In the 'flag colors' example, what is the legal effect of using external actions to designate property to a child?

• A. It will be upheld
• B. It will be invalid due to lack of intent
• C. It will not have legal effect due to acts of independent significance
• D. It will be interpreted as a valid encoding

Answer: (D)

Symbolic actions can transfer property when they function as an encoding of the designation. In the flag colors scenario, the external actions serve as an objective signal that the child is the intended recipient, not just a private wish. Because those observable acts carry meaning and are capable of being understood as a transfer by others, the law treats them as encoding the gift, making the transfer legally effective. This is why the designation is considered a valid encoding and has legal effect. The other options rely on traditional forms of transfer or assume lack of effect from external signs, but when the act itself encodes the designation, it can be recognized as a valid transfer.