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Case sharing 1, if parents contribute to the purchase of a house for their children after marriage, is it considered a gift or a loan?

author:Benevolence
Case sharing 1, if parents contribute to the purchase of a house for their children after marriage, is it considered a gift or a loan?

Parents in a mini-case series contribute to their children's home purchase

Brief facts of the case:

After Xu X 2 and Lu X 1 got married, Xu X 2's parent Xu X 1 contributed to the young couple's house purchase, and the house money was directly transferred to Xu X 2. Later, when they divorced, Xu X 1 claimed that the capital contribution was a loan, and took out Xu X 2's IOU and asked the young couple to bear it together.

Other details:

First, the borrowing is not compatible with the bank;

Second, the real estate rights holder is registered as Lu X 1, Xu X 2 and Xu X 3, the child born to Xu X 2 and his ex-wife,

Third, Lu Mou1 also contributed to the house,

Fourth, the IOU presented by Xu X 1 shows that the IOU was formed on September 21, 2016, and the statement written by Xu X 2 and Lu X 1 for the purchase of the house was formed on September 23, 2016, and the first half of the statement clearly recorded the borrowing situation, and even the RMB 240,000 from Xu X 2's mother, Lu X 2, was clearly recorded, and if Xu X 1 had borrowed RMB 511,000 on September 21, 2016, it must have been clearly recorded in the statement. A loan of $10,000 is recorded, but $511,000 is not recorded.

Case source: (2023) Hu 01 Min Zhong No. 9581

Lawyer Yang Qinren's comments,

First, Article 29 of the Supreme People's Court's Judicial Interpretation I on the Application of the Marriage and Family Section of the Civil Code of the People's Republic of China provides that if the parents contribute to the purchase of a house for both parties before they get married, the contribution shall be deemed to be a gift to their children, unless the parents expressly express that the gift is made to both parties.

After the parties get married, if the parents contribute to the purchase of a house for both parties, it shall be handled in accordance with the agreement; if there is no agreement or the agreement is not clear, it shall be handled in accordance with the principles provided for in Article 1062, Paragraph 1, Item 4 of the Civil Code.

Article 1062 of the Civil Code [Joint Property of Husband and Wife] The following property acquired by husband and wife during the existence of the marital relationship is the joint property of the husband and wife and shall be jointly owned by the husband and wife:

(1) Wages, bonuses, and remuneration for labor services;

(2) Income from production, operation and investment;

(3) the proceeds of intellectual property rights;

(4) Inherited or donated property, except as provided for in item 3 of Article 163 of this Law;

(5) Other property that shall be jointly owned.

Husband and wife have equal rights to dispose of joint property.

Article 1063: [Personal Property of Husband and Wife]The following property is the personal property of one of the spouses:

(1) One party's premarital property;

(2) Compensation or compensation received by one party for personal injury;

(3) Property that is determined in a will or gift contract to belong to only one party;

(4) Daily necessities for the exclusive use of one side;

(5) Other property that shall belong to one party.

In fact, the legal provisions are not clear as to whether the parents help the young couple to buy a house after marriage, and the house is registered in the names of both husband and wife, whether the contribution is a gift or a loan to the young couple. Because the expression of intention is often not so clear, the judge has the right to make inferences about the intention of the parties according to the actual situation.

Many parents think in their hearts that if the young couple has been living together, the money will be given, and if the younger couple divorces, then I have to get the money back.

Therefore, in reality, in many cases, those who understand the law are borrowed in the end, and those who do not understand the law do nothing without borrowing or giving away partially. Whether to borrow or give is mainly up to the judge's discretion.

For the determination of loans, the court usually gives the following reasons:

In today's context of high housing prices, some children have limited financial conditions, and it is normal for parents to provide financial assistance to their children when they buy a house, but this cannot be taken for granted, and it is definitely not advocated by law. When the child reaches adulthood, the parents have fulfilled their obligation to support the child and have no obligation to continue to support him.

Or

From the perspective of public order and good customs, while advocating respect for the elderly and caring for the young, we should also advocate that children should live independently once they reach adulthood. The financial assistance provided by parents to help their children improve their living conditions, tide over economic difficulties, and stabilize family harmony is not a legal obligation of parents, but a manifestation of the parents' mercy.

For the determination of gifts, the court usually gives the following reasons:

After the parties get married, if the parents contribute to the purchase of a house for both parties, the contribution shall be deemed to be a gift to both husband and wife, unless the parents expressly express that the gift is made to one of the parties;

Or

According to the relevant laws and regulations, if the parents contribute to the purchase of a house for both parties after they get married, the contribution shall be deemed to be a gift to both husband and wife. In this case, GM Lu's act of purchasing the house at issue after the marriage of Yang W and Xu J and registering it in the names of Yang W, Xu J and their legitimate sons should be deemed to be a gift to Yang W, Xu J and their legitimate sons.

The court of first instance held that

The focus of the dispute in this case is whether the loan relationship is established and whether Lu X 1 should bear the responsibility for repayment. The court held that whether the loan relationship is established should be examined from whether there is a loan agreement between the parties and the payment of the money. In order to prove the fact of the loan asserted by Xu X 1, he provided evidence such as the IOU, cash withdrawal, and transfer vouchers, and although the IOU was only signed by Xu X 2, the loan was used to purchase a marital house during the marriage relationship between Xu X 2 and Lu X 1, which was a joint debt of the husband and wife, so Xu X 2 and Lu X 1 were required to repay the loan. Looking at the loan in this case,

First of all, Lu X 1 did not recognize the loan, and before and after the loan, Xu X 1 and Xu X 2 did not mention to Xu X 1 that Xu X 1's financial support for his son was in the nature of a loan, and Xu X 1 confirmed that Lu X 1 was not present when the IOU involved in the case was issued, so it was difficult for the court to find that Lu X 1 was aware of it. Second, Lu X 1 argued that the money was a gift from Xu X 1 to Xu X 2 and Lu X 1, and if the parents contributed to the purchase of a house for both parties after the parties got married, the capital contribution should be recognized as a gift to both husband and wife, unless the parents expressly indicated that the gift was made to one party; Lu X 1 filed this lawsuit only after the divorce, which is contrary to common sense in terms of the loan relationship.

Thirdly, the IOU asserted by Xu X 1 was unilaterally signed by Xu X 2, and when the IOU was formed, Lu X 1 was not present, nor did he sign it afterwards for recognition; Lu X 1 had an agreement to jointly raise debts, and if it was determined to be a joint debt of the husband and wife, it would be obviously unfair to Lu X 1, so the court did not find that the money involved in the case was a joint debt of the husband and wife of Xu X 2 and Lu X 1. Fourth, according to the IOU presented by Xu X 1, the IOU was formed on September 21, 2016, and the statement written by Xu X 2 and Lu X 1 for the purchase of the house was formed on September 23, 2016, and the first half of the statement clearly recorded the borrowing situation, and even the RMB 240,000 from Xu X 2's mother, Lu X was clearly recorded, and if Xu X 2 had borrowed RMB 511,000 from Xu X 1 on September 21, 2016, it must have been clearly recorded in the statement. Even the loan of 10,000 yuan was clearly recorded and such a large loan of 511,000 yuan was not recorded, which was obviously contrary to common sense, which further confirmed that the loan was not a loan, but was included in Xu's capital contribution of 600,000 yuan. Fifth, in the down payment of the house involved in the case, Lu X 1 contributed RMB 124,000, and Xu X 2 contributed RMB 511,000 of the 600,000 yuan contributed by Xu X 2 as a loan, then Xu X 2 actually contributed more than RMB 90,000, but the real estate rights holder was registered as Lu X 1, Xu X 2 and Xu X 2, the child of Xu X 2 and his ex-wife Xu X 3, considering that Xu X 2, Lu X 1 is a remarried couple, and the real estate registration includes Xu X 3, from the general social common sense analysis, the capital contribution is reflected in the registration of the real estate rights holder to a certain extent, and it is also contrary to common sense to register Xu X 2's father and daughter when Xu X 2's father Xu X 1 raised a large amount of debt. Now Xu X 2 recognizes all the loans and confirms that the IOU is his signature, so the loan in this case should be recognized as Xu X 2's personal debt, and the legal effect of his unilateral expression of intent should not extend to Lu X 1.

The court of second instance held that

Xu X 1 claims the return of the loan to Xu X 2 and Lu X 1 by virtue of the IOU, and shall bear the burden of proof for the constitutive elements of the private lending relationship - payment delivery and loan agreement. The court of first instance discussed the formation of the IOU, the relationship with the statement, the proportion of housing contribution, and the registration of property rights, and other aspects, and that Lu X 1 did not jointly raise debts with Xu X 2, and the reasons were detailed and logically reasonable, and this court agreed. Because the money involved in the case occurred between parents and children, and Xu X 1 did not demand the money involved in the case until after the divorce proceedings of Xu X 2 and Lu X 1, the judgment of the loan agreement should be given a higher evidentiary force. Although the money involved in the case was used for Xu X 2 and Lu X 1 to jointly purchase a house after marriage, it was a large amount of living expenses beyond the scope of the family's daily life, and now Lu X 1 denied the loan, saying that he did not know that Xu X 2's house purchase capital was borrowed from Xu X 1, and neither Xu X 1 nor Xu X 2 provided further evidence to prove that Lu X 1 was aware of the loan, so it is difficult to reflect the agreement of the husband and wife to jointly raise debts, and this court cannot determine that the loan is a joint debt of the husband and wife. In summary, the appellants' appeal claims cannot be sustained and should be dismissed, and the first-instance judgment should be upheld because the facts found are clear and the law is correctly applied.

Case sharing 1, if parents contribute to the purchase of a house for their children after marriage, is it considered a gift or a loan?
Case sharing 1, if parents contribute to the purchase of a house for their children after marriage, is it considered a gift or a loan?

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