Donations

What it is

A donation is a contract under which, in the spirit of liberality, one party enriches the other, by transferring a right to him or by taking over some obligation. The donation, then, is a contract: from this it follows that, once completed, it is generally irrevocable by either of the parties.
The essential elements of the donation are two:

• the spirit of liberality;
• the enrichment of the recipient.

How it is set up

An essential element of the donation is its form: in fact, it must be formalised by a public document in the presence of two witnesses; therefore, the involvement of a notary is necessary in order to dispose of assets by way of donation.

The need for a public document is justified by the importance of the gift and for the effect on the assets of the donor who must be capable of understanding and be fully aware of what he is doing and all its consequences. Advice from the notary is therefore very important in order to receive all necessary and appropriate explanations.

Effects

The donation is an appropriate instrument to satisfy many interests. In fact, special clauses (so-called “conditions” or “obligations”) can be inserted to meet some specific requirements (e.g. I give you this house in return for your caring for me).

A very common case is the donation of a property subject to usufruct in favour of the donor, which means that the giver relinquishes ownership of the property in advance, retaining for himself the right to occupy it, which will lapse automatically at the time of death (or the deadline); the donor who has reserved the usufruct will have the use of the property (e.g. he may live in it or be able to collect any rent) but will also bear the ordinary costs and any taxes.

Donation is an act subject to revocation, for some causes of ethical and social imperative. In particular, it can be revoked:

• for ingratitude of the recipient: that is, if the recipient has committed very serious acts against the donor or his property;
• for the arrival of children: that is, if the donor produces children or descendants, or finds out he has them after the donation.

A donation made to the donor’s forced heirs is considered by the law to be an advance inheritance, which means that, at the time of death of the donor, it must be attributed to the reserved quota.

Protection of forced heirs

With specific reference to the relationship between the donation and the future succession of the donor, it is necessary to know that the donation is an act “at risk”, which can prejudice the subsequent sale of the assets donated or the obtaining of a loan secured by the donated property.

The law, in fact, protects certain categories of relatives (forced heirs), allowing them a share of the inheritance (forced heirs) even contrary to a desire of the deceased expressed in a donation. These persons are the descendants (children and grandchildren), ascendants (parents, grandparents, and so on) and the spouse: if donations, though valid and enforceable, should, at the time of death of the donor and after very complicated calculations, be deemed harmful to the rights of a forced heir, the latter may take legal action to have them declared invalid (an “action for reduction”).

Protection of the forced heirs may also involve third parties who have acquired rights from the recipient of the donation (including banks which for the granting of a mortgage may have accepted a donated property as collateral). Indeed, if the recipient does not have sufficient assets to satisfy any claims of the forced heir, a claim may be made for return of the asset by the purchaser (an “action for restitution”), who may extricate himself with the payment of a corresponding amount.

It is useful to point out that the forced heirs cannot give up their right to sue as long as the person whose legacy is in question is still alive, even by giving their assent to the donation; only when the donor is dead may they acquiesce in the donation.