Au Yuk Lin v Wong Wang Hin Eddy
Court of Appeal
Civil Appeal No 234 of 2012
Lam V-P, Lunn JA and McWalters J
Trust
5, 17 September 2013

Presumption of advancement — transfer of property from mother to son

A couple provided the capital for a company (“C”) set up by their two sons, including the defendant (“D”), and its first two years of operating expenses. In 2006, the mother (“P”) transferred 180,000 shares in C to both sons by inter alia an instrument of transfer ostensibly for HK$180,000 but no payment was ever made.

P brought proceedings claiming the shares were held on resulting trust for her, while D contended the shares were a gift. The judge in the lower court accepted P’s evidence and her witnesses that she had lent the shares to her sons for the sole purpose of satisfying the requirement for banking facilities that they become C’s majority shareholders; and that she did not intend to transfer her beneficial interest in the shares. He held that P had rebutted the presumption of advancement. D appealed.

Held, dismissing the appeal, that:

It was not necessary to resolve in this case the question of whether the presumption of advancement applied as a matter of law to a transfer of property from a mother to her son. Even assuming that it did, the presumption only applied where the intention of the transferor could not be resolved by sufficient relevant and admissible evidence.

Here, there could not be any common intention that the transfer was a gift.

Jurisdictions: 

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