What is an inheritance agreement?
In addition to the unilateral will of the testator alone, an inheritance contract includes the relationship between the testator and a third party. In a marriage, for example, the third party is usually the spouse and, if applicable, the joint children. The inheritance contract is drawn up jointly and, unlike a will, is a binding contract between all parties. As it is a contractual union over an inheritance, this type of provision may limit the testator’s freedom to make a will.
What does an inheritance contract say?
A binding inheritance contract between the testator and a third party is usually intended to facilitate the administration of a joint estate. For example, an unmarried couple may jointly enter into such a contract as contractual partners to secure the future of their joint assets. This is because only married couples or registered civil unions can draw up a joint will, but not unmarried couples. The inheritance contract secures joint property and usually also includes a waiver of compulsory inheritance or portion. It is important that these provisions are drawn up by a notary and that all contracting parties, both the testator and the heirs, are present in person. In addition to the waiver of inheritance, the contract may stipulate pre- and post-inheritance rules. The example of a family business can illustrate both cases of waiver of inheritance and pre- and post-inheritance provisions. The father, as owner of the family business and as testator, enters into an inheritance contract with his spouse and children. For example, the contract could include a waiver of inheritance by the spouse (or, more generally, the longer-lived spouse), who agrees that the children will inherit the family business directly. The contract may also contain provisions, for example, that the children are obliged to continue the family business. A post-inheritance provision could also come into play if the testator stipulates that the family business will first pass to the spouse as prior heir and the children will be designated as post-inheritors. The lawyers of the Frankfurt law firm can help you in advance.
How much does a succession agreement with a notary in Frankfurt cost?
There is no general flat rate for the notarial preparation of the provisions of such a contract. As stipulated in the Notarial Remuneration Ordinance, the costs mostly reflect the amount in dispute of an inheritance, its value and its importance.
What is the difference between a will and an inheritance contract?
Unlike a contract of inheritance, a will is a last unilateral disposition of the testator. Only the testator can determine his own inheritance with a will, either in handwritten form or with the notarial assistance of a specialized Frankfurt lawyer. On the other hand, the inheritance contract is a joint and, above all, binding contract between the testator and the other parties to the inheritance, which only becomes effective with notarial certification. Drawing up a will and an inheritance contract are not mutually exclusive. By means of notarial advice, it is possible to find out individually what makes more sense in the event of death: an inheritance contract or a will (joint or individual).
What happens with the inheritance agreement in case of divorce?
Unlike a joint will, which loses its validity upon divorce, divorce is irrelevant for an inheritance contract. Therefore, it is often advisable for married couples to include a corresponding divorce clause in their joint contract. So-called cancellation clauses usually state that the provisions of the inheritance contract also lose their validity in the event of divorce. However, a cancellation clause is not necessarily part of an inheritance contract: each married couple can decide for themselves whether the inheritance contract with the provisions of the inheritance contract should remain valid after divorce. Our lawyers specializing in inheritance law in Frankfurt will be pleased to advise you.
When does it make sense to make an inheritance agreement?
The inheritance contract, as a jointly drafted and binding contract, primarily brings security to all parties to the inheritance. There are clear instructions as to what is to happen to the inheritance in the event of death and who inherits what or, as the case may be, who renounces what. The feature of a binding contract creates clarity for all parties. It can be very useful, for example, when transferring shares in a company, since it is decided jointly before death what is to happen in the event of death. The provisions of an inheritance contract can be modified by mutual agreement as long as all parties to the estate are alive. If one of the parties dies, the contract is binding and cannot be modified.
What can be regulated by a succession contract?
The inheritance contract, as a contractual association of several inheritance parties, clearly regulates the property situation and the inheritance claims in the event of the death of one of the inheritance parties. The most diverse cases of ownership and inheritance in the event of death can be determined here. A contract of inheritance can be concluded between unmarried couples for whom it is not possible to draw up a joint will. However, there can also be a contract of inheritance between parents and children that clearly regulates the takeover of the family business or the general transfer of assets. With an inheritance contract there is the possibility not only to regulate a transfer of assets, but also to stipulate a waiver of inheritance or certain obligations that go along with an inheritance.
How can the inheritance contract be subsequently modified?
Once an inheritance contract has been drawn up jointly with the personal presence of all parties to the inheritance and by a notary, the contract is binding. Such a contract can only be modified or adapted if all contracting parties agree to the changes. Therefore, the parties to the inheritance must jointly find a new regulation. In turn, the new regulation must be notarized. The validity of an inheritance contract is only renewed by amicable amendment and notarization. A lawyer specializing in inheritance law from our law firm in Frankfurt will be happy to advise you in this respect. In order not only to amend the inheritance contract, but also to annul it, the contracting parties must meet to jointly draw up a notarially supported annulment agreement. With this declaration to the contracting parties, a previously drafted contract becomes invalid.