MA v Xu

Case [2025] VSC 361 20 June 2025

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IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL COURT

COMMERCIAL LIST

S ECI 2022 04876

MA, JIYUN	Plaintiff
v
XU, JIELUN	Defendant

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JUDGE:	Croft J
WHERE HELD:	Melbourne
DATES OF HEARING:	18–21 March 2025, 23 May 2025
DATE OF JUDGMENT:	20 June 2025
CASE MAY BE CITED AS:	Ma v Xu
MEDIUM NEUTRAL CITATION:	[2025] VSC 361

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EQUITY — Trusts — Funds advanced from mother in China to son in Australia — Funds dissipated and property purchased — Whether agreement to invest funds or funds advanced by way of gift — Whether presumption of resulting trust applies — Whether presumption of resulting trust is displaced by presumption of advancement — Agreement to invest funds — Funds held on resulting trust — Re BBY (Receivers and Managers appointed) (2022) 409 ALR 558 — Bosanac v Commissioner of Taxation (2022) 275 CLR 37 — Martin v Martin (1959) 110 CLR 297.

EVIDENCE — Evaluation of witness evidence — Most compelling evidence is contemporaneous documentation — Assessment of credit — Indicators of unsatisfactory witness evidence — LL Up Pty Ltd v Kegland Distribution Pty Ltd [2024] VSC 651 — Brookfield v Yevad [2004] FCA 1164 — Painter v Hutchinson [2007] EWHC 758 (Ch) — Webb v Getswift(No 5) [2019] FCA 1533 — Gestmin SGPS SA v Credit Suisse (UK) Limited [2013] EWHC 3560 (Comm).

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr P Cawthorn KC and Mr P Caillard	Madgwicks Lawyers
For the Defendant	Ms K Weston‑Scheuber	Colin Biggers & Paisley

HIS HONOUR:

Background

The dispute between the parties relates to approximately AUD11 million that was sent by the Plaintiff (‘Jiyun’) to the Defendant (‘Allen’) during 2021 and 2022.

Jiyun claims that this money was provided to her son, Allen, as part of an ‘agreement’ that Allen would invest the money for her in Australia. Issues arise as to the nature of the consideration for any such agreement, ranging from Jiyun’s claim that this was in return for giving Allen AUD5 million that he could use to obtain an investment visa in Australia, to something more in the nature of mutual promises and dealings between the parties.

Allen, on the other hand, claims that the AUD11 million payment was, in fact, a payment by way of a gift to him and was his money to use as he pleased. Jiyun subsequently became angry when she learnt that Allen had spent some of that money on very expensive jewellery, expensive restaurant meals, a car and also on cosmetic surgery on his eyes. Jiyun’s anger was made clear in communications between her and Mr Peng, Allen’s paternal uncle, when she contacted him.[1] As a result of Jiyun’s revelations as to Allen’s spending, Allen made various ‘apologies’ to his mother and to Mr Peng. Allen claims that these were not admissions that he had used her money but, rather, that they represented a realisation that he had spent a good deal of money on frivolous…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading MA v Xu

Details

AGLC: MA v Xu [2025] VSC 361
Case: [2025] VSC 361
Decision Date: 20 June 2025

CaseChat Overview and Summary

The case of MA v Xu involved a dispute between a mother and her son regarding funds transferred from China to Australia for the purpose of purchasing property. The Federal Court of Australia was tasked with determining whether the funds were advanced as a gift or pursuant to an agreement to invest, and whether the presumption of a resulting trust applied. The mother argued that the funds were a gift, while the son contended that they were advanced under an agreement to invest.

The court was required to evaluate the evidence presented to ascertain the true nature of the transaction. The key issue was whether the funds were held on a resulting trust or if the presumption of resulting trust was displaced by the presumption of advancement. The court had to consider the contemporaneous documentation and the credibility of the witnesses' accounts to resolve this matter.

The court concluded that the funds were advanced under an agreement to invest, rather than as a gift. This conclusion was based on the contemporaneous documentation which indicated an agreement to invest the funds for a specific purpose. The court found the mother's evidence less compelling due to inconsistencies and the son's evidence more credible. Therefore, the funds were held on a resulting trust for the mother. The court rejected the son's argument that the presumption of resulting trust was displaced by the presumption of advancement.

The court ordered that the property purchased with the funds be held on trust for the mother, reflecting the resulting trust established by the agreement to invest. The son was directed to transfer the property to the trustees appointed for the mother. This decision underscores the importance of contemporaneous documentation and the need for clear evidence to establish the nature of financial transactions in trust disputes.

Orders