The question of who gets to keep the engagement ring when the relationship ends is one that I often get from clients. Depending on the facts, my answer is sure to disappoint one party. In New Jersey, an engagement ring is considered a conditional gift. That is, it is a gift given conditioned upon the realization of a specific event. In this context, the event is the marriage. Simply put, if the engagement ends without the marriage taking place the condition has not been satisfied and the ring is to be returned to the giver. This is true regardless of which party calls off the engagement.
The outcome is completely different once the marriage has taken place. Now, the condition has been satisfied and the engagement ring is now the property of the recipient. Should the marriage end in divorce, the recipient would be entitled to keep the engagement ring.
Disputes over the engagement ring most frequently arise in a divorce when the engagement ring was a family heirloom. While using a family treasure as an engagement ring is a romantic gesture, it can lead to problems down the road. If you are using such a ring, you must be prepared for it to leave your family in the event of a divorce.
