Zellweger v Zellweger 2018 BCSC 1227 discussed inter alia the criteria for determining if monies advanced within the family context are a loan or a gift.

Zellweger cited Byrne v Byrne 2015 BCSC 318 at para. 43 in which the court sets out the relevant factors for determining whether funds advanced in a family law context are loans or gifts:

“These were addressed in Kuo v Chu 2009 BCCA 405 at para. 9 , where the Court of Appeal adopted the factors described in Locke v Locke 2000 BCSC 1300 as applicable to the question of whether alone or gift was intended:

• Whether there were any contemporaneous documents evidencing a loan;
• whether the manner for repayment is specified;
• whether there is security held for the loan;
• whether there are advances to one child and not others, or advances of on equal amounts to various children;
• whether there has been any demand for payment before the separation of the parties;
• whether there has been any partial repayment; and, whether there was any expectation, or likelihood of repayment.

After reviewing the facts of the case, the judge in the Zellweger decision held that the funds were properly characterized as loans.

In Berry v. Page (1989) 38 BCLR (2d) 244 BCCA the appeal court discussed the importance of properly characterizing the nature of alone in order to determine when the limitation period under the previous Limitation Act begins to run:

“the characterization of the loan as either a contingent loan or demand loan determines whether or not the action is statute barred under the Limitation act. It is well-established of the cause of action accrues, and the statute of limitation runs, from the earliest time at which repayment can be required. For demand loan, the statute of limitations runs as of the date of the advancement of the funds, and not from the date of the demand. No demand is necessary in order for the cause of action to arise.”