When an engagement is canceled, the promise of marriage is broken and the ring must be returned to the person who gave it. The value of the ring doesn't matter. The state of New Jersey takes a “no-fault” approach to broken commitments, meaning that the circumstances surrounding the breakup don't matter either. In most states where engagement rings are considered conditional gifts, the recipient remains the owner of the ring only if the marriage condition is met.
In most cases, the ring is returned to the purchaser if the couple separates. Courts that follow this approach don't care who is at fault. If the engagement is broken, the donor gets the ring back, regardless of the reason for the separation. Like a no-fault divorce, it's possible to resolve the matter without unpleasant arguments about who did what to whom.
Managing broken commitments in this way avoids addressing personal and emotional situations. Many courts classify engagement rings as a conditional gift and award the engagement ring to the donor in cases of broken engagement. In states that treat engagement rings as conditional gifts, most courts have ruled that the recipient must return the ring to the donor regardless of who was responsible for the couple's breakup. In some states, courts have determined that engagement rings are unconditional or absolute gifts that belong to the recipient, regardless of whether the couple goes ahead with the wedding.
Courts in some states, such as Texas, take the opposite approach and determine that the engagement ring must be returned when the recipient ends the engagement, but not if the donor was the one who called off the marriage. But again, the question of what happens to engagement (and wedding) rings after a divorce may depend on where you live. For example, the Montana Supreme Court determined that applying the conditional gift theory to engagement rings would violate Montana's policy (as in most states) of eliminating heart balm lawsuits based on breaches of the promise of marriage. Because of the unique nature of engagement rings and what they symbolize, very few states view engagement rings as unconditional gifts.
Courts often consult state laws and previous court cases to determine who is the owner of the engagement ring after a breakup. While the law varies as to who has the right to keep the ring, from an etiquette standpoint, it's generally considered polite to return the ring if the engagement is called off. Although the condition of marriage is often implied, most states consider an engagement ring to be a conditional gift. Some states, such as Montana, classify the engagement ring as an unconditional gift and grant the ring to the recipient in unfulfilled commitments.
Checking off all the legal requirements when buying a ring can help, but the breakup can still leave some questions unanswered.