A donation agreement is one of the forms of the gift contract defined by the Civil Code of Georgia and constitutes the legal foundation of grant and charitable funding. Under a gift contract, the donor gratuitously transfers property to the donee into the latter's ownership with the donee's consent. The particular character of grant relationships lies in the fact that the parties may stipulate that the validity of the gift contract depends on the performance of a certain condition or the achievement of a defined purpose, and that purpose may also be of common benefit — such a gift is precisely what is called a donation. For the recipient organisation this means that the property received is used for the restricted purpose, and for the donor — that the ways of refusing the contract and reclaiming the property are confined to the grounds established by the Code. Precise knowledge of these norms spares both the donor and the recipient organisation disputes over the designation and use of the funds.
Conditional purpose and the right to demand performance
In the donation model, the donor transfers the property within the framework of a defined purpose. Under the Code, performance of the condition may be demanded not only by the donor but also by the person in whose interest the condition was stipulated — which means that where a donation is designated for a specific beneficial purpose, a person acting in the interests of that purpose may also demand performance of the condition. If the donee fails to perform the stipulated condition, the donor may refuse the contract. When drafting a grant agreement, precise formulation of the purpose, the conditions and the performance mechanism, derived from these norms, is decisive.
Moment of conclusion and form of the contract
The moment at which a gift contract is concluded depends on the type of property: for a movable thing, the gift contract is considered concluded from the moment of transfer of the property, while for immovable property — from the moment of registration in the public registry of the right of ownership defined by the contract. A promise of a gift, in turn, gives rise to an obligation to give only if it is made in written form — an oral promise creates no legal obligation. Accordingly, every stage of granting a donation — the promise, the transfer and the registration — is linked to a different legal consequence, and ignoring this distinction often turns into a contested circumstance.