Fulfilment of property legacies by submitting a will to the probate court?

On 13 August 2018, the Rostock Higher Regional Court ruled on a case that is frequently encountered in inheritance law practice. In his legacy, the testator instructed that his children should transfer "by way of legacy the company shares in Bauernhof HH - GbR as well as 1/3 co-ownership shares in land registered with the Rostock District Court, land registers (...) in equal shares". In addition, the testator formulated "I hereby make the necessary declaration of agreement in rem pursuant to § 8 73 para. 1 BGB and authorise the entry of the transfer of ownership to my four children with effect from. In the land register.

The children then submitted the will and applied for a change of ownership in the land register, the so-called land register correction.

The Rostock Higher Regional Court rejected the legatees' rejection of the application to amend the land register and stated that a legatee does not become the legal successor of the testator in the event of the testator's death. The heir becomes the legal successor and the legacy only establishes a right of claim of the legatee against the heir upon the death of the deceased, but not a transfer of the bequeathed object to the legatee. The transfer of ownership to the legatee always requires a legal transfer of ownership agreement between the heir(s) and the legatee(s). If, in the present case, the testator has authorised the transfer of ownership in accordance with Section 873 BGB, this declaration is ineffective, as such a declaration only has to be made before the competent authority if all parties are present at the same time.

 

If the testator had wanted to avoid a conflict between the heirs and legatees in the present case, this would have been easily possible by arranging for the execution of the will. An executor could have concluded the corresponding contracts to implement the will when the legacy was asserted. If, for cost reasons, an attempt is made to avoid the costs of a certificate of inheritance by granting lifetime powers of attorney that are effective after death, this is generally associated with considerable legal uncertainties and there is also the risk of a misuse of the power of attorney, which is why such solutions should generally only be chosen after detailed legal or notarial advice.

 

The conclusion of the case is that legatees cannot derive a claim for a change to the land register in their favour directly from the will; they must assert their claims for the surrender of the property and a change to the land register against the heirs. In the context of such dispositions, testators should also consider whether it makes sense for them to arrange for the execution of a will: on the one hand, the execution of a will regularly ensures that the will of the testator is faithfully implemented and thus prevents disputes between the heirs; on the other hand, it is associated with costs that regularly amount to 3-5 % of the estate. In view of the fact that it is usually a matter of assets that have been painstakingly built up over a lifetime or even over generations, which are to be processed, such an amount should of course not be an obstacle. Furthermore, both the material and immaterial costs (destruction of family peace) of inheritance disputes are regularly higher than the costs of a professional executor.