What is a legacy?
Through a legacy, the testator can bequeath a specific object to a person without directly appointing them as an heir. The beneficiary is the so-called legatee.
A legacy can only be ordered by way of a testamentary disposition upon death.
What can be the subject of a legacy?
The subject of a legacy can be anything.
Examples of legacies are
- A certain amount of money
- Jewellery
- Usufructuary right
- Real estate
What types of legacy are there?
1. Individual legacy
In the case of an individual legacy, the legatee only receives a specific item from the estate assets.
2. Substitute legacy
Pursuant to Section 2190 BGB, the testator may assign the object of the legacy to another person in the event that the initial beneficiary does not acquire the legacy.
3. Subsequent legacy
If the testator has bequeathed the bequeathed object to a third party from a specific point in time or event occurring after the bequest has been made in accordance with Section 2191 (1), the first legatee shall be deemed to be burdened.
Once the specified time or event has occurred, the object of the legacy shall pass to the legatee.
4. Legacy of Procurement
In the case of a bequest within the meaning of Section 2170 BGB, the testator grants the legatee an object that is not part of the inheritance.
5. Universal legacy
In the case of a universal legacy, the testator assigns the entire estate remaining after settlement of the estate liabilities to the legatee.
6. Election legacy
In the case of an elective bequest pursuant to Section 2154 BGB, the beneficiary should only receive one or the other of several items.
Example:
My neighbour B may choose any item from my house inventory.
7. Generic legacy
If the testator has specified the bequeathed object only in terms of its type in accordance with Section 2155 (1) BGB, an object corresponding to the circumstances of the beneficiary must be provided.
Example:
I bequeath one of my records from my large record collection to my neighbour B.
8. Purpose-related legacy
Pursuant to Section 2156 of the German Civil Code (BGB), the testator may leave the determination of the benefit to the reasonable discretion of the beneficiary or a third party when ordering a legacy whose purpose he has determined. There must be sufficient indications for the selection of the object of the bequest.
One example of this is the facilitation of training or studies.
9. Advance legacy
An advance legacy within the meaning of Section 2150 BGB is a legacy granted to an heir. The legacy granted to the heir is intended to accrue in addition to his or her inheritance share.
What are the arguments in favour of a legacy and against leaving an inheritance?
There are many different reasons for making a bequest. One reason may be that the testator wishes to leave a specific item to a specific person. In addition, the creation of an unwanted community of heirs can be prevented by making a bequest.
In addition, a bequest pursuant to Section 2151 (1) of the German Civil Code (BGB) allows the testator to stipulate that several persons are to receive a bequest in such a way that the beneficiary or a third party determines which of the several persons is to receive the bequest.
For example, the latter can be used in relation to the regulation of a company succession, so that the claimant or a third party should select the most suitable person for the company succession.
What is the difference between a legacy and an inheritance?
It is often difficult to distinguish whether someone has been appointed as an heir or whether a legacy has merely been ordered. It is particularly difficult to determine if larger assets have been bequeathed.
In case of doubt, it must be determined by interpretation whether a strong position of the testator in the estate is desired (appointment as heir), or whether only a claim to a certain object is to be granted.
The law has created important aids to interpretation in order to make a distinction. Pursuant to Section 2087 (1) of the German Civil Code (BGB), the disposition is to be regarded as the appointment of an heir if the testator has granted his assets or a fraction of his assets to the beneficiary, even if the beneficiary is not designated as an heir. Pursuant to Section 2087 (2) BGB, in case of doubt it is not to be assumed that the beneficiary is to be an heir if only individual items are given to him/her.
What does a legatee have to do?
If someone has been appointed as a legatee, it must be ensured that this only establishes a claim to the legacy granted against the community of heirs.
The debtors are the co-heirs, who are jointly and severally liable unless otherwise stipulated by the testator. The legatee can assert their claim regardless of whether the community of heirs has been triggered.
If there are difficulties in enforcing his or her legacy claim against the heir, he or she can, if necessary, bring an action. However, this can only be filed after the six-week deadline for the waiver or after acceptance of the inheritance.
As a legatee, you also have the option of making an informal declaration of renunciation to the beneficiary.
Conclusion on the legacy
A legacy is a flexible instrument in a will that allows a specific person to bequeath a particular item or sum of money without appointing them as an heir. The legatee does not receive a share of the entire estate, but rather a claim against the heir(s) for the fulfillment of the legacy. Especially in cases involving substantial assets or multiple parties, careful interpretation is crucial to clearly distinguish a legacy from an inheritance.
Whether it's a specific bequest, a legacy in advance, or a special arrangement for business succession – every scenario should be legally reviewed. Potential effects on the compulsory share or on other beneficiaries of the estate must also be considered. An example of this is the bequest of specific items or donations to charitable organizations, which are intended to be made specifically outside the inheritance quota.
Since enforcing a claim against an heir can be a source of conflict in practice, it is advisable to seek sound advice early on. This ensures that the legacy is effectively structured and can actually be implemented in the specific case.