Today, the Supreme People's Court issued the "Interpretation (II) of the Marriage and Family Chapter of the Civil Code," addressing widely watched hot-button issues since the implementation of the Civil Code and new situations encountered in the adjudication practice of marriage and family disputes, as well as contentious issues that urgently need resolution. It further standardizes several key areas of concern to the public, including the attribution of parents' financial contributions toward the purchase of housing for their children after marriage, the determination of property gifts between spouses based on marriage, the invalidation of gifts of marital property in violation of spousal fidelity obligations, the abduction or concealment of minor children, property division during cohabitation, and malicious debt evasion through divorce. This interpretation aims to unify legal application and adjudication rules to resolve disputes. Reporters interviewed relevant officials from the Supreme People's Court for an in-depth explanation of the new provisions in the judicial interpretation.

When parents contribute financially to the purchase of a home for their children,

how is the property divided if the children divorce?

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In China, it is quite common for parents to financially contribute towards the purchase of a home for their children when they get married. This practice not only serves as a means of intergenerational wealth transfer but also symbolizes the parents' blessing and material support for their children's marital happiness. However, when the children divorce and divide the jointly owned marital property, the issue of ownership of the property purchased with parental financial assistance often becomes a point of contention between the parties. The Supreme People's Court has issued judicial interpretations under the Civil Code concerning the Marriage and Family Chapter to address these matters.

According to the provisions of the Civil Code, property received as gifts during the marriage is considered jointly owned by the spouses unless the gift contract specifies that it belongs solely to one party. When divorcing, both parties may agree on how to divide the jointly owned property; if no agreement can be reached, the People's Court will make a ruling based on the specifics of the property situation.

Judge Wang Dan from the First Civil Division of the Supreme People's Court explains: "When we talk about the specific circumstances of the property, we consider the source of funding as part of those circumstances. In dividing jointly owned marital property upon divorce, normally each spouse would receive half, but if the source of funds came predominantly from one spouse or one set of parents, this fact must be taken into account, potentially resulting in an unequal division."

The judicial interpretation distinguishes two scenarios: full funding by one parent and partial funding by either both sets of parents or just one set, addressing each accordingly.

Scenario One: Full funding by one parent. If the gift contract stipulates that the gift is intended solely for their own child, then it should be handled according to that stipulation. If there is no stipulation or if the stipulation is unclear, regardless of whether the house is registered in the name of the child who received the funding, the court can rule that the house belongs to the funded child, thereby protecting the interests of the contributing parent(s). However, the court will also take into account factors such as cohabitation, the presence of children, and any fault in the divorce to determine if compensation should be provided to the other party and the amount thereof.

For example, suppose Xiao Ming and Xiao Hong got married, and Xiao Ming's parents fully funded the purchase of a house for them without specifying that it belonged only to Xiao Ming. After living together for five years, they divorced. According to the latest judicial interpretation, after Xiao Ming and Xiao Hong divorce, the court would consider the funding contribution from Xiao Ming's parents and likely award the house to Xiao Ming. At the same time, the court would also consider Xiao Hong's contributions during the marriage, such as the duration of cohabitation, the existence of children, and any fault in the divorce, to decide on reasonable compensation for Xiao Hong.

Scenario Two: Both sets of parents have contributed to the purchase of the house or one set of parents has partially funded it. Due to the varying sources and proportions of contributions in different cases, it is difficult to clearly attribute ownership to one party, requiring case-by-case handling.

Chief Judge Chen Yifang of the First Civil Division of the Supreme People's Court provides an example: If one set of parents contributes 20% and the other set contributes 80%, in principle, the house would be awarded to the party whose parents contributed 80%. However, the compensation given to the other party might not necessarily be 20%; it would depend on factors such as the state of the marriage, cohabitation, the presence of children, and any fault in the divorce. According to the Civil Code, compensation should be determined while considering the principles of protecting children, women, and the innocent party. This amount could be less than or more than 20%, depending on the complexity of real-life situations. Judges need to thoroughly investigate the facts of each case and make a fair and reasonable judgment.

Judges emphasize that in determining the attribution of properties purchased with parental funding, the judicial interpretation aims to protect individual property rights while maintaining harmony and stability within marriage and family life.

Judge Wang Dan of the First Civil Division of the Supreme People's Court adds: "In principle, if one set of parents fully funds the purchase, the interest of the contributors is protected. However, we must also recognize the value of the contributions made by the spouse who has invested in the marriage and family, guiding society away from focusing on adding names to property deeds or registrations, which could sow seeds of discord in marriages. Should the marriage not last, the courts will consider all contributions and investments comprehensively to balance the interests of both parties, encouraging greater attention to family investment and enhancing family cohesion and unity."

Property acquired during the period of cohabitation without marriage

How is it divided between the parties?

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In recent years, property disputes arising from cohabitation have gradually increased, becoming a focal issue of societal concern. Although cohabitation relationships are not legally protected, the property rights of cohabiting parties should still be safeguarded by law. Therefore, there is a need for clear legal rules to regulate the distribution of property acquired during cohabitation. This judicial interpretation addresses the division of property in cohabitation relationships.

According to Chinese law, only couples who have registered their marriage and thus established a marital relationship enjoy the rights and obligations between spouses. Cohabitation differs from marriage in that cohabiting partners do not possess the rights and obligations of married couples and are not subject to the statutory regime of joint marital property. So, what rules apply to the distribution of property obtained during cohabitation?

Chief Judge Chen Yifang of the First Civil Division of the Supreme People's Court states: "Firstly, we respect the principle of party autonomy. If the parties have an agreement, it will be handled according to the agreement. In the absence of an agreement, the principle 'one's property belongs to oneself' applies; for example, if both parties earn salaries, each person's salary remains their own."

However, during the course of cohabitation, situations may arise where both parties jointly contribute to the acquisition of assets or engage in joint business investments, making it difficult to clearly distinguish the properties. In such cases, how does the court divide the property?

The judicial interpretation stipulates that the primary consideration is the proportion of contributions, while also taking into account factors such as the circumstances of cohabitation, whether there are any children, and the extent of each party's contribution to the property.

Chief Judge Chen Yifang of the First Civil Division further explains:

1. The situation of shared living, including the duration of cohabitation and the contributions made by each party.

2. Consideration of whether there are children, involving child custody and future support expenses.

3. Evaluation of the contributions made during the period of joint investment, for instance, if one party primarily managed a jointly funded business, this would be considered when dividing the property.

In summary, based on the specifics of individual cases, these factors must be comprehensively considered to appropriately handle the interests of both parties.

For example, Xiao Ming and Xiao Hong cohabited and jointly invested in opening a store, with Xiao Ming contributing 70% and Xiao Hong 30%. When dividing the property, the contribution ratio will be considered first. However, if the operation of the store was mainly overseen by Xiao Hong, leading to its appreciation, the court might reasonably increase Xiao Hong's share to reflect her contribution to the property's value growth.

Therefore, it is advisable for individuals in cohabitation to reach a clear written agreement on property distribution beforehand to prevent potential disputes.

Strict Regulation of

the Abduction and Concealment of Minor Children

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In practice, during the period of separation or divorce litigation, as well as after divorce, some parents may resort to extreme measures to prevent the other party from visiting the child, even going so far as to abduct or conceal the child. In response to such behavior, the judicial interpretation has addressed this issue.

The Supreme People's Court stated that the abduction and concealment of minor children not only infringe upon the other parent's lawful rights to raise, educate, and protect their children but also, more importantly, can seriously harm the physical and mental health of the minor children. Such actions should be firmly prevented and stopped. The judicial interpretation regulates this behavior accordingly.

Judge Wang Dan of the First Civil Division of the Supreme People's Court explained:

Firstly, there is a swift halt to unlawful behavior through the issuance of personal safety protection orders or behavioral restraining orders to quickly restore the child to their original living conditions.

Secondly, in cases where one party does not yet wish for a divorce, in disputes over guardianship, the court can rule to temporarily determine the matters concerning the custody of the minor children.

Thirdly, when determining which party should have direct custody of the minor children during divorce litigation, we consider the abduction or concealment of minor children as an adverse factor against the perpetrator, giving priority consideration to custody by the other party.

In judicial proceedings, judges typically conduct comprehensive investigations into various circumstances through family surveys, psychological evaluations, visits, and other means. They then make judgments on who should have direct custody of the minor children based on the principle of what is most beneficial for the minor children, taking into account all relevant factors.

Agreements in a divorce settlement to transfer property to children

cannot be casually revoked.

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In divorce disputes, when the couple cannot agree on the division of substantial joint property, especially the only real estate, a common compromise is to award the property to their mutual children. Sometimes, one party agrees to the divorce precisely because the other party consents to giving the joint property to the children. However, after the divorce, there are instances where one party refuses to comply with the agreement. The judicial interpretation has provided clear regulations on this matter.

The judicial interpretation specifies that if a divorce agreement stipulates granting part or all of the marital joint property to the children, and after the divorce, one party requests to revoke this agreement before the transfer of property rights, the People's Court will not support such a request. This means that once the divorce agreement takes effect, any property designated for the children must be honored by both parties.

For example, upon divorcing, Xiao Ming and Xiao Hong agreed to give their jointly owned house to their child. After the divorce, if Xiao Ming changes his mind and wants to revoke this agreement, the court will not support Xiao Ming's request.

Judge Wang Dan from the First Civil Division of the Supreme People's Court explained: According to the rules of gift contracts, before the transfer of property rights, the donor has the right to revoke the gift at will. However, since this is not a simple gift but rather a specific form of dividing joint marital property between spouses, it cannot be revoked arbitrarily.

The judicial interpretation also stipulates that if one party breaches the contract, the other party can request them to continue performance or seek compensation for losses due to non-performance as civil liabilities.

Judge Wang Dan further explained: For instance, if one party sells the house, making it impossible to fulfill the original agreement regarding the property, the civil liability can then be replaced with compensation for loss.

Additionally, in practice, there have been cases where after transferring property to the children, one party discovers that the children are not biologically theirs. In such cases, the interpretation clarifies that if one party has evidence proving that there was fraud or coercion when signing the divorce agreement, they can request to revoke the agreement and redivide the related marital joint property.

Regulating the Practice of "Divorce to Evade Debts"

Protecting the Legitimate Rights and Interests of Creditors

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In practice, some couples incur debts in one party's name and then transfer assets through divorce to evade these debts, causing significant trouble for creditors. To effectively regulate such behavior and protect the legitimate rights and interests of creditors, the judicial interpretation clearly states that creditors can request the annulment of relevant property disposition clauses in a divorce agreement.

For instance, during their marriage, Xiao Ming borrowed 500,000 yuan from Xiao Wang under his own name. To evade this debt, Xiao Ming and Xiao Hong agreed to divorce and transferred all family assets to Xiao Hong's name, preventing Xiao Wang from collecting on his claim.

In response to such occurrences, the judicial interpretation clarifies that if a couple maliciously escapes debt through divorce, creditors can petition for the annulment of related property disposition clauses in the divorce agreement.

This means that Xiao Wang can apply to the court to revoke the clause concerning asset transfers in Xiao Ming and Xiao Hong's divorce agreement to safeguard his creditor rights.

Chief Judge Chen Yifang of the First Civil Division of the Supreme People's Court explained: "When one spouse has incurred external debts, some couples negotiate to transfer property to the non-debtor spouse, essentially using this 'escape' method to avoid debt. If creditors have evidence proving that the debt evasion occurred through a divorce agreement, they can exercise the right of revocation as stipulated by the Civil Code, requesting the annulment of the property disposition clauses in the divorce agreement to protect their legal rights."

Furthermore, the judge noted that it is important to clarify that the division of property in a divorce agreement often takes into account factors such as which party will directly raise any minor children and whether there was fault on one party's part, so it does not necessarily result in an equal split. Therefore, one cannot simply use unequal property distribution as grounds for claiming that creditors' interests are harmed and seek to revoke the divorce agreement. The special nature of marriage and family must be considered, with strict standards applied for annulment.

Chief Judge Chen Yifang added: "When determining whether to support a creditor's right of revocation, consideration must also be given to the circumstances of both parties' divorce, including any faults, the division of joint property, the execution of the agreement, and the burden of child custody. While protecting the interests of creditors, we must also ensure not to infringe upon the legitimate rights and interests of either divorcing party or their children."

A bigamous marriage that is invalid due to bigamy

does not become valid because of a divorce or the death of the original spouse.

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The Civil Code and Criminal Law of our country both have explicit prohibitions and penalties for bigamous behavior. However, in judicial practice, there has been controversy regarding whether a bigamous marriage that is declared invalid can become valid if the legally married party has already divorced or if the spouse has already died. This judicial interpretation now provides clear stipulations, further strengthening the crackdown on bigamous behavior.

The judicial interpretation clearly states that even if the legally married party has divorced or the spouse has died by the time of litigation, a bigamous marriage cannot be rendered valid from the occurrence of these circumstances. If one party in the bigamous marriage was unaware of the situation (the innocent party), they may request compensation for damages from the party at fault according to the provisions of the Civil Code.

For example, after Xiao Ming married Xiao Hong, he entered into a bigamous marriage with Xiao Wang. Later, Xiao Hong passed away, but the marriage between Xiao Ming and Xiao Wang remains invalid. If Xiao Wang was unaware of Xiao Ming's existing marriage at the time of their union, Xiao Wang can demand compensation for damages from Xiao Ming.

Chief Judge Chen Yifang of the First Civil Division of the Supreme People's Court stated: "Bigamy is not a personal matter; it undermines China's fundamental monogamous marriage system and harms public interests and good social customs. Therefore, we firmly oppose and combat bigamy."

The act of granting property between spouses

How is the ownership of the property determined at the time of divorce?

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In practice, it is common for couples to agree on granting a property owned by one party to the other or adding the other's name to the title before marriage or during the marriage. However, the division of such properties often becomes a point of contention between the parties during divorce. The judicial interpretation clarifies the handling rules for dividing property given between spouses at the time of divorce under different scenarios.

The judicial interpretation distinguishes between two situations regarding property division during divorce: where transfer registration has not yet been processed and where it has already been completed, providing regulations for each case.

First Scenario: Transfer Registration Not Yet Processed

The judicial interpretation stipulates that if spouses have agreed to grant a property and there is a dispute over the ownership or division of the house during divorce litigation, which cannot be resolved through negotiation, the People's Court may rule based on the actual circumstances of the marriage and family, deciding which party will own the house and whether compensation should be provided by the party obtaining the house as well as the specific amount of compensation. This means that the party who promised to give the property cannot casually revoke this agreement.

For example, when Xiao Ming and Xiao Hong got married, Xiao Ming agreed to gift a property he purchased before marriage to Xiao Hong but did not complete the transfer procedures. When dividing assets during divorce, the court will consider factors such as the length of the marriage, whether they had children together, any fault in causing the divorce, and contributions to the family before making a judgment.

Judge Wang Dan from the First Civil Division of the Supreme People's Court explained: "If the marriage lasted for a long time, like 10 or 20 years, even without completing the transfer registration, the receiving party might have contributed significantly to the family. In dividing marital joint property during divorce, the receiving party can claim the property based on the agreement, and the court could rule that the property belongs to the receiving party. However, if the marriage was short-lived, the court may rule that the property remains with the giving party and consider compensating the receiving party to balance both parties' interests."

Second Scenario: Transfer Registration Already Completed

The judicial interpretation specifies that if the duration of the marriage was relatively short and the giving party has no significant fault, the court can rule that the house belongs to the giving party and determine whether the party obtaining the house should provide compensation and the specific amount based on the actual situation of the marriage and family.

For instance, after marrying, Xiao Ming transferred the deed of a house he bought before marriage to Xiao Hong. If they had been married for many years, Xiao Hong can retain the property. However, if their marriage was very brief and Xiao Ming committed no significant fault, the court would rule that the house belongs to Xiao Ming and require him to provide reasonable compensation to Xiao Hong.

Judge Wang Dan further explained: "When the transfer registration has been completed, we generally uphold the existing order of property and protect the reasonable expectations of the receiving party while promoting values of integrity. Once the transfer registration is done, the property is considered to belong to the receiving party. However, we also address particularly imbalanced situations; if the marriage was very short, say one year or less, or in some cases, divorce proceedings were initiated within a week after the transfer, and the giving party has no significant fault, even with the transfer registration completed, the court can still rule that the property belongs to the giving party, clearly expressing disapproval of acquiring substantial assets through a brief marriage."

Judges emphasize that when making judgments, the People's Court will balance the interests of all parties involved, ensuring that one party does not suffer both emotionally and financially due to their dedication to the family, nor does marriage become a means to gain improper benefits.

If one spouse privately gifts property to a "third party,"

can the other spouse demand its return?

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During the existence of a marriage, unless there is a special agreement, the property of both spouses is jointly owned. However, when one spouse privately gifts joint property to a "third party," can the other spouse demand its return? The judicial interpretation provides regulations on this matter.

The Supreme People's Court states that during a marriage, if one spouse makes a gift of marital joint property to another person for purposes such as bigamy, cohabitation with others, or any other violation of the duty of fidelity, it not only infringes upon the equal right to handle marital joint property but also represents a serious breach of public order and good morals. The judiciary firmly negates and rejects such behavior. Therefore, the interpretation clearly stipulates that if the non-gifting spouse claims that the gift violates public order and good morals and is invalid, the People's Court should support this claim, meaning that the non-gifting spouse has the right to request the return of the property.

For example, if Xiao Ming, who is married to Xiao Hong, secretly gives 100,000 yuan to a third party named Xiao Wang without Xiao Hong's knowledge, Xiao Hong can sue in court to invalidate Xiao Ming's gift and demand that Xiao Wang return the property.

Judge Wang Dan from the First Civil Division of the Supreme People's Court stated: "Between the innocent spouse and the third party who disrupts another person's family, we firmly protect the rights of the innocent spouse; this is our clear principle."

There have been concerns that in practice, couples might collude to use the name of the severely at-fault party to request a return, which does not serve as a punishment for the party who committed adultery. In response, the judicial interpretation specifically added provisions clarifying that within the marriage, the innocent spouse can request division of marital joint property without divorce; if this leads to divorce, the division of marital joint property can result in less or no share for the party who violated the duty of fidelity.

Judge Wang Dan further explained: "After the property is returned to both spouses, during the internal division between the spouses, the party who violated the duty of fidelity may receive no share of the property. If there are acts of bigamy, cohabitation with others, or other serious faults, they must also bear responsibility for divorce damage compensation to the innocent party."

Additionally, regarding child custody, the interpretation stipulates that if both parties request direct custody of minor children during divorce, and one party has engaged in bigamy, cohabitation with others, or other serious breaches of the duty of fidelity, this will be considered an adverse factor, and priority will be given to the other party for direct custody.

We also remind everyone to pay attention to understanding the marital status of their partner during the dating period to avoid having their legitimate rights and interests harmed.

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◆ Source of Material: All-China Women's Federation's Women's Voice

Property division during cohabitation, property ownership upon divorce... The Supreme People's Court issues important judicial interpretations!

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