Securing a donation
September 18, 2010 | 30,00 EUR | answered by RA Kristian Hüttemann
Dear Sir or Madam,
we are acquiring a new car and would like to gift our previously used car to our son (valued at approximately €5,000). He intends to register it in his wife's name for the purpose of obtaining a cheaper insurance rate (as a second car).
Under normal circumstances, there would be no issue with this arrangement. However, he is currently experiencing significant difficulties with his partner and they are considering separation. Could this potentially pose a problem for our son in the event of a separation?
In this situation, we do not want the car to become joint property. Especially because the registration will be in the name of his wife, there is a concern that our son may legally lose the car.
What preventive measures can we discuss with our son to ensure that such a situation does not occur, or that the gift reverts back to us?
I look forward to your response.
Dear inquirer,
Thank you for your inquiry, to which I would like to respond as follows based on the information provided.
The gratuitous transfer of your previously used motor vehicle to your son would be legally unobjectionable and would not lead to concerns that his wife would acquire co-ownership.
If you transfer the car to your son as a gift, he would acquire sole ownership of it, as each spouse remains the sole owner of their assets during the marriage. Therefore, each spouse is solely responsible for managing their own assets during the marriage.
These principles apply at least in the statutory regime of community of gains - which is likely to be applicable in this case. Accordingly, after the gift, the car would be exclusively assigned to your son's assets. Only he would acquire ownership, and only he would have the right to dispose of the car.
Given these clear ownership allocation relationships, it would not be necessary to construct a legal structure for the gift (such as making the gift subject to a condition with a fallback option under § 525 of the German Civil Code) to secure your son's rights.
Furthermore, a different legal assessment of the situation would not arise from the fact that the car would be registered in his wife's name after the gift.
It is important to differentiate between the vehicle registration document and the vehicle registration certificate. If your son acquires ownership of the car, he also acquires ownership of the vehicle registration document (§ 952 of the German Civil Code).
However, ownership and the registered keeper do not have to be the same person. It is entirely possible according to registration law that the vehicle registration certificate can be issued to another person. Similarly, it is not detrimental from an insurance perspective if the owner and the car insurance policyholder are not the same person.
The vehicle registration certificate only serves as proof of the legally required registration of the car under the Road Traffic Act. It does not provide any information regarding ownership of the car. Similarly, it does not indicate whether the person using the vehicle in a specific case is authorized to do so.
In conclusion, registering the car in the name of the spouse would be legally unobjectionable and would not change your son's ownership status.
I hope the above explanations have provided you with a suitable orientation. Feel free to ask if you have any further questions.
Best regards,
Kristian Hüttemann
Attorney at Law
