“In McNamee v. McNamee, 2011 ONCA 533, the Court of Appeal defined a gift in the family law context:
[23] Although the term “gift” is not defined in the Family Law Act, a gift, generally speaking, is a voluntary transfer of property to another without consideration: Black’s Law Dictionary, 7th ed. (St. Paul, MN: West Group, 1999), at p. 696; Birce v. Birce (2001), 2001 CanLII 8607 (ON CA), 56 O.R. (3d) 226, [2001] O.J. No. 3910 (C.A.), at para. 17. A transfer of property by contractual agreement involves a mutual exchange of obligations (“consideration”), but a transfer by way of gift involves a gratuitous, unilateral transaction: Mary Jane Mossman and William Flanagan, Property Law: Cases and Commentary, 2nd ed. (Toronto: Emond Montgomery Publications, 2004), at p. 439. As McLachlin J. observed in Peter v. Beblow, 1993 CanLII 126 (SCC), [1993] 1 S.C.R. 980, [1993] S.C.J. No. 36, at p. 991-92 S.C.R., “[t]he central element of a gift [is the] intentional giving to another without expectation of remuneration”.
[24] The essential ingredients of a legally valid gift are not in dispute. There must be (1) an intention to make a gift on the part of the donor, without consideration or expectation of remuneration, (2) an acceptance of the gift by the donee and (3) a sufficient act of delivery or transfer of the property to complete the transaction: Cochrane v. Moore (1890), 25 Q.B.D. 57 (C.A.), at pp. 72-73 Q.B.D.; Mossman and Flanagan, supra, at p. 441, Bruce Ziff, Principles of Property Law, 5th ed. (Toronto: Carswell, 2010), at p. 157.
[25] Some authorities have sought to refine or qualify these elements in various ways, but they remain the substance of a [page409] valid gift. Here, the trial judge found two qualifications to be significant. First, he concluded, correctly, that the donor must divest himself or herself of all power and control over the property and transfer such control to the donee….
In Teixeira v. Estate of Markgraf et al., 2017 ONCA 819 at para. 41-49, the Court of Appeal emphasized the delivery requirement to give legal effect a gift:
[40] The delivery requirement has been a part of the modern law of gifts since the seminal case of Irons v. Smallpiece (1819), 2 B. & A. 551. The delivery requirement is an important distinguishing feature of gifts as compared to other methods of transferring property, such as by contract. As Mossman and Flanagan note in Property Law: Cases and Commentary, at p. 442:
The delivery requirement marks an important difference between contract law and the law of gifts. A contract involves an exchange of promises. A gift, a unilateral promise, does not. Contract law will enforce an exchange of promises (a “bargain” promise) with expectation damages. On the other hand, the law of gifts attaches no significance to a unilateral promise to pay in the absence of delivery.
[41] The delivery requirement in the law of gifts continues to serve several important functions. It forces a would-be donor to consider the consequences of their expressed intention to make a gift and it furnishes tangible proof that a gift has in fact been made: see Bruce Ziff, Principles of Property Law, 6th ed. (Toronto: Carswell, 2014), at pp. 161-62. See, also, Philip Mechem, “Requirement of Delivery in Gifts of Chattels and of Choses in Action Evidenced by Commercial Instruments” (1926), 21 Ill. L. Rev. 341, at pp. 348-52. [page649]
Indicia of delivery
[42] The most obvious form of delivery is the actual physical transfer of the subject matter of the gift from the donor to the donee such that the gift is literally given away: see Ziff, at p. 161.
[43] However, in certain circumstances, such as where the item is unwieldy, courts have acknowledged that constructive delivery will suffice. In these cases, the critical questions have been whether or not the donor retained the means of control and whether all that could be done had been done to divest title in favour of the donee: see Ziff, at p. 165.
[44] Ultimately, in order for a gift to be valid and enforceable, the donor must have done everything necessary and in his or her power to effect the transfer of the property: Kavanagh v. Lajoie, [2014] O.J. No. 1120, 2014 ONCA 187, 317 O.A.C. 274, at para. 13.
Gifts by cheque
[45] A gift of cash can be readily effected by delivery to the donee. But a gift of money by cheque can be problematic, due to the nature of a cheque. A cheque is not money. Nor is it a transfer of property. It is a direction by the drawer (the bank’s customer) to the drawer’s bank to pay a sum of money to the payee: Bernard (Re), [1911] O.J. No. 792, 2 O.W.N. 716 (Div. Ct.), at p. 717 O.W.N. The direction can be revoked by the drawer at any time — for example, by a “stop payment” order, referred to in s. 167 of the BEA as “countermand”. Under s. 167, the bank’s authority to pay the cheque is terminated by countermand or when the bank receives notice of its customer’s death: McLellan v. McLellan (1911), 25 O.L.R. 214, [1911] O.J. No. 30 (Div. Ct.), at p. 216 O.L.R.; Beaumont (Re), [1902] 1 Ch. 889, at p. 894.
[46] For these reasons, a gift by cheque is not complete when the cheque is given to the donee. It is only complete when the cheque has been cashed or has cleared: see Ziff, at p. 166. Thus, in Campbell v. Fenwick, 1934 CanLII 109 (ON CA), [1934] O.R. 692, [1934] O.J. No. 285 (C.A.), a cheque given to the donee three days before the donor’s death and cashed a day before her death was found to be a valid inter vivos gift of the amount of the cheque. [page650]
[47] In Swinburne (Re), above, a case strikingly similar to this one, the Court of Appeal for England and Wales held that the death of the donor ruins a gift inter vivos by way of cheque if the cheque is not deposited before the donor dies. There, the donor had given the defendant a cheque shortly before her death. The bank refused to honour the cheque because of concerns about the validity of the signature. Before anything else could be done, the donor died. On the date the cheque was presented, the donor had insufficient funds in her current account, on which the cheque was drawn, but sufficient money to cover the cheque in her deposit account. In light of evidence given by the bank that it might honour a cheque in such circumstances, the court considered the case as though the whole amount was in the current account.
[48] Nonetheless, the court held that a gift inter vivos was not made out. In reaching this conclusion, Warrington L.J. wrote, at p. 44 1 Ch.:
[I]n order to make an effectual gift inter vivos there must be an actual transfer of the subject of the gift or of the indicia of title thereto. A cheque is not money. It is not the indicia of title to money. A cheque is nothing more than an order directed to the person who has the custody of the money of the [donor] requiring him to pay so much to the person in whose favour the cheque is drawn.”