In order to achieve tax avoidance and other purposes
Some of the parties conspired to commit fraud
"In the name of buying and selling, it is actually a gift".
But who would have thought
The donor of the house actually held the "sales contract"
Require the donee to pay the price
The parties would have wanted to reduce the hassle of the transfer
On the contrary, it brought more "trouble"
……
The picture comes from the Internet
In order to avoid the tax cost of the transaction, Mrs. Wu and her granddaughter Ms. Xie signed a house sale contract that was "called a sale, but in fact a gift", but after the transfer, Mrs. Wu took the contract and filed a lawsuit with the people's court to demand that Ms. Xie pay the corresponding price. Will the people's court support this appeal?
Recently, the Shanghai Hongkou District People's Court (hereinafter referred to as the Hongkou District People's Court) concluded such a case of a dispute over a housing sales contract.
Case review
Mrs. Wu and Ms. Xie are grandparents. Mrs. Wu, who is nearly 90 years old, has a commercial house in Hongkou District, Shanghai (hereinafter referred to as the "Housing at Issue") under her name, and her wife has passed away for many years, and her two sons are not working and living in the city, and Mrs. Wu has lived alone in the house for a long time. Worried that Mrs. Wu would have difficulty living alone, her granddaughter, Ms. Xie, often went to Mrs. Wu's home to take care of her daily life.
In February 2023, Mrs. Wu and Ms. Xie signed the Shanghai Real Estate Sale and Purchase Contract. The contract stipulated that Mrs. Wu would transfer the property at issue to Ms. Xie at a transfer price of RMB 1.8 million. After signing the contract, Mrs. Wu and Ms. Xie went through the registration of the change of real estate rights.
In December 2023, Mrs. Wu sued Ms. Xie to the Hongkou District People's Court, demanding that Ms. Xie pay the corresponding house transfer price. During the trial, the people's court added Mrs. Wu's son, Ms. Xie's uncle, Mr. Xie, as the third party in the case.
The picture comes from the Internet
The defendant, Ms. Xie, argued that, first, although the two signed the Shanghai Real Estate Sales Contract, the real meaning of the two parties was that Mrs. Wu donated the house to herself. In the house sale and purchase contract, there was no agreement on the corresponding time and method of payment, and after signing the contract and completing the transfer procedures, Mrs. Wu did not claim any house price from herself. Second, the third person, Mr. Xie, also reached an oral agreement with himself, in which the two parties agreed that Ms. Xie would be responsible for supporting Mrs. Wu and agreed that Mrs. Wu would donate the house to Ms. Xie. Mr. Xie also signed a Letter of Undertaking indicating that he would renounce his right to inherit the property at issue. Therefore, the people's court was requested to reject the plaintiff's claim.
The third person, Mr. Xie, stated that although Mrs. Wu, Ms. Xie and himself had mentioned the handling of the housing at issue, they had not reached any agreement. The Letter of Undertaking signed by himself to "renounce the inheritance of the house at issue" has nothing to do with this case.
People's court adjudication
After trial, the Hongkou District People's Court held that the focus of the dispute in this case was whether the original defendant signed the house sale contract as a real meaning of the house sale or a house gift.
As for how to determine that the "act of buying and selling a house" is actually an "act of giving away a house". In this case, although the parties had signed the Shanghai Real Estate Sale and Purchase Contract and completed the transfer procedures, the contract did not stipulate the key terms such as the payment of the house price, the time of delivery of the house, and the liability for breach of contract. In addition, without receiving any payment for the house, Mrs. Wu transferred the house to Ms. Xie, which was not in line with the common sense of the transaction. Based on the kinship between the parties, the actual use of the house, the Letter of Commitment issued by Mrs. Wu's children to renounce the inheritance of the house, and Ms. Xie's self-statement that she promised to assume the responsibility of supporting Mrs. Wu (including the retirement of the elderly), the people's court held that Mrs. Wu's true intention was to donate the house at issue to Ms. Xie, and considering that Ms. Xie claimed that the purpose of Mrs. Wu's house donation was to be supported by herself, the gift could be determined to be a gift with obligations.
Since the gift did not cause damage to Mrs. Wu's rights and interests, and Ms. Xie repeatedly promised to fulfill her maintenance obligations during the litigation, the people's court finally rejected the plaintiff's claim.
After the judgment, none of the parties appealed, and the judgment is now in force.
What the judge said
Lai Yixuan
Hongkou District People's Court
Civil Division
Second-level judges
In recent years, it has become common for parents and children and grandparents and grandchildren to carry out housing transactions. Many of the house sales between relatives are not real sales, but for the purpose of circumventing national policies and reducing transaction costs.
When dealing with disputes over the sale and purchase of houses, the people's courts should not only pay attention to the superficial form of transactions, but also deeply restore the true intentions behind the parties.
1. Correctly identify behaviors that are "called to buy and sell" and "actually to be gifts".
How to identify the true intention of the parties, in judicial practice, because it is difficult for the donee to produce written evidence that the house was donated, it brings certain challenges to the judge to correctly identify the behavior of "purported sale" and "actual gift". If the people's courts fail to do a good job of explaining the law and reasoning in the case trial and judgment documents, it is very likely to intensify the conflict and affect the effectiveness of the case. However, if the behavior of "buying and selling, but actually gifting" is not recognized, it will objectively condone the act of collusion to falsify and circumvent national policies, resulting in bad value orientation.
Accordingly, the Shanghai court has developed an application scenario that applies "it is called a sale, but it is actually a gift" (click to view details) to assist judges in judging risks and determining points to stop disputes. This case applied this application scenario and assisted the undertaking judge in correctly identifying the true expression of intent of the parties' house donation.
2. "Conspiracy to commit hypocrisy" is invalid and is to be tried as "true concealment".
"Conspiracy to commit hypocritical conduct" is manifested in the fact that the actor has an expression of intent, the external conduct is inconsistent with the inner true intention, and the counterpart clearly knows that the actor's external conduct is inconsistent with the inner true intention. The conspiracy and hypocrisy made by the parties is invalid, and the effectiveness of the hidden civil juristic acts is to be handled in accordance with the relevant legal provisions. In this case, the contract for the sale and purchase of the house at issue was a false expression of intent, and the contract should be invalid, while the concealment should be an act of gift and should be valid.
3. "Housing for the elderly" is a gift with obligations
During the trial, Ms. Xie admitted that Mrs. Wu donated the house to her because she promised to support Mrs. Wu, and during the trial of this case, she also promised many times that she would fulfill her obligations according to the agreement and provide Mrs. Wu with her old age, and was willing to provide the house to Mrs. Wu to live in for a hundred years.
From the perspective of protecting the interests of the elderly, the act of donation did not cause damage to Mrs. Wu's interests. Therefore, the gift in this case can be determined to be a gift with obligations, and the attached obligation is that Ms. Xie should perform the maintenance obligation to Mrs. Wu in accordance with the agreement, and the donee Ms. Xie should perform the maintenance obligation in accordance with the agreement and ensure Mrs. Wu's residential rights and interests in the house at issue.
The picture comes from the Internet
Fourth, "housing for the elderly" needs to protect the rights and interests of the elderly
Housing is an important guarantee for the elderly to provide for the elderly, so that the elderly have something to rely on and live in, which is the embodiment of the traditional virtues of the Chinese nation of respecting, loving and helping the elderly. Ensuring that the legitimate rights and interests of the elderly are not infringed upon is the common responsibility of the whole society, and it is also the embodiment of practicing the core socialist values in judicial practice.
In reality, if the elderly sign a gift agreement of "housing for the elderly", they should also sign a written "housing for the elderly" agreement to make it clear that the gift is a gift with obligations and effectively protect their rights and interests. The "housing for the elderly" agreement should include the burden of the elderly's maintenance obligations, the residents' right of residence after the transfer of the house, and the consequences of not fulfilling the maintenance obligations of the agreement, and register the housing management department's right of residence, with a neutral third party such as the neighborhood committee or the street witnessing and signing in the process. Once the donee violates the provisions of the agreement, the elderly can take back the house and revoke the gift based on the obligation gift agreement.
Links to legal provisions
Civil Code of the People's Republic of China
Article 146:Civil juristic acts carried out by the actor and the counterpart with false expressions of intent are invalid.
The effectiveness of civil juristic acts concealed by false expressions of intent is to be handled in accordance with the relevant legal provisions.
Article 657:A gift contract is a contract in which the donor gives his property to the donee free of charge, and the donee expresses his acceptance of the gift.
Article 661: Gifts may be accompanied by obligations.
Where the gift is accompanied by obligations, the donee shall perform the obligations in accordance with the agreement.
Source丨Shanghai Hongkou District People's Court