In order for the person entitled to a compulsory portion to be able to calculate the amount of their claim to a compulsory portion, the person entitled to a compulsory portion is first entitled to demand a list of the estate from the heir. In such a list, the individual items belonging to the estate and their value-forming factors must be listed. If the estate includes a car, for example, it is not sufficient to state „Mercedes car“. Rather, further information must be provided on the type, year of manufacture, mileage, equipment, etc., because these factors determine the value and a value cannot be determined without this information. However, it is often the case that the person entitled to the compulsory portion is unable to determine the value even if more detailed information on the item is provided in the list, for example because they lack the expertise to do so. This is particularly likely in the case of real estate and jewellery. Therefore, in addition to the list, the beneficiary of the compulsory portion can also demand that the value of the items in the estate be determined (Section 2314 para. 1 sentence 2 clause 2 BGB).
Is the value of the object of the estate determined by an expert opinion?
The purpose of the right to a valuation is not to determine the value of the estate at the time of the inheritance with binding effect for the beneficiary of the compulsory portion and the heir. Rather, the valuation claim is intended to make it easier for the beneficiary of the compulsory portion to assess the risk of a legal dispute regarding the compulsory portion (BGH, judgement of 29 September 2021 - IV ZR 328/20).
The calculation of the compulsory portion is based on the existence and value of the estate at the time of death. The beneficiary of the compulsory portion is to be placed in the same economic position as if the estate had been converted into money at the time of the testator's death. The valuation of the estate is therefore based on the so-called fair market value, i.e. the value that corresponds to the sale value at the time of the inheritance. As valuations by an expert are also associated with uncertainties and actual sales values sometimes differ greatly from the values determined by experts, the question arises as to whether a valuation by an expert, which the beneficiary of the compulsory portion has requested himself, is binding. According to case law, this is not the case. Even after the submission of an expert's report on the value of an item of the estate, the person entitled to a compulsory portion can base a different value on this item of the estate. This also applies if the valuation report was prepared and submitted at the request of the person entitled to a compulsory portion. As already explained, the right to a valuation pursuant to Section 2314 para. 1 sentence 2 clause 2 BGB serves to provide the beneficiary of the compulsory portion with a better basis for assessing their claim. If the person entitled to the compulsory portion then asserts a higher value of the relevant item of the estate in the lawsuit than determined by the expert, the person entitled to the compulsory portion bears the burden of proof and the litigation risk in this respect. On the other hand, the heir can also claim a lower value of an item in the estate than previously determined by the expert in a dispute over the amount of the compulsory portion claim. In practice, however, it is usually the case that both the person entitled to the compulsory portion and the heir are guided by the expert's report and only in rare cases are deviating values claimed.
What is the relevant value if the property (or another item in the estate) is sold after a valuation report has been drawn up?
If an appraisal was carried out on a property belonging to the estate and the property was subsequently sold, the question arises as to whether the sale value or the value according to the appraisal should be used to calculate the amount of the compulsory portion claim. According to the case law of the Federal Court of Justice, the actual sales value should be used - except in exceptional cases - if the property was sold soon after the inheritance. The sale price then generally takes precedence. If the property is sold to a third party, it can generally be assumed that the heir, as the seller, has endeavoured to achieve the highest possible sale price and that the sale price corresponds to the so-called fair market value. In some cases, however, there may be indications that the sale price does not correspond to the fair market value, for example if the property was sold to a close relative or partner of the heir or if there are other circumstances that cast doubt on the fact that the price is the result of a negotiation that would otherwise have taken place between unrelated third parties. However, the actual sale price is not binding for the beneficiary of the compulsory portion. The person entitled to the compulsory portion can also claim a different value for the property in order to calculate the amount of their compulsory portion. However, the compulsory portion beneficiary then also bears the burden of proof for the assertion that the property has a higher market value than the actual sale price. Such proof can also be provided by obtaining an expert opinion during the proceedings.
Can the beneficiary of the compulsory portion demand a valuation by an expert even if the property in the estate has already been sold?
In the event that a property belonging to the estate was sold soon after the inheritance, case law usually bases the calculation of the compulsory portion on the actual sale price. However, this does not mean that the person entitled to a compulsory portion is not entitled to an expert's report. On the contrary, the person entitled to the compulsory portion can generally demand that the value of the property at the time of inheritance be determined by an expert. An expert's report enables the beneficiary of the compulsory portion to assess whether the sale price actually corresponds to the fair market value. Finally, the beneficiary of the compulsory portion can also claim a value other than the sale price and base their calculation on this. If the beneficiary of the compulsory portion had no claim against the heir for a valuation in the event of a sale, the beneficiary of the compulsory portion would bear the risk in the proceedings if he or she were to set too high a value without the appropriate expertise (see BGH, judgement of 29.09.2021 - IV ZR 328/20). Nevertheless, practical problems can arise when enforcing the right to a valuation if the property has already been sold and is owned by a third party. The legally obliged heir cannot force an inspection of the property by an expert if the new owners object to an inspection by an expert. It is true that the expert may then be able to make an assessment based on the external appearance and the paperwork. However, the informative value is then naturally lower and there is a risk that the purpose of the claim will be defeated, namely to give the beneficiary of the compulsory portion a better basis for making a decision on pursuing their claim.
Is the beneficiary of the compulsory portion entitled to a „publicly appointed and sworn expert“?
Particularly when it comes to determining the value of a property belonging to the estate, there is often concern that the heir could exert influence on the valuer or that the valuer is not exercising due care in determining the value for other reasons. In many cases, the beneficiary of the compulsory portion demands that the heir obtain a valuation report from a „publicly appointed and sworn expert“. However, there is no such entitlement. The qualification of the expert is not regulated in Section 2314 para. 1 sentence 2 clause 2 BGB. The only decisive factor is that the value of the estate is determined by an impartial expert, regardless of whether he or she is publicly appointed and sworn or not. The Federal Court of Justice has clearly ruled that the person entitled to a compulsory portion is not entitled to an expert opinion from a publicly appointed and sworn expert (BGH, judgement of 29 September 2021 - IV ZR 328/20).
Is a person entitled to a compulsory portion who has waived the inheritance also entitled to a valuation?
Not only those who have been disinherited by the testator are entitled to a compulsory portion. A person who has been designated as an heir but is burdened by the appointment of a subsequent heir, an executor of the will, a division order or a condition or legacy can also claim the compulsory portion if they waive the inheritance. In this respect, the question arises as to whether the person who has only acquired a claim to the compulsory portion by disclaiming the inheritance, as well as the person who was disinherited by the testator from the outset, has a claim to information and valuation. In any case, the Federal Court of Justice has clearly ruled on the right of the person entitled to a compulsory portion to information and submission of an estate inventory (BGH judgement of 30 November 2022 - IV ZR 60/22). The guiding principle of the decision states: „A person entitled to a compulsory portion is entitled to information pursuant to Section 2314 (1) BGB even after waiving their inheritance pursuant to Section 2306 (1) BGB.“ The fact that the BGH mentions the entire section 2314 para. 1 BGB in its decision, i.e. not just the claim to information and submission of an estate inventory pursuant to section 2314 para. 1 sentence 1 BGB, indicates that the decision also refers to the claim to a valuation pursuant to section 2314 para. 1 sentence 2 alt. 2 BGB.
When does the valuation claim expire?
Pursuant to Section 195 of the German Civil Code (BGB), the right to a compulsory portion lapses after three years. The period begins at the end of the calendar year in which the claim to the compulsory portion arose and the person entitled to the compulsory portion became aware of the circumstances giving rise to the claim and of the person of the debtor or should have become aware of them without gross negligence (Section 199 (1) BGB).
The three-year limitation period also applies to claims for the provision of information and valuation in accordance with Section 2314 (1) BGB.
The various claims, i.e. the claim to payment of the compulsory portion, the claim to the provision of information, the claim to the submission of a (notarised) inventory of the estate and the claim to a valuation, must be distinguished from one another. These are different claims that can be asserted individually or jointly or in stages. This distinction can lead to problems in particular if the limitation period for the claims is to be suspended, e.g. by bringing an action or if the parties agree to waive the defence of limitation. An action for information, for example, does not suspend the limitation period for the claim for payment. On the other hand, according to the prevailing opinion in case law and literature, information pursuant to § 2314 para. 1 sentence 1 BGB and a notarised list pursuant to § 2314 para. 1 sentence 3 BGB form a uniform claim of different degrees of strength, with the consequence that the action for information also interrupts the limitation period with regard to the claim for the preparation of a notarised list. According to a decision by the Munich Higher Regional Court, however, this should not apply to the claim for valuation pursuant to Section 2314 (1) sentence 2 Alt. 2 BGB. This constitutes an independent claim in addition to the right to information (OLG Munich, judgement of 8 March 2017 - 20 U 3806/16). There are reservations about the opinion of the Higher Regional Court of Munich because the person entitled to a compulsory portion can only be required to pursue the claim for valuation if they have first been informed that the item in question even belongs to the estate or that the item is listed in the estate register. Furthermore, in the opinion of the BGH, all claims pursuant to Section 2314 para. 1 BGB are non-genuine auxiliary claims that are intended to enable the person entitled to a compulsory portion to obtain the necessary knowledge to assess the claim to a compulsory portion (BGH, judgement of 30 November 2022 - IV ZR 60/22). Despite these reservations about the decision of the Munich Higher Regional Court, it should be remembered to include the valuation claims when bringing an action or agreeing to waive the defence of limitation.