Can You Gift Someone Property Just Because You Love Them?

According to property law, it does seem like love is legally recognised, and you can transfer a property over to a parent/child/spouse. But wait, there's more to it than just a simple name change!
Section 26 contract act 1950, Property law, Common law, Gift property, Property transfer

Love. It’s a complex emotion. One minute you’re screaming at someone for not putting their dirty clothes in the right basket, and the next you’re trying to find ways to gift them a piece of property.

There's actually an existing provision for this kind of property transfer in Malaysia. The gift property bit we mean, not the wrong baskets confusion!

But since it’s based on some common law we inherited from our often confusing colonial systems of old, it can be a bit of a complex picture of when and how it applies.

 

When Is Love Taken Into Consideration?

Property law isn’t always straightforward. Sometimes it requires a little bit of ‘nuance’. The laws around love and affection transfers are one area worth understanding. 

Standard contract law normally requires an element called ‘consideration’. Without going into a full technical explanation of this, it essentially means if there's a contract to give you something, the contract must include a reference to something given in return. 

A contract must have an obligation for both parties to give the other party something. There are some exceptions to that however.

Section 26 contract act 1950, Property law, Common law, Gift property, Property transfer

While fundamental common law doesn’t recognise the idea of ‘love and affection’, there's a crucial element of law relating to these transfers – Section 26(a) of the Contract Act 1950. Here’s how it reads, and sure, this is getting prettyyy technical:

“An agreement made without consideration is void, unless –

it is in writing and registered

(a) it is expressed in writing and registered under the law (if any) for the time being in force for the registration of such documents, and is made on account of natural love and affection between parties standing in a near relation to each other;

or is a promise to compensate for something done

(b) it is a promise to compensate, wholly or in part, a person who has already voluntarily done something for the promisor, or something which the promisor was legally compellable to do; or

or is a promise to pay a debt barred by limitation law

(c) it is a promise, made in writing and signed by the person to be charged therewith, or by his agent generally or specially authorized in that behalf, to pay wholly or in part a debt of which the creditor might have enforced payment but for the law for the limitation of suits.”

OH MY LEGAL! Okay, no need to panic, yet. It’s clause (a) that really gets us through here. Basically what this means is: love IS recognised!

Section 26 contract act 1950, Property law, Common law, Gift property, Property transfer

Natural love and affection is a valid part of contract law in Malaysia, and may validate a contract without consideration. Love is consideration enough guys!

It does however set out that an agreement must be expressed in writing, registered, and that parties stand in ‘near relation’ to each other.

So, love is recognised. The law says so. You still need a signed and stamped contract. Love conquers all! Apart from maybe, you know, bureaucracy.

 

So I Need A Clear Contract?

Yes! Even though natural love and affection is recognised in Malaysia, a formal written and registered document is still required as evidence that a contract has been agreed by both parties.

Don’t go worrying yourself that you need some uniquely complicated contract though. The Memorandum of Transfer (MoT) or Deed of Assignment are both tried-and-tested contract choices for a love and affection transfer of property.

You do not need a Sales and Purchase Agreement (SPA) in order to transfer a property through love and affection.

Section 26 contract act 1950, Property law, Common law, Gift property, Property transfer

While these documents are, in many ways, standard transfer documents, you should still ensure you have professional legal advice and oversight to complete the transfer in an appropriate way:

  • Memorandum of Transfer - Used in cases where an Individual Title or Strata Title exists for the property which the owner wishes to transfer to the recipient. 
  • Deed of Assignment - Used in cases where no Individual Title or Strata Title has yet been received, usually in scenarios where a developer has not yet registered individual titles for a strata property.

You need to get this document stamped just like any other property transfer! That means official stamping by a lawyer to witness and authenticate the agreement.

 

Stamp Duty Exemption For Love Transfers

Good news if you were worried about paying out big for love and affection — stamp duty exemptions exist in Malaysia for love transfers of property. 

Stamp Duty Exemption for Love and Affection Transfer

Husband to wife

100%

Wife to husband

100%

Mother and/or father to child

50%

Child to mother and/or father

50%

Note that since January 2020, the stamp duty exemption for transfer from parent to child is only valid if the recipient is a Malaysian citizen.

Section 26 contract act 1950, Property law, Common law, Gift property, Property transfer

It’s not all free of course! You will still have to pay legal fees for the professional legal services undertaken to transfer the property.

In the case of a love transfer, this will be charged based on the market value of the property itself.

Property Purchase Mandatory Legal Fees

Property Value

Scale of Fee

First RM500,000.00 (Subject to a minimum fee of RM500.00)

1%

For The Next RM500,000.00

0.8%

For The Next RM2,000,000.00

0.7%

For The Next RM2,000,000.00

0.6%

For The Next RM2.5 mil

0.5%

For excess of RM7.5mil

0.5%

 

What Is Love (Baby Don't Hurt Me)?

This all got a bit technical, so we thought we’d reward you with some of the hot takes on what love is from around the world!

Section 26 contract act 1950, Property law, Common law, Gift property, Property transfer

“We are all a little weird and life’s a little weird, and when we find someone whose weirdness is compatible with ours, we join up with them and fall in mutual weirdness and call it love.” Robert Fulghum

“How shall my heart of a mere grass seedling, repay the embrace of the spring’s warm sun.” Meng Jiao

“A love that is brief is love nonetheless.” Maori proverb

“This was love: a string of coincidences that gathered significance and became miracles.” Chimamanda Ngozi Adichie, Half of a Yellow Sun.

“To get the full value of a joy you must have somebody to divide it with.” Mark Twain

“Very quietly I take my leave. As quietly as I came here. Gently I flick my sleeves. Not even a wisp of cloud will I bring away.” Xu Zhimo

There’s no need to be heartbroken about leaving this world, when you can pass property on to those you love too!

Contract law may not be as beautiful as Xu Zhimo’s poetry, but it’s pretty helpful when you want to transfer your house for love and affection.

 

Want to find out more about transfer of property? Explore our guide on What Is A Master Title And Why Is It So Important?

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