Gifts, Burdens, and Last Wills: Can a Donor Revoke a "Gift Causa Mortis" After the Donee Performs Their Obligations?

Date of Judgment: April 30, 1982 (Showa 57)
Case: Supreme Court of Japan, Second Petty Bench, Case No. Showa 56 (o) No. 487 (Claim for Confirmation of Will Invalidity)

A "gift causa mortis" (死因贈与 - shi'in zōyo) is a gift made by a donor during their lifetime that is intended to take effect only upon the donor's death. Under Japanese law (Article 554 of the Civil Code), provisions concerning testamentary gifts (devises or 遺贈 - izō) generally apply to these gifts causa mortis. Since devises are typically freely revocable by the testator through a later will (Articles 1022 and 1023 of the Civil Code), a question arises: can a donor similarly revoke a gift causa mortis simply by making a subsequent, conflicting will? This issue becomes particularly complex when the gift causa mortis was made with a "burden" (負担 - futan) attached—an obligation the donee was required to fulfill—and the donee has already performed that burden. The Supreme Court of Japan addressed this nuanced situation in its decision on April 30, 1982.

Facts of the Case: A Father's Promise, A Son's Performance, and Conflicting Wills

The case involved a contractual agreement between a father, A (the donor), and his eldest son, X (the donee and plaintiff/appellant).

• The Gift Causa Mortis with a Burden (1960): On May 3, 1960, A and X entered into a formal agreement for a gift causa mortis with a burden. The terms were:
  • X's Obligation (the Burden): As long as X remained employed, he was to provide his father, A, with a monthly sum of at least ¥3,000. Additionally, X was to give A half of his biannual employment bonuses.
  • A's Corresponding Promise (the Gift): If X faithfully fulfilled this ongoing financial support obligation, A promised to gift his entire estate to X upon A's death.
• X's Alleged Performance of the Burden: X asserted that he had consistently fulfilled this financial support burden, providing the agreed-upon sums to his father, A, from the time of the agreement until X's retirement from his company on March 31, 1979.
• A's Subsequent Conflicting Wills: Despite the 1960 agreement with X, A later executed two holographic (handwritten) wills, one dated November 16, 1974, and another dated September 22, 1977 (collectively referred to as "the Later Wills"). These wills contained provisions that directly contradicted the earlier promise to leave his entire estate to X. Specifically, the Later Wills:
  • Devised parts of A's property to his second son, Y1, and his third daughter, Y2.
  • Stipulated that the remainder of A's estate should be divided among A's wife, X (the eldest son), Y1, and Y2, according to their statutory inheritance shares, and that this division should be done peacefully.
  • Appointed a lawyer, Y3, as the will executor.
• A's Death and the Ensuing Dispute: A passed away on May 10, 1979.
• X's Lawsuit: Following A's death, X filed a lawsuit against Y1, Y2 (his siblings who benefited under the Later Wills), and Y3 (the appointed will executor; collectively "Y et al.," the defendants/appellees). X's primary argument was that, due to his complete and faithful performance of the financial support burdens specified in the 1960 gift causa mortis agreement, he had acquired a vested right to A's entire estate upon A's death. Consequently, X contended that the Later Wills executed by A were invalid because they attempted to dispose of property that, by virtue of the fulfilled gift causa mortis contract, was no longer part of A's bequeathable estate (as it had effectively been promised and "earned" by X).
• The Defense by Y et al.: Y et al. countered by arguing that even if the 1960 gift causa mortis contract with X had been validly formed, it was legally revoked by A's Later Wills. Their argument relied on Article 554 of the Civil Code, which states that provisions concerning devises apply mutatis mutandis (with necessary changes) to gifts causa mortis. Since devises are freely revocable by a testator through a subsequent will that expresses a conflicting intent (as per Articles 1022 and 1023 of the Civil Code), Y et al. asserted that the gift causa mortis to X was similarly revoked by A's Later Wills.
• Lower Court Rulings Against X: Both the first instance court and the High Court ruled against X, dismissing his claim. These courts accepted the defendants' argument, straightforwardly applying the rules for the revocation of devises to the gift causa mortis made to X. They held that A's Later Wills, being inconsistent with the earlier gift causa mortis, effectively revoked that gift, irrespective of X's alleged performance of the burden.
• X's Appeal to the Supreme Court: X appealed this decision. His core argument before the Supreme Court was that the lower courts had erred in their application of the law. X emphasized that for gifts causa mortis that include a burden (負担付死因贈与 - futan-tsuki shi'in zōyo), particularly where the donee has substantially performed that burden, Article 553 of the Civil Code should also be considered. Article 553 states that provisions concerning bilateral (two-sided) contracts apply to gifts that impose a burden on the donee, at least to the extent of that burden. X argued that this provision, reflecting the somewhat reciprocal nature of such gifts, should negate or significantly limit the donor's ability to freely revoke the gift by simply applying the devise revocation rules (Articles 1022/1023 via Article 554), especially after the donee's performance.

The Supreme Court's Decision: Protecting the Donee Who Performed the Burden

The Supreme Court overturned the High Court's decision and remanded the case for further proceedings, establishing an important limitation on the revocability of gifts causa mortis when a burden has been performed.

The Supreme Court's core principle was:
In cases of a gift causa mortis with a burden, where the burden is stipulated to be performed during the donor's lifetime, and the donee has duly performed all of that burden, or a substantial part of it that is equivalent to full performance, it is not appropriate to apply the rules concerning the revocation of wills (Civil Code Articles 1022 and 1023) via Article 554 without restriction.

The Court reasoned that:

• To allow a donor to freely revoke such a gift after the donee has fulfilled their obligations would be to excessively prioritize the donor's final wishes at the unfair sacrifice of the donee's legitimate interests and reliance on the contract.
• Therefore, in such circumstances, the gift causa mortis contract should not be deemed revoked by a later conflicting will unless there are "special circumstances" (特段の事情 - tokudan no jijō) that would make it unavoidable or equitably necessary to permit the revocation of all or part of the gift, despite the donee's performance.
• The assessment of whether such "special circumstances" exist requires a comprehensive consideration of various factors, including:
  • The original motives and reasons for concluding the gift causa mortis agreement.
  • The relative values of the burden undertaken and performed by the donee compared to the value of the property gifted by the donor.
  • The personal and family relationships between the donor, the donee, and other interested parties.
  • Other relevant life circumstances and the overall context of the agreement and its performance.

Remand for Factual Assessment:
The Supreme Court found that the lower courts had erred by mechanically applying the devise revocation rules without adequately considering whether X had indeed performed the stipulated burdens and, if so, whether any "special circumstances" existed that would nonetheless justify A's revocation of the gift through the Later Wills. The case was therefore remanded to the High Court for these crucial factual issues to be properly examined in light of the principles articulated by the Supreme Court.

Legal Principles and Significance

This 1982 Supreme Court decision is a landmark judgment that significantly clarifies the law on the revocability of gifts causa mortis, particularly those involving a burden performed by the donee.

• The Role of Article 554 and Devise Rules: The PDF commentary explains that Article 554 makes the rules applicable to devises (testamentary gifts) generally applicable to gifts causa mortis because both types of disposition share the characteristic of transferring property effective upon the donor's/testator's death. However, the precise scope of this "mutatis mutandis" application has always been a subject of legal debate, especially given that a gift causa mortis is a bilateral contract, whereas a devise is a unilateral act by the testator.
• Revocability: Devises vs. Gifts Causa Mortis:
  • Devises are, by their nature, generally freely revocable by the testator at any time before death (Articles 1022, 1023 of the Civil Code). This freedom is considered essential to ensure that the testator's final wishes are accurately reflected.
  • Applying this principle of free revocability wholesale to gifts causa mortis, which are contracts, has been contentious. Some legal scholars argued for free revocability (to prioritize the donor's final intentions), while others argued against it (to protect the contractual rights and legitimate expectations of the donee).
  • Prior Supreme Court case law (e.g., a decision from Showa 47.5.25 - May 25, 1972) had generally affirmed the application of devise revocation rules to ordinary (non-burdensome) gifts causa mortis, allowing them to be revoked by a later will.
• The Crucial Impact of a "Burden" (Futan) and its Performance: This 1982 Supreme Court decision carves out a vital distinction for gifts causa mortis that include a burden which the donee has performed during the donor's lifetime.
  • Article 553 of the Civil Code stipulates that, for gifts that impose a burden on the donee, provisions concerning bilateral (two-sided) contracts apply to the extent of that burden. This acknowledges the somewhat reciprocal nature of such gifts, making them less purely gratuitous than simple gifts or devises.
  • The Supreme Court, in this judgment, gave significant weight to this aspect. It recognized that when a donee has faithfully performed their side of the agreement (i.e., fulfilled the burden, especially one that required ongoing effort and performance during the donor's lifetime, as X's financial support did), their interest in the promised gift deserves a higher degree of legal protection. Their reliance and performance create a more vested interest than that of a recipient of a purely gratuitous devise or an unburdened gift causa mortis.
• Balancing the Donor's Final Intent with the Donee's Reliance and Performance: The decision carefully balances two important legal principles: the general respect for a donor's/testator's ability to change their mind about the disposition of their property (their "final wish") and the need to protect a contracting party (the donee) who has relied on and performed their obligations under an agreement. The Supreme Court concluded that after substantial performance of a significant burden by the donee, the donor's freedom to revoke the gift causa mortis is significantly curtailed. The donor's "final wish," as expressed in a later will, cannot automatically and without further justification override the donee's interest that has been solidified by their performance, unless compelling "special circumstances" warrant such revocation.
• What Constitute "Special Circumstances" Justifying Revocation?: The judgment leaves the precise definition of "special circumstances" to be determined on a case-by-case basis. However, the PDF commentary suggests that such circumstances might include situations analogous to those that would justify revoking ordinary gifts, such as:
  • Acts of serious ingratitude (忘恩行為 - bōon kōi) by the donee towards the donor.
  • A fundamental and unforeseen change in the circumstances of the parties that makes upholding the original gift deeply inequitable or contrary to the donor's core interests that perhaps could not have been anticipated.
  • A gross disparity in value where the burden performed was trivial compared to the gift, and other equities favor revocation.
• A Shift Towards a "Limited Affirmative Theory" (限定肯定説 - Gentei Kōteisetsu) of Revocability: The PDF commentary situates this Supreme Court decision within a broader scholarly and jurisprudential trend that, even for ordinary (unburdened) gifts causa mortis, argued for limiting the donor's freedom of revocation. This "limited affirmative theory" suggests that revocation should only be permitted when it does not contradict fundamental principles of justice and equity, or unfairly harm a particularly deserving donee's legitimate expectations. The 1982 judgment, by strongly protecting a donee who has performed a burden, aligns closely with and significantly strengthens this line of thought for burdensome gifts causa mortis.

Conclusion

The Supreme Court's 1982 decision is a landmark in Japanese contract and inheritance law. It establishes that while gifts causa mortis are generally subject to the rules governing devises, including those on revocation, this principle is substantially modified when the gift includes a burden that the donee has performed during the donor's lifetime. In such cases, the donor's freedom to revoke the gift through a later, conflicting will is not absolute. The gift can only be revoked if "special circumstances" exist that make the revocation unavoidable or equitably necessary, despite the donee's performance. This ruling underscores the importance of fairness and the protection of reliance interests in contractual relationships, even those that are to take effect only upon death, and carefully balances these with the traditional respect afforded to a person's final testamentary intentions.