Is the Compulsory Portion Still Appropriate Today?
Reform proposals offering greater justice in individual cases
Private Law Gazette 2/2021 – In Germany freedom of testation prevails. This notion flows from the principle of private autonomy: We can freely dispose of our property and therefore also determine by means of a will to whom our assets will pass in the event of death. The right to receive a compulsory portion sets limits on this power of disposal. The closest family members are entitled to a fixed share of the estate that they can claim against the heirs. "But is that appropriate in every case?", asks Institute Director Reinhard Zimmermann, who has for many years been researching historical and international developments in succession law.
Together with an international study group established by him, he has investigated how other countries regulate the protection of the closest family members in the law of succession. The result of this research has fed into a working group within the Institute, also set up by Reinhard Zimmermann which has drafted a concrete proposal suggesting the replacement of the right to a compulsory portion with a model based on the need for maintenance.
Fixed share for the closest family members
The idea of a “right to a compulsory portion” originated in Austrian law, where it was first implemented in the Allgemeines Bürgerliches Gesetzbuch (ABGB) of 1811. The German legislature adopted this concept in the Bürgerliches Gesetzbuch (BGB), which came into force in 1900. At the same time, it rejected the introduction of a “right of forced heirship” based on the model of the French Code civil of 1804.
Both the right to a compulsory portion and of forced heirship are mechanisms affording family members fixed-share participation in the estate of the deceased. But while in the one case a fixed share is reserved for them so that they become "heirs" in the sense of "fixed heirs", in the other case the closest family members receive only a claim under the law of obligations against the heir or heirs for a certain share of the estate. Under German law, this amounts to half of their intestate share of the estate, i.e., the share the family member would have received had there been no will.
The imperative of family solidarity
What values and expectations are associated with what is commonly referred to as the compulsory portion? “It is a matter of striking a balance between the principle of freedom of testation and the moral imperative of family solidarity”, says Reinhard Zimmermann. “Both are deeply anchored in our legal system. Testamentary freedom is protected by the Basic Law. The compulsory portion, in the opinion of the Federal Constitutional Court “extends the mutual duties of assistance and respect – principles generally shaping family life – into the law of succession.”
Compulsory portion versus maintenance
Accordingly, the participation of family members in the estate is to be derived from the legal position that existed during the lifetime of the testator. "This is indeed a correct perspective. Yet, it argues against rather than in favour of a compulsory portion", Zimmermann concludes: “For, after all, it is claims to maintenance and not claims to a compulsory share that exist during one's lifetime.”
Comprehensive comparative analysis
Over the course of a year, the nine-member working group within the Institute under Zimmermann’s leadership analysed the fairness of the right to a compulsory portion and considered all relevant problem areas. For historical and comparative orientation, all European legal systems were examined as well as those elsewhere around the world influenced by European law. What picture emerged from this inquiry?
The private law codes of Western Europe are all characterized by fixed share participation. In a number of post-socialist states in Central and Eastern Europe, by contrast, the right to a compulsory portion or forced heirship is based on a needs-based test. Children are entitled to a share only if they are minors or disabled; surviving spouses are protected by the marital property regime in a number of legal systems.
England, New Zealand, Australia, and the English-speaking provinces of Canada follow a “family provision” approach that is, in principle, needs-based. The position of surviving children is particularly unfavourable in 49 of the 50 states of the USA, where they are at best entitled to a “family allowance”. "Comparative legal discourse has thus far paid little attention to Central American codifications or to Mexico. In these jurisdictions dependents do not have a right to a compulsory share or forced heirship “but retain much more logically, their right to claim maintenance", Zimmermann says. "Similar rules can also be found in Quebec's Code civil and in the Roman-Dutch law of South Africa."
A proposal for the German legislature
Zimmermann's team has managed to develop an alternative to the right to a compulsory portion, a model which is instead linked to an individual’s need to receive maintenance. It is based on the idea that the closest family members of the deceased should, as closely as possible, receive after the testator’s death what they have received during his or her lifetime.
A forthcoming book authored by all the members of the working group and entitled "Zwingender Angehörigenschutz im Erbrecht: Ein Reformvorschlag" (Mandatory Family Protection in the Law of Succession: A Reform Proposal) will present concrete legislative proposals for the reform of the relevant provisions of the BGB. "In view of the reforms of the law of succession that have taken place in the Netherlands, France, Belgium, and Austria over the past decades, it is time for Germany to replace its rigid compulsory portion scheme with a more flexible and thus more modern form of protecting close family members", says Zimmermann, summarizing the focus of the project. An overview of the project and its background is also provided in an article by Reinhard Zimmermann which will appear in the Archiv für die civilistische Praxis (AcP) at the start of next year.