ring was conditional — the condition being that Vicki would marry him. Since she did not marry him, the condition of the gift was not satisfied, and the gift should therefore not belong to her.

Vicki argued that, although the ring was a conditional gift when Andrew first gave it to her, when the relationship ended and Andrew refused to take it back, the ring became an absolute gift. Accordingly, even though she did not marry Andrew, the ring was hers and she could deal with it as she wished.

The court cited the 1926 case of Cohen v Sellar, which set out the legal principles relating to engagement rings:

1. If a party receives a ring on the condition of marriage but fails to perform the condition of marriage, then after the break-up the recipient must return the ring.

2. If the party who gave the ring, without lawful justification, refuses to perform the promise of marriage, then the return of the ring cannot be required.

3. If both parties agree to end the engagement, then in the absence of an agreement to the contrary, the engagement ring and other similar conditional gifts must be returned to the giver.

At first instance, the magistrate held that, once Andrew had refused to take the ring back, Vicki became the bailee of the ring — that is, she held the ring but did not own it. She therefore had no right to dispose of it or throw it away at will. When Andrew learned that the wedding had been called off, he may well have wanted to salvage the relationship and hope that it could continue. That did not change the nature of the gift.

Vicki appealed, but the appellate judge upheld the original decision. Although it is not a very romantic way of putting it, the judge considered that marriage is, to some extent, similar in nature to a commercial transaction and is accordingly subject to the rules of contract law. In plain terms: a person who fails to perform their obligations under a contract cannot get their deposit back.

In this case, that meant that once the engagement was terminated, even though Andrew had initially refused to take the ring back, Vicki — as the party who had terminated the engagement — also lost ownership of the engagement ring. In the end her appeal was dismissed and she was ordered to pay Andrew’s legal costs as well as the monetary equivalent of the ring.

Final thoughts

From a lawyer’s perspective it may not be very romantic, but that is the reality of relationships: when things are sweet, the two of you are inseparable and nothing is “yours” or “mine”; once things sour, every cent is counted and you don’t want your ex to get away with a thing. From small items such as the gifts and rings discussed here to larger assets such as real estate and other fixed property, as lawyers we would always recommend putting a relevant agreement in place in advance, so that when things do fall apart you are not left with neither the relationship nor the assets.