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Gifts of Real Estate

Normally, a conveyance of real property has to be in writing. However, a gift of realty can be made in two ways: either by deed or by parol (oral) gift of real estate. To relieve a parol (oral) gift of real estate from the requirement of a writing, one must show three elements: (1) a gift in praesenti, that is, a present gift; (2) possession under the gift by the donee with the donor’s consent; and (3) permanent and valuable improvements, made on the property by the donee with the donor’s knowledge or consent or, without improvements, the existence of such facts as would make it a fraud upon the donee not to enforce the gift. To be a present gift, the donor must, at the time he makes it, intend an immediate divestiture of the rights of ownership out of himself and a consequent immediate vesting of such rights in the donee. The three elements which constitute a gift are (1) donative intent, (2) delivery of the property, and (3) acceptance of the property. All dominion and control over the property must be released by the owner. The party claiming a parol gift has the burden of establishing these elements.

Example Case

The Houston court of appeals has ruled that there was a parol gift of land when one brother gave another brother a document that said that – I give my brother all of my interest in our parents estate – followed by the brother living on the land in question for many years exclusively.

The parties contesting the alleged parol gift also argued that, even if it is a parol gift, it must fail because the document lacks a sufficiently specific description of the property conveyed, citing Republic National Bank of Dallas v. Stetson, 390 S.W.2d 257 (Tex. 1965). In that case, the Texas Supreme Court stated the general rule that “the description in a written conveyance must furnish within itself or by reference to some other existing writing, the means or data by which the particular land conveyed can be identified.” Id. at 262-63. Concluding that an alleged parol gift of undescribed land to Stetson was void, the Court went on to state: “We can think of no reason that the description of land which is the subject of a parol gift should not be governed by the settled rule for written conveyances. Indeed the dangers which the statutes sought to guard against are greater in the case of oral conveyances.”

The Houston court went on to distinguish the present case from the Supreme Court case holding that the description was sufficient to properly identify the land. The court said “Here, as evidenced by the writing and the other evidence discussed above, Rudy made a parol gift of his interest in his father’s estate to Karl. There is no dispute that Rudy, Karl, and Charlotte each inherited an undivided 1/3 interest in the real property at issue from their father. Nor is there any dispute about the description, location or boundaries of this real property. Therefore, the Texas Supreme Court’s stated policy and reasoning against parol conveyances of land do not pose a stumbling block in this case.” No. 14-06-00787-CV. This case makes clear that proving a parol gift of land is difficult. Although the parties succeeded in this case, this case is the exception rather than the rule.

A 2015 case on a parol gift of land is here.