Judge: Property magnate lied about mistress over £3m 'gifts'

One of the world's richest men was branded a liar today as he lost a High Court battle with his former mistress over ownership of two London properties worth more than £3million.

Mr Justice Norris said the property magnate had lied in saying that masseuse Fuk Fei Wu was only his employee and not his lover.

The billionaire, who cannot be named for legal reasons, had claimed beneficial ownership of two houses in West Kensington bought for £3.1 million in 2008.

But the judge found that although one of them had been purchased with his own money, he had intended to give it to Ms Wu as a gift.

The transaction had been carried out in the name of her Seychelles-based company, Favour Easy Management Ltd.

The judge also decided that the second house had been purchased by Ms Wu as a personal venture using loans without his involvement.

Although she later used money paid into her bank account to pay off part of the borrowing, this did not entitle him to a constructive trust because when he paid the money, he also meant it to be a gift.

The tycoon had claimed that he wanted Ms Wu to run the properties as hotels under the complex and secretive business model known as "Zhou Wen Xuan", named after a Chinese businessman from Ms Wu's hometown.

However, Ms Wu insisted she was the businessman's mistress and described how they had met when he responded to a newspaper advert she placed seeking a "spouse".

She said he had encouraged her to emulate him and Zhou Wen Xuan, who had started with nothing and built a commercial empire. Although the judge found that Ms Wu was "frequently an untruthful person", he said that when it came to their relationship he believed she was telling the truth.

"(He) was a generally truthful person: but he has lied to me because, I think, he sees it necessary for his honour and his reputation to demonstrate that he can control people within his realm of management," the judge said.

"Ms Wu resisted his control. He certainly does not care about the money, which is to him next to nothing."