Bank accounts in estates often raise a number of questions in practice. In particular, the question of access to the money, the distribution and the necessary proof to the bank is relevant.
Who is entitled to the money in the bank account?
Like other assets, the credit balance in the bank account is an integral part of the estate assets. Therefore, upon the death of the testator, the estate assets automatically pass to the community of heirs in accordance with the principles of universal succession. Who exactly inherits the assets is decided either by testamentary dispositions or by statutory provisions. If there are any uncertainties in individual cases as to who is an heir or who inherits to what extent, such conflicts must be resolved in inheritance proceedings.
In some cases, the testator transfers financial assets in the form of a legacy. In contrast to an heir, the legatee only has a claim to the legacy. As a rule, the legatee must assert their claim against the community of heirs.
What evidence does the bank need?
Difficulties often arise with banks during the process. In practice, banks very often demand the presentation of a certificate of inheritance almost as a reflex. Applying for a certificate of inheritance or initiating inheritance certificate proceedings can be an expensive and time-consuming endeavour, which is why it is advisable to carefully check whether a certificate of inheritance is actually necessary. As a rule, the presentation of the will opened by the probate court will suffice, regardless of whether the will is a notarised or handwritten will.
However, if there is no testamentary disposition, the bank will insist on a certificate of inheritance.
How is the bank balance distributed among the community of heirs?
A community of heirs exists if there are several heirs. It should be noted that as long as the community of heirs exists, the co-heirs only dispose of the estate assets jointly. In principle, the heirs can decide at their own discretion how they wish to divide and disburse the financial assets, provided that all co-heirs make the same decisions.
With regard to the bank account, it is important to note that a co-heir is not entitled to a share of the assets corresponding to their inheritance share. Although there is the option of claiming and enforcing the division of the community of heirs in court, in practice this is often an extremely complicated and time-consuming endeavour. It is therefore advisable to work out a uniform agreement with the other co-heirs in order to avoid long-standing disputes.
What happens to the joint account?
Couples who run their household together often keep a joint account in the form of a so-called „Oder account“, where each individual account holder is authorised to dispose of the credit balance independently. As a rule, few problems arise if the other account holder is the sole heir or has been appointed sole heir by, for example, a Berlin will.
Difficulties can again arise if other co-heirs take over as new account holders as part of the legal or testamentary succession. A particularly relevant case in practice is where the surviving account holder of the joint account continues to make disposals and withdrawals without coordinating them with the community of heirs. It is important to note here that the initial freedom of action of a joint account does not mean that the surviving partner is later not obliged to grant compensation to the community of heirs.
If, for example, there are compulsory portion beneficiaries, it must be clarified in the specific case to what extent the account balance has an influence on the compulsory portion.
Corresponding instructions from the spouses in the form of a will are rare in practice. It is therefore generally advisable to write down appropriate provisions in a will at an early stage.
What is the difference between a joint account and a simple bank authorisation for the spouse's account?
The most commonly used type of joint account in practice is the Oder account. Here, the two account holders are each authorised to dispose of the assets alone.
However, this must be distinguished from the case where the other spouse has only been given power of attorney over the account and the account therefore only belongs to one spouse. Persons with such a power of attorney do not necessarily have to be the same persons as the deceased's heirs.
In the event of death, however, it is important to identify what type of power of attorney has been granted. A distinction must be made here as to whether it is a power of attorney that only extends until death, a power of attorney from death or a power of attorney that is intended to extend beyond death. The latter is the type of power of attorney most frequently used in banking practice.
Immediately after the death of the testator, the heirs take over the position of account holder as legal successors. At the same time, the authorised representative retains unrestricted power of disposal over the account.
In this case, however, the position of the community of heirs is significantly weakened by the power of attorney, as they only gain access to the bank account when they present a certificate of inheritance or the bank's opening protocol. Until the heirs have the relevant documents, the holder of the power of attorney can dispose of the account contents without restriction.
In practice, it is becoming increasingly common for the authorised representative to empty the accounts after the inheritance has taken place. As a result, the heirs often only find empty accounts once they have received the necessary documents.
In this context, it is important to emphasise that a power of attorney does not provide any legal basis for retaining someone else's money. Although the authorised representative has the legal authority to dispose of another person's account, this does not include any information as to whether the authorised representative is entitled to keep the deceased's money.
Is the bank obliged to check the authorisation?
If the authorised representative has emptied accounts, the question understandably arises as to whether the bank has done everything in accordance with its duties or whether it should at least have checked the existence of the power of attorney submitted.
Overall, it is generally decided that the bank must even follow the instructions of the authorised representative if there are no clear indications of a misuse of power of attorney.
Any claims for damages against the bank are therefore only conceivable if there are corresponding indications.
Can you pay for the funeral from the balance in the bank account?
As a rule, the funeral costs must be paid promptly. Many relatives cannot cope with this financial burden without help. In fact, it is possible to pay the funeral costs from the account of the deceased. Neither a power of attorney nor a certificate of inheritance or other proof of inheritance is required for this.
The prerequisite is that the deceased's account has sufficient funds and the relatives must submit the invoices to the bank. When submitting the documents, it will be necessary to sign a „declaration of liability for the settlement of the estate“, which the bank uses to secure itself. The bank will then pay the bills for the funeral.