Mother-in-Law Sues Son-in-Law Who Took $90K as “Consulting Fee” Instead of Transferring Over a Business

Last Updated on 2023-08-22 , 12:19 pm

Would you charge your family members for helping them to do some work?

Some would say yes since labour is labour and everyone needs to get paid for their efforts.

Others would frown at the thought of trying to get money from your family members since family means you help each other out at no cost.

If you fall into the former camp, how much is too much to charge?

One man claimed that his mother-in-law should pay him $90,000 as a “consulting fee” for transferring over a laundromat business.

The case went to court.

Here is what happened.

Mother-In-Law Sues Son-In-Law Over $90,000

This is quite a peculiar case.

A mother-in-law gave her son-in-law $90,000 to hand over the laundromat business to her. However, she ended up suing him.

The plaintiff in this case is Mdm Chen Miao Xiang (Hanyu pinyin). Her son-in-law is Mr Wang Ji Yong (Hanyu pinyin).

Mr Wang was the owner of a laundromat business.

On 5 March 2013, Mdm Chen gave Mr Wang $90,000 to ask Mr Wang to hand over the laundromat business to her.

Mdm Chen alleges that Mr Wang took the money but did not transfer the business to her.

Speaking to Zaobao, Mdm Chen shared that Mr Wang had told her daughter in May 2015 that he would be willing to buy back the laundromat business for $140,000.

Mdm Chen agreed to this arrangement, but Mr Wang reneged on it. The former then brought the latter to court, asking him to transfer the business over to her or to give her $140,000.

Court Ruled in Favour of Mother-In-Law

According to court documents, Mr Wang admitted he took Mdm Chen’s $90,000 but said that this was a “consulting fee” rather than the sum Mdm Chen paid for the laundromat business.

Mr Wang argued that Mdm Chen wanted a year’s time to learn how to operate the business and the $90,000 was for Mr Wang’s consultancy efforts over that year.

That’s why he didn’t want to transfer the laundromat business over to her. Mr Wang also countersued Mdm Chen for $127,500 worth of “consulting fees” and $72,200 for employee wages.

The court investigated and found that the laundromat was under Mr Wang’s name, but it was Mdm Chen who was running the business and had control over the finance department.

As such, the judge found that Mdm Chen was already the owner of the business. In addition, it was not complex to run a laundromat business, and Mr Wang’s argument that he had to teach Mdm Chen the ropes was not credible.

The court finally ruled that Mr Wang had to transfer the laundromat ownership over to Mdm Chen and she did not have to pay him any further consultancy fees.

However, the court asked Mdm Chen to pay $72,200 worth of salary to Mr Wang, which Mdm Chen is now appealing.