Using someones upgrade

When you activate the phone it will kill his current sim. You can buy a sim adapter and use that or simply go to ATT and get a new one. You can actually do this tmr before the phone gets there.... they will give him a sim the correct size for his phone and after activation simply put the "new" sim in his old device and you're good to go.
I just did this with my brothers account and it has to have the sim in the phone to activate.

 

When you get the phone call AT&T and they will need the IMEI number and ICCID (the SIM) number from the iPhone box label. They will manually enter those numbers into your line number and then everything works without interruption to any lines on the account. After they do that you need to power cycle the new iPhone and complete the activation/setup following the screen prompts. Don't worry if it still shows the other number during the activation process- it will work if AT&T enters everything correctly. I just did this with 2 iPhones with no problems.

 

I followed this procedure and was able to activate a new iPhone on my line that was ordered for a different line on my account.