Gifting to charities... how do they get around it?

[Queenbee]

Just a quick musing really,
We all know that when a horse changes hands and in essence is gifted to another to make it a legally recognised transaction a small nominal fee of about £1 is given to the old owner, this is pretty widely known.

So how do the charities get around this, I have never heard of such a thing happening when an owner gifts a horse to a charity, and yet the charity claim full ownership and rights over the horse and the old owner has none? Infact, it is not entirely uncommon for some smaller charities to ask for the owner to donate to the charity a sum along with the horse, so the charity gives nothing... no exchange. I am not slating the charities, they are much needed, valued and do amazing work. But I do question the legality of this. How can they do it, when we the lay people are constantly told its not legal unless a nominal fee of £1 is paid?

 

[Goldenstar]

It's perfectly legal to give away a horse.
Or a house or a dog or anything.
But if the giver then changed their minds and decided the gift was a loan then your in a he said she said situation
A reciept for a notional fee is a cheap way of getting round that.
I was given a horse did not pay a £1 or anything but the owner signed a letter forming a contract with me I assume when you give a horse to a charity you sign a contract.

 

[Polos Mum]

I suspect the contract will say that £1 was paid even though no money ever really changes hands.

 

[Goldenstar]

I think the £1 is just a horsey custom I think a horse is any different in law to any other gift.
As I said I did not give a £1 and my father a lawyer looked over the letter we exchanged which basically said the owner gave the horse to me she did not want it back and I could not change my mind and return him.
From my side I stated is was my intention to PTS the horse if it did not come right and I did not need to refer to the old owner to make any desisions.
My father said that the letter was binding on both of us.

 

[Queenbee]

I think the £1 is just a horsey custom I think a horse is any different in law to any other gift.
As I said I did not give a £1 and my father a lawyer looked over the letter we exchanged which basically said the owner gave the horse to me she did not want it back and I could not change my mind and return him.
From my side I stated is was my intention to PTS the horse if it did not come right and I did not need to refer to the old owner to make any desisions.
My father said that the letter was binding on both of us.

Interesting, whenever I have taken on a horse I have always insisted I pay £1, made me feel safer, I never wanted to work on a damaged horse and get it better and risk the person coming back and wanting it now it was all pretty and foot perfect, I wanted to be able to be in control of what happened to the horse and where it went. I supposed without the £1 I would have felt a little bit exposed.

 

[JillA]

If you pay a nominal sum of £1 you would normally get a receipt for it - that is evidence of the contract. For gifting, normally the owner would sign the horse over, and the paperwork would include all evidence that ownership has passed and the new owner has total rights over the horse.
Probably not relevant with horses these days, but if you gift a capital asset of any kind, HMRC can regard it as remaining part of your estate for the purposes of Inheritance Tax if you die within a certain time - I think it is 6 years but I stand to be corrected. It operates a sliding scale of percentages in the period up to that limit, just to ensure people don't do it to avoid paying tax. I suspect that is where the custom began, but the same applies to a nominal sum or what they call "undervalue", for the same reasons.

 

[Natch]

I would guess that the charities have forms to fill in to confirm that you wish to sign over ownership.

The £1 custom may be common knowledge, but that doesn't necessarily make it the only legal way to transfer ownership of a horse

 

[cbmcts]

It might be something to do with the wording in a typical charity contract - I think it says 'surrender' the animal to the charities care or similar. Also they probably have some protection in law by virtue of being a charity, it would be extremely difficult for a former owner to argue that they thought it was only temporary/a loan if they were dealing with a registered charity who could prove that they always operated in a certain way. Completely different to the type of conversation/email/text that that would be normal between 2 people who were discussing a change of ownership.