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Saturday, June 13, 2009

Husband and wife successfully sue former mistress for return of 300,000 yuan in gifts

Here's an interesting story: after a man broke up with his mistress, he and his wife successfully sued her for the return of 300,000 yuan, representing the value of gifts he had given her over the years they were together.

Dan Harris, from whose excellent China Law Blog I got this story [English | Chinese], comments that it's a good example of how Chinese courts tend to weigh the perceived equities very heavily in their rulings, as opposed to what the law might strictly require. I don't disagree with this as a general proposition, but would note only that the wife's case seems far from meritless. China has a community property system for married couples, and the wife argued that the husband could not therefore validly alienate these gifts without her consent. As the mistress pointed out in her defense, of course, the entire economic system would break down if any transaction by a spouse could be invalidated later by the other spouse at will.

Here's the legal basis for the two arguments:

Mistress: The Marriage Law (Art. 17) says that "Husband and wife have equal rights of disposition over community-owned property" (夫妻对共同所有的财产,有平等的处理权。) In other words, either party can dispose of community property on their own.

Wife: Art. 17 of the Supreme People's Court's Interpretation of Several Issues in the Application of the Marriage Law (关于适用《中华人民共和国婚姻法》若干问题的解释) indeed states that "[e]ither party has the right to decide on a disposition of community property where it is for daily living necessities" (i.e., a concept of ordinary expenses) (因日常生活需要而处理夫妻共同财产的,任何一方均有权决定。 ). But where important dispositions for non-ordinary expenses are involved, both spouses must agree (夫或妻非因日常生活需要对夫妻共同财产做重要处理决定,夫妻双方应当平等协商,取得一致意见。)

Mistress: At least according to the news report, the mistress responded that Art. 17 of the SPC Interpretation also says that "[w]here the third party has reason to believe, the other spouse may not oppose the disposition to a bona fide third party on the grounds that he or she did not know or did not consent." Unfortunately, the mistress did not quote the provision in full. It actually says, "Where the third party has reason to believe that [the disposition] is a manifestation of the joint agreement of the husband and wife, the other spouse may not oppose the disposition to a bona fide third party on the grounds that he or she did not know or did not consent." (他人有理由相信其为夫妻双方共同意思表示的,另一方不得以不同意或不知道为由对抗善意第三人。 )

In short, if you accept just two premises - (1) that gifts to a mistress are not a necessity for daily living, and (2) that a mistress could not reasonably believe that a wife would consent to the gifts being made to her - then the wife's case actually looks pretty good. Thus, it might be a mistake to see this case as an example of a court overriding the law to get at the equities.

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Comments

According to Chinese law, what items are considered necessities for daily living? It seems reasonable that buying gifts for a mistress is not a necessity.

It does seem reasonable that a mistress could possibly reasonably believe that a wife would consent to the gifts. Personally, I know of two couples where this situation occurs.

Posted by: mitchell | Jun 15, 2009 10:42:11 AM

Interestingly, similar suits were not only banned in Colorado in the late 19th century, but remain the only kind of suit which it actually constitutes a crime to file in the state. Colorado's example was a bit extreme, but the legal rule in some form or another was adopted in most states. One reason for the different approach in the U.S. may have been that the right to a remedy from the mistress was posed as a question of reputational and intangible harm, rather than one of property rights.

Posted by: ohwilleke | Jun 15, 2009 2:12:57 PM

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