Division order + value adjustment
February 13, 2010 | 20,00 EUR | answered by Bernhard Müller
Dear Sir or Madam,
My parents have stated the following in their will:
In the event of the death of the surviving party or simultaneous death, we hereby designate our common children as our final heirs:
1. XXX
2. XXX
3. XXX
each receiving 1/3.
We hereby make the following division order:
Our 1. XXX shall receive our house property as sole ownership.
He is obligated to pay out to his siblings 100,000 DM each after the death of the last surviving of us.
Should 1. XXX have passed away, the division order shall be invalid and statutory succession shall apply.
We estimate the value of our net assets to be approximately 300,000 DM.
The cash assets amount to approximately 200,000 euro.
So far, so good...
Question 1:
Does the division order imply that the 100,000 DM must now be paid out as a fixed amount without taking into account the market value (approximately 300,000 euro) of the house? Or does it mean that the market value can be determined based on an appraisal, and then an additional value compensation must be made from the cash assets to 2. XXX and 3. XXX?
According to my knowledge, a value shift is not permitted in a division order, even if a fixed amount has been specified in the will. In my opinion, the value shift should therefore be balanced out through the cash assets.
Am I correct in this assumption, or am I mistaken?
Best regards,
Willi Windel
Dear questioner,
the testator can determine the value of the property bindingly for the division. (Palandt Rz. 2 to § 2048 BGB)
In this case, the value was set by the testator at 300,000 DM. Therefore, the value cannot be determined by an appraiser anymore, but 1XXX must actually pay 100,000 DM = 51,129.19 euros to each of the other two as compensation for the property.
If the testator had wanted something else, he would have only written about equal value without specifying a fixed amount.
The division order would only be non-binding for the heirs if it was evidently unfair. This would be the case if one of the heirs would receive less than their compulsory portion due to an obviously incorrect value determination by the testator. With a market value of 300,000 euros + 200,000 euros in cash, the statutory share is 166,666.66 euros and the compulsory portion is 83,333.33 euros.
The compensation payment of 51,129.19 euros + 1/3 of the cash is 117,795.86 euros. Therefore, no unfairness can be determined.
However, it could be unfair if the testator had been in a coma for years before his death, could not change the division order, and it can be assumed that he would have done so if he had the opportunity.
The burden of proof would fall on the person who wants to deviate from the division order.
I hope that my answer could help you further.
Best regards,
Bernhard Müller Attorney at Law
