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Law Offices of Ronald W. Rutz
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December 6,2003: Gifting Considerations

Q: I still remember your speech before our service club about Christmas gifting. Why donŐt you share that with the readers of the column?

A: I did have a lot of fun before your group. Remember what works orally may not translate successfully into pen and ink, but here it goes.

I remember very vividly sitting on SantaŐs lap (no it wasnŐt last year; I was four at the time). But I had legal questions even then. For example, what happens if Santa doesnŐt come through with the Christmas requests? Could a kid sue Santa to get the stuff?

Nowadays, I am told Santa listens but does not promise. In my day and to my young ears, it sounded like he did promise. But even if Santa did make a commitment, such a promise is considered a future gift without consideration. Thus I could not enforce such a bargain. But if I relied on the "promise" to my detriment, then I might have a cause of action. However, bragging to classmates at school and then eating crow later when the gift did not materialize probably would not sway a judge or jury and probably does not give rise to the level of detrimental reliance.

The cookies and milk left for Santa probably would not be considered adequate consideration and thus move the arrangement from a gift to a binding contract with consideration on both sides.

When I was four years old, I would have had the problem that Santa could have been considered mom and dadŐs agent. So any cause of action would be against my parents, not Santa, but at that time such a legal pursuit probably would have been barred by the legal chestnut that "a child cannot sue a parent on contractual matters."

But letŐs say that the gifts had been purchased and were found in their hiding places by inquiring little eyes and hands (like mine) or were actually placed under the Christmas tree. To constitute a gift that cannot be taken back, there must be parting of control so the giver has no legal right to take it back. Finding a hidden present probably indicates no intent to part with legal possession. Even if the present is under the tree, remember the saying that "Santa is watching to see if you are naughty or nice." Thus the judge or jury could easily find that possession did not pass until possession was intended to passŃwhen the gifts were to be opened (even if that was Christmas morning as opposed to Christmas Eve).

But once passed, the giver retained no right, unless specially so reserved, to take the present back. So Dad has no right to play with the train set to the exclusion of the giftee. What if the gift breaks or is faulty? Can you sue the giver? Probably not. Remember the old chestnut "never look a gift horse in the mouth." (But if dad actually breaks the trains, that might be a different matter.)

Another possible problem is that gifts in any calendar year cannot exceed $11,000 ($22,000 from both mom and dad). Possible gift taxes might have to be paid by the giver. So if Santa is in fact considered mom and dadŐs agent, and if during the year transfers such as birthday presents, "surprises," money for the movies, allowances, etc. exceed the exemption figure, the receiver does not have to worry about gift or income taxes, but the giver does. (I hope that all you kids have parents who may have gift tax considerations because they have remembered you so generously during the past year.)

Out of space so no more room to explore other legal options for the young aspiring legal eagles, but my advice as someone who has "been there and done that," just accept disappointment and frustration as part of growing up and forget about suing your parents or Santa.

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