News on German and Italian inheritance law: wills, compulsory portions, legal heirs, gifts in Italy and Germany

In a case decided by the OLG Oldenburg on 2022, the question arose as to whether the loss of inheritance rights occurs when a new partnership is entered into. This question may also be relevant in Italian inheritance law. The case concerned a testator who had made a will in 2005 appointing his partner and his daughter as his heirs. After the testator moved into a nursing home in 2016 due to advanced dementia, his partner married a new partner in 2020. After the deceased's death the following year, a dispute arose over the inheritance.

The former partner applied for a certificate of inheritance. The decedent's daughter objected and challenged the will. She argued that if the testator had known that his partner would move on and marry during his lifetime, he would have changed the will to exclude him as an heir.

The daughter was unsuccessful at trial. It is true that the testator assumed that the cohabitation would continue when he made his will. According to case law, such a will is generally invalid even if the underlying cohabitation no longer exists. However, an exception applies if it can be assumed that the testator would have wanted the will to be valid in this case (so-called "hypothetical will"). This exception applies in this case: The case described, in which dementia made it impossible to continue the de facto cohabitation, is to be assessed differently from the case in which the partners live separately or one of the partners culpably turns to a new partner outside the civil partnership. In the present case, however, it was only because of the dementia that the cohabitation could not be continued in the same way as before.

Anyone who, due to extraordinary circumstances, is in such an isolated place that it is impossible or very difficult to draw up a will before a notary, may draw up a will, for example, by making an oral declaration in the presence of three witnesses. The three witnesses must be present and participate in the oral declaration of the will, its recording and reading, and its acceptance by the testator. They must therefore be present during the entire execution of the will, which must be recorded and signed by the witnesses.

In the case decided by the Düsseldorf Higher Regional Court on 6.1.2022, an emergency will was not valid because the witnesses who co-signed the will were not present at the same time. Moreover, they had read the minutes to the testator one after the other and individually and had signed the text.

The declaration of avoidance in due form with respect to a previous bequest requires the original deed to be received by the probate court if the declaration is submitted in publicly notarized form.

Transmission of the notarized disclaimer as a PDF file to the probate court through the special electronic attorney inbox is not sufficient to comply with the required form for an effective disclaimer.

The statement of avoidance can only be made within six weeks. The period begins at the time when the person entitled to contest becomes aware of the grounds for contest.

In the case decided by the Oberlandesgericht Bamberg, siblings challenged a disclaimer. A certified PDF file was sent via a special lawyer's mailbox, and the original was then sent by mail. The original, however, was received by the court after the deadline and could not be used to revoke the renunciation of inheritance.

In principle, social welfare agencies pay benefits to anyone who needs them. However, they can also recover the money if the person in need of assistance still has claims against third parties. Benefit providers can transfer these claims to themselves and then enforce them against the third parties themselves. Such claims against third parties may include inheritance claims. Thus, if a person to whom the state has granted social benefits becomes an heir, he can transfer this claim to himself and assert it against the other heirs.

The OLG Oldenburg had to decide this question in the following case: A city had provided a man with about €19,000 in social benefits for years. When his mother died in 2015, she appointed the man's son, her grandson, as his sole heir. The man himself did not become an heir and was therefore only entitled to a compulsory portion. He himself died in 2020, and the city had transferred the man's compulsory portion claim against his deceased mother to itself in the amount of the social benefits paid. After his death, the city turned to the grandson as the debtor of the compulsory portion and demanded payment. With success, as the judges ruled.

When arranging a funeral in Germany, it is important to understand that the person making the funeral arrangements is generally responsible for the costs. This also applies to cases where heirs are involved. Even if someone other than the heirs hired the funeral director, they may still be held liable for the costs. As a general rule, it is the responsibility of the next of kin to decide on the type and manner of burial, unless the deceased has made other arrangements. The rules vary from state to state and clarify which next of kin has the primary right of decision.

A notable case was heard by the OLG Koblenz, in which the son of a deceased person organized the funeral but later realized that he was not the sole heir. He then sought reimbursement of the funeral costs from the estate of the other heirs.

The OLG ruled that the heirs must reimburse the son for the funeral expenses incurred. The deceased's position in life is decisive, i.e. only the costs of an appropriate and dignified funeral are taken into account. The economic and social circumstances of the deceased are particularly relevant.

For German clients dealing with cross-border inheritance matters between Germany and Italy, our firm offers comprehensive legal support. We understand the complexity of such cases and specialize in providing competent advice and representation in all aspects of inheritance law.

If the spouse or descendants were not already living in the deceased's household, they can inherit the deceased's home tax-free if they live in it immediately after the death or make preparations to move in as soon as possible.

In a case decided by the Federal Fiscal Court (BFH) on May 6, 2021, a taxpayer inherited a semi-detached house from his father. The deceased lived in one half and the inheriting son and his family lived in the other half. After the inheritance, the son made extensive improvements to the house so that he and his family could use it as a single-family residence. The tax office denied the inheritance tax exemption because of the long delay in moving in.

According to the BFH, the decisive factor is that the acquired property is immediately occupied by the heir himself. If this is not possible, it must be clear from the outset that the heir intends to use the property himself, even if moving in is delayed due to construction work or similar. In principle, however, a delay of 6 months is still reasonable.

All information has been compiled to the best of our knowledge. However, no liability or guarantee can be assumed for their content. Due to the sometimes abbreviated descriptions and the individual characteristics of each case, the information provided cannot and should not replace personal advice.

In a case heard by the Oberlandesgericht Koblenz on November 26, 2020, a testator bequeathed to her partner a VW Polo that she had sold four months before her death. The partner argued that the bequest should be interpreted to mean that he was entitled to the proceeds from the sale of the vehicle.

According to the German Civil Code (BGB), if the bequeathed property ceases to be the property of the testator prior to death, in case of doubt, an entitlement to compensation is presumed. However, the voluntary sale of the bequeathed object does not constitute a deprivation, nor does it lead to the destruction of the object in the legal sense. Consequently, the partner had no legal claim to the proceeds from the sale of the car.

Many parents decide to make financial gifts or transfer real estate to their child and their spouse. But what happens to these gifts if the marriage breaks up? Does the divorced spouse have the right to keep the gift?

In 2020, the Higher Regional Court of Oldenburg had to decide on such a case: in 2013, a mother gave her daughter and her husband a condominium that they did not live in but rented out. After the separation in 2015 and the subsequent divorce in 2017, the mother demanded the return of the gift in the form of a sum of money from her former son-in-law, referring to the "discontinuation of the basis of the transaction". The gift had originally been made with the intention of supporting her daughter's marriage. Since the hope of a lasting marriage did not materialize, she argued that she could recover the value of the gift, less a discount for the duration of the marriage.

However, the judges concluded that there was no "frustration of contract" and therefore no recovery from the former son-in-law. The nature of a gift implies that no consideration is expected, and repayment is usually demanded only in the event of serious misconduct on the part of the donee towards the donor.

Another case could be the transfer of real estate as a family home to the child and his or her spouse. In the case of a gift of residential property directly related to the continuation of the marital relationship, recovery could theoretically be considered in the event of the breakdown of the marriage. In this case, however, the property was gifted and used as an investment.

Generally, it is the heir's responsibility to pay for the deceased's funeral. These costs are considered liabilities of the estate and therefore reduce the value of the inheritance. However, the Federal Court of Justice recently ruled that the costs of grave care are not considered liabilities of the estate that reduce the inheritance.

This rule applies even if the testator did not divide the inheritance in full in his will and stipulated that the remainder should be used for grave maintenance over a period of 20 years. A grave maintenance obligation imposed on the heirs by the testator in his will does not result in a reduction of the compulsory portion.

If a decedent bequeaths his or her own home, which he or she lived in until his or her death, the heirs can usually claim a tax exemption. If the surviving spouse inherits the home and continues to use it by living in it for at least ten years, no inheritance tax is payable. If the house is inherited by the children, the inheritance tax is also waived, provided that the property is used by them for at least ten years and the living space does not exceed 200 square meters. This exemption does not apply to heirs other than spouses or children, in which case the acquisition is taxable.

In 2020, the Düsseldorf Tax Court ruled on a case involving the retroactive withdrawal of the tax exemption. A woman had inherited a property from her deceased father and lived in it for several years, but did not meet the required minimum useful life of ten years. The house was sold and then demolished. As a result, the previously granted tax exemption was retroactively revoked. The woman argued that the demolition was necessary for economic reasons, as renovation would not have been profitable. In addition, she could no longer use the stairs to the upper floor, which she exclusively used, for health reasons.

Although the Tax Court was sympathetic to the fact that the woman had to give up home ownership because of the problems with the building, it did not consider this to be a convincing reason for ending home ownership. In the court's opinion, the woman's health was also not a sufficient reason since the property had been used until the move.