A client, whom I have been advising for a very long time used to answer to a lucent description of an
especially harmonic family life: Have they already inherited anything conjointly? In this respect a quotation of G.E. Lessing: Humans rarely seem, what they are and rarely are they better than
they seem.” has its special meaning as to the Law of Inheritance.
The reason why harmony may be lost among the members of a community of heirs can be a result of the rule [in German Law] that any decisions which may lead to a reduction of value in the estate needs a common vote of all members. A quorum of the majority will only be possible as long as a measure of administration of the estate results from this decision. This makes a decision, if a measure is of administrative nature (majority decision) or rather an act of disposal (unanimous decision) to be the first reason for dissenting opinions. Even jurisdiction might not always be unambiguously here.
A Community of Heirs comes into existence by a testator leaving
a number of heirs irrespective of the fact whether they will be heirs by a last will or by law. [According to German Law] Members of such a Community do not hold shares of an estate, but gain a
legal position enabling them to divide the estate into shares, which can be allotted to the single heir according to either a last will and/or legal succession by law. Any item of the
estate will legally belong to each heir conjointly with all other heirs. Shares of an Estate will come as a result of a hereditary dispute. In principle there are two options to achieve a
division: a mutual Agreement or a legal Dispute.
A Mutual Agreement on a distribution of inheritance can [according to German Law] be accomplished by
A legal dispute might be started by filing a claim at the courts,
If a testator organises his estate proactively, a testator will escape a conflict among heirs and enable a mutual understanding by
Example: A testator appoints his three daughters equally as heirs. Each daughter is entitled to one third of the estate. The estate has three condominiums and three bank accounts in it. At the time of the testator‘s death all of the flats and all of the bank accounts will go to all three of the daughters who then shall form a community of heirs as long as they do not mutually agree on who shall be entitled to which condominium and/or bank account.
Therefore one daughter would not be entitled to sell one flat or receive money from one account of which she thinks it was the one allotted to her specifically. As long as a Community of Heirs exists disposals shall be impossible without a consent among the three sisters.
If one sister wishes to end the community she is entitled at any time convenient for her to ask or claim for a distribution of the shares either by mutual agreement or by filing a claim. The estate stripped off obligations will be allotted to each heir accordingly.
As far as the estate has real estate in it, this must be silvered before a share of its value can be allotted to members of a community of heirs. An economic recovery might be achieved consensually by a mutual agreement or in a confrontative manner by filing an application for a foreclosure auction, the latter often results in a reduction of the estate as within such an auction a price resembling market conditions will not always be possible.
A testator can avoid a dispute between heirs (at least for a set period of time) if a testator so decides in a testament, because a testator might want to preserve a family business. In a case of this kind it might also be a wise decision to instruct an executor of the respective last will, who shall secure that an estate will not be divided too early.
Once a testator instructed an executor, a division of the estate shall be the executors task. Heirs will not be entitled to an agreement although it was mutually agreed upon, if this agreement would imply a circumvention of stipulations in a last will. Heirs shall then be entitled to claim a division of the estate according to the stipulations of the respective will.
Apart from this a notary public will upon an application of one heir procure a formal procedure to conclude a mutual agreement among heirs, if there is no executor instructed and only a consensual division of the estate is in question.
As far as a mutual agreement among heirs seems unlikely, but not impossible, a mediation between heirs can be a less formal way to ease tensions between heirs and save costs of a legal dispute. Because of my many years of experience I would offer a mediation for members of a community of heirs and on very special occasions (in tricky emotional cases also with the support of a psychotherapist).
The last step to the dispute is the judicial route in the form of an inheritance action. The necessary consents of the co-heirs are then replaced by a judgment.
Please do not hesitate to either make a telephone call or write an e-mail, should you have any questions which I will be happy to answer during a personal discussion.