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General Principle:

Where a donor had manifested an immediate and irrevocable intention to donate shares to another, signed a transfer form to this effect and instructed an agent to complete the transfer of the legal title to shares in a private company, the donor can no longer deny the interest acquired by the donee.


Pennington v Waine [2002] EWCA Civ 227


Ada Crampton wanted to transfer 400 of her shares in a company to the second defendant- her nephew Harold Crampton- and to make him a director thereof which, under the articles of association, required the second defendant to hold at least one share in the company. Ada signed a share transfer form and the company's auditors wrote to the second defendant to inform him of the share transfer and asking that he complete the prescribed form of consent to act as a director. The second defendant signed the form and it was countersigned by Ada. The signed share transfer form was retained by the auditors and was not sent to the second defendant. Ada died having executed a will in which she made specific gifts of the balance of her shareholding but made no mention of the 400 shares. In an action brought by the executors of Ada’s estate the fifth and sixth defendants, who were residuary beneficiaries under the will, sought a determination of whether there had been a valid equitable transfer of the shares.


The Court held that since the gift of 400 shares became effective when Ada signed the transfer form there was no requirement for the form to be delivered to either the second defendant or the company in order to make the gift complete, and the shares did not form part of C's residuary estate. As Arden LJ has put it in this case:

“Thus explained, the principle that equity will not assist a volunteer at first sight looks like a hard-edged rule of law not permitting much argument or exception. Historically the emergence of the principle may have been due to the need for equity to follow the law rather than an intuitive development of equity. The principle against imperfectly constituted gifts led to harsh and seemingly paradoxical results. Before long, equity had tempered the wind to the shorn lamb. It did so on more than one occasion and in more than one way.”

Clarke LJ said in Pennington v Waine:

“Lord Browne-Wilkinson highlighted the contrast between the maxim that equity

will not aid a volunteer and the maxim that it will not strive officiously to defeat a

gift. It seems to me that if equity refuses to aid Harold on the facts of this case,

it will prefer the former maxim to the latter, whereas all the circumstances of the

case lead to the conclusion that it should give effect to the gift which Ada



Where the donor has done everything he could to express his intention of transfer to the donee; he is no more permitted to deny the interest acquired by the donee.

Pennington v Waine


In Pennington v Waine (2002), it was held that equity will regard the gift as complete if the stage has been reached where it would be unconscionable for the donor to withdraw. In Curtis v Pulbrook (2011), it was held that Pennington was a case of proprietary estoppel; where the donee has acted to his detriment in reliance on an assurance, the donor cannot withdraw.

Pennington v Waine

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