How can the innocent party recover the property donated by one spouse to a third party?
Adultery, bigamy, and maintaining a mistress are classic triggers in divorce cases. When a third party is involved, one spouse, in order to sustain an illicit relationship, often transfers marital property to the third party. The innocent spouse typically only becomes aware of such transfers after a substantial portion of the marital assets has already been diverted, giving rise to numerous lawsuits in which the innocent spouse seeks to recover the transferred marital property from the third party.
Recently, I also handled a case of this type. As the attorney representing the non‑faulting party as the plaintiff, I assisted my client in filing a lawsuit after the divorce on the grounds of a dispute over a gift contract, seeking to hold both the faulting party and the third party jointly liable for returning the gifted funds (which constitute marital property). After extensively gathering evidence, presenting evidence, and engaging in cross‑examination, the court ultimately adopted the defense and advocacy positions advanced by my legal team, ruling that the third party must return the entire amount of the gifted funds to the non‑faulting party.
In judicial practice, how are gift payments determined? Can the party without fault request the third party to return the gifted funds, and if so, should the full amount or only half be returned? How do third parties typically defend themselves? Drawing on the key points of contention in specific cases and the perspectives of judicial rulings, this article analyzes these issues, reviews and summarizes practical experience, and presents the findings for the benefit of readers.
1.
What is the legal effect of a gift contract? How does judicial practice determine whether a payment constitutes a gift?
1
A gift contract that violates public order and good morals is void.
According to Article 153, paragraph 2, of the Civil Code: A civil legal act that violates public order and good morals is void. During the subsistence of the marriage, if one spouse maintains a long-term improper relationship with a third party and gifts marital joint property to that third party—such as purchasing real estate, luxury goods, or covering living expenses for the third party—this constitutes such an act.
Such a gift violates the marital duty of fidelity, contravenes social morality, and runs counter to public order and good morals, thus constituting an invalid civil legal act.
2
An act by one spouse to unilaterally dispose of marital property without being necessitated by the ordinary needs of family life is invalid.
In the absence of an agreement to adopt a system of separate property during the marriage, any property acquired by the spouses during the marriage shall be jointly owned by both. The spouses enjoy joint ownership of such property without specifying shares, and each party has equal rights to manage it. When one spouse intends to make a significant disposition of marital property that is not necessary for the ordinary needs of family life, both parties must consult with each other on an equal basis and reach a consensus; neither party may unilaterally dispose of the marital property.
3
How is it determined whether property accepted by a third party constitutes a gift?
First, when one spouse in a marriage engages in an illicit relationship with a third party—whether short-term or long-term, including cohabitation or even having a child out of wedlock—the property received by the third party is generally considered a gift, often described as “lavishly spending money to win the affection of a lover.” Second, the gift of property to a third party was made during the subsistence of the marital relationship.
Only property acquired by the spouses during the subsistence of the marriage shall be considered marital property. If one spouse commits adultery and, without authorization, disposes of the couple’s joint property by gifting it to a third party. Third, the other spouse was unaware of and did not consent to the gift to the third party, nor did they subsequently ratify it through any express or implied conduct.
Fourth, if a third party knowingly accepts a gift from a person who is already married without providing any consideration, even if the third party was unaware of the marital status, the gratuitous nature of the gift and its violation of public order and good morals preclude the application of the doctrine of bona fide acquisition. Fifth, the timing of transfers made by the at-fault party to the third party is entirely irregular, and the amounts are also inconsistent; moreover, some transfer amounts include numerals with special significance, such as 5
20or 1314.
Sixth, the third party has no independent source of income, or their standard of living significantly exceeds their income level.
2.
Can the original spouse request that the third party return the entire gift amount, or only half of it?
The first scenario: The property is discovered and recovered through litigation before the divorce has been finalized. In judicial practice, this situation generally does not give rise to controversy. Based on the joint ownership of marital property, if the husband disposes of such property without the consent of his spouse and gifts it to a third party, such act violates public order and good morals and constitutes an invalid civil legal act; the third party is therefore obligated to return the entire gift.
The second scenario: the property is discovered and a lawsuit is filed to recover it only after the divorce. Such cases are subject to controversy in judicial practice.
Viewpoint one: The third party should return the entire amount of the gift to the original spouse. Marital property is subject to the principle of joint ownership rather than tenancy in common. Any unilateral disposition of such property by one spouse that is not for the ordinary needs of family life infringes upon the other spouse’s property rights, and the entire gift should therefore be deemed invalid.
Gifts made to a third party are typically conducted in secrecy, resulting in the gifted funds not being subject to division during divorce proceedings. When one spouse transfers marital property to a third party, it is tantamount to that spouse relinquishing their ownership interest; therefore, the full amount of the gift should be returned to the innocent spouse. Furthermore, where one party in a marital relationship commits adultery, enters into a subsequent marriage, and bears an illegitimate child—constituting a serious breach of marital duty and causing substantial harm to the other spouse’s rights to jointly owned property—such party should receive no share of the marital assets upon divorce, in accordance with the provisions of the Civil Code.
Viewpoint two: The third party should return half of the funds to the original spouse. During the subsistence of the marriage, the joint property of the spouses constitutes an indivisible whole and is held in co-ownership. However, once the marital relationship is dissolved, the parties are deemed to hold the property as tenants in common; the original spouse has rights only with respect to their own share of the property. Accordingly, only the portion of the gift exceeding the wrongdoer’s power of disposition is deemed invalid, and the third party is required to return half of the gifted amount to the original spouse.
3.
Common defenses raised by third parties
1. The third party often pretends to be clueless, claiming they were unaware of the man’s true marital status and that they were deceived and used as a third party. As previously analyzed, even if one was genuinely unaware, this still does not satisfy the requirements for bona fide acquisition; what must be returned must still be returned! A third party may also argue that the two parties are merely friends and have not been engaged in a long-term, improper extramarital affair. However, such defenses do not affect the determination of the nature of the gifted funds.
2. The third party argues that it did not accept the gift, and that the real estate and other gifted assets under its name were purchased by itself, rather than being gifts from the party at fault. At this stage, the focus should be on verifying the third party’s income and consumption level to determine their purchasing capacity, as well as examining the timing of the purchase, payment arrangements, and the registered rights holder.
3. The most common defense is that a third party argues the relationship constitutes a private loan rather than a gift contract. In particular, when a third party maintains a long-term illicit relationship with the faulting spouse and the two parties frequently engage in monetary transactions, the third party may seize portions of bank transaction records as evidence, even claiming that the funds have already been repaid.
However, in accordance with the legal provisions governing loan relationships, a third party asserting the existence of such a relationship must provide evidence to substantiate its claim, including presenting the promissory note and corresponding bank transfer records that match the terms of the note. The court will also examine factors such as the time of the loan, the loan amount, the purpose of the loan, the third party’s occupation and income level, and whether the third party has the ability to repay the loan.
A third party must provide conclusive evidence that the gifted funds in question constitute a loan; otherwise, its defense based on a lending relationship is unlikely to be upheld by the court.
4. If a third party has an illegitimate child, they may argue that the gifted funds constitute alimony paid by the faulting spouse to the non-marital child, or claim that the gifted funds should be set off against such alimony. Such defenses have given rise to differing views in judicial practice. Under what circumstances will this claim be upheld by the courts?
First, the recipient of child support is a minor or a child who is unable to support themselves. Child support covers expenses such as living costs, medical expenses, education fees, and training costs. Secondly, the payment of child support should adhere to the following standards: first, the financial capacity of the parents, taking into account their occupation and actual income level; second, the local standard of living, including the per capita consumer expenditure of residents in the area; third, the child’s actual needs, such as education and medical expenses, ensuring that the amount of child support is commensurate with the child’s age‑appropriate expenditures; and fourth, whether the party at fault has entered into a child‑support agreement with the third party.
In summary, if the funds paid by the party at fault to the third party meet the aforementioned standards for child support, then, in accordance with relevant regulations, non-marital children shall enjoy the same rights as marital children. Parents or persons with a legal duty to provide support shall bear the expenses for such support; this is a statutory obligation. Child support pertains to the right of minors to subsistence and constitutes a significant personal interest, thus enjoying a higher level of legal protection than ordinary economic interests.
Therefore, in order to avoid prolonged litigation, and in accordance with the principle of safeguarding the legitimate rights and interests of minors under the law, courts generally address such issues concurrently in disputes over gift contracts. A third party claiming that the gifted funds constitute child support must provide conclusive evidence and demonstrate unequivocally that the funds are intended as child support rather than for any other purpose in order for their claim to be upheld by the court.
4.
How can the non-faulting party overcome the defense raised by a third party regarding child support?
In the case I handled, the party at fault argued that the gifted funds constituted child support. Drawing on the litigation strategy and relevant judicial precedents, my client’s counsel provided a viable path forward for the non‑faulty party.
At the time of filing the lawsuit, the party not at fault should assert the return of the entire gift amount. In accordance with the principle that the court will not adjudicate unless a claim is made, if no such claim is raised in the initial complaint, the court will not proactively order the full return of the gifted funds; the amount to be returned shall be determined based on the plaintiff’s claims.
Child support refers to the payments that parents or other persons with a legal obligation to provide support are required to make. The issue of raising a child born out of wedlock is unrelated to the party who is not at fault, and claims for child support should not be made in a manner that infringes upon the property rights of the non-faulting party. The other spouse has no obligation to provide support for a child born out of wedlock to a third party.
Disputes over gift contracts and disputes over child support involve distinct legal relationships, and the parties’ procedural status in each case differs; therefore, the prevailing view holds that they should not be consolidated for trial in a single proceeding. Disputes over child support may be pursued through separate judicial remedies.
In the cases I have handled, where the husband purchased a property for a third party—sometimes even paying in full—and made large transfers or bought luxury goods exceeding the child’s actual needs, such expenditures cannot be deemed to constitute child support.
Even if the gifted funds are deemed to constitute child support, it must still be determined whether the amount of child support exceeds the local standard of living. Child support should be commensurate with the child’s age and paid in accordance with the child’s actual needs; moreover, a higher income on the part of the father does not necessarily mean that he is obligated to pay an excessively high amount of child support.
Child support is an obligation of both parents, and the third party also has a duty to contribute to the child’s upbringing. Child support should not be borne solely by the at-fault parent; rather, the at-fault parent and the third party should share the costs equally, thereby seeking a reduction in the amount of child support that can be deducted.
From the perspectives of legal principles, equity, and the cooperative evidentiary conduct of the parties in litigation, we respectfully request the court to take note that gift-giving may also serve as a means by one spouse to conceal or transfer marital property. In disputes over gift contracts, the legitimate rights and interests of the non‑faulting party should be protected, and social fairness as well as public order and good morals should be upheld; meanwhile, the protection of minors’ rights and interests may be pursued through other legal avenues.
Finally, the lawyer advises that, before any issues arise in a marriage, spouses tend to trust each other implicitly; however, it is often only at the time of divorce that they discover assets have been transferred, which significantly complicates the process of recovering those assets. One spouse can make advance arrangements regarding their assets and should regularly monitor the other spouse’s bank accounts, paying particular attention to those held at smaller regional banks. When the other spouse proposes transferring property or equity interests to relatives or third parties without compensation, proceed with caution, and remain vigilant for subtle clues in everyday life, such as receipts and loan records.
Of course, marriage is not easy—so cherish it as you go along. May everyone encounter kind and worthy partners, and may every experience be peaceful and fulfilling!
Author Introduction
Attorney Zhang Ping
Senior Equity Partner at
With 16 years of legal practice, holds a Master’s degree in Litigation Law from China University of Political Science and Law and a Bachelor’s degree in Law from Beijing Institute of Technology. Also a National Level-2 Psychological Counselor and a licensed cultural performance agent. Specializes in various civil and commercial contract disputes, equity-related dispute resolution, live-streaming brokerage, film and entertainment law, and corporate legal advisory services.
Wu Xiaomin
Intern lawyer at
Graduated from Guangdong Ocean University with a degree in International Economics and Trade. Previously served as a Human Resources Manager at a U.S.-listed company for many years, handling numerous labor contract disputes. Currently, I provide legal services in the areas of equity disputes, matrimonial and family law matters, and entertainment law within Attorney Zhang Ping’s team.
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