Is money from a parent a gift or a legitimate loan?

Take this situation:

  • The husband’s father gives the husband and the wife $250,000 before they separated for the express purpose to assist them in the purchase of their matrimonial home
  • The parties separate and commence proceedings in the Federal Circuit Court seeking orders for sale of their home and a split of all assets
  • The husband’s father intervenes in the proceedings and argues that the sum of $250,000 advanced by him was a loan and at all times he had agreed with the husband and the wife that such sum would be repaid to him

Is this sum a gift to the husband or a loan?


  • The categorisation of this sum will require some substantial proof either way as support for whichever claim
  • If a loan there would presumably be a document containing dates for repayment with or without an interest component included
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