How to Renounce the Role as Executor in Germany

If someone who owns assets in Germany dies, these foreign assets will only be released if a German (!) Grant of Probate can be presented. Since the UK has opted out of the EU Succession Regulation, an English Grant of Probate (or Scottish Confirmation) is worthless abroad, just as British financial institutions do not accept non-UK Grants. Thus, in principle, a national Grant of Probate must be obtained in each and every jurisdiction, where the testator held assets.

In Germany, the executors and beneficiaries have a choice between applying for a Certificate of Inheritance (Erbschein) or a Certificate of Executorship (Testamentsvollstreckerzeugnis). Details of which are explained here.

Depending on how the relevant Will is worded, one or the other may be the smarter choice. If there is an English Will, then the easier way is usually the Certificate of Executorship, because English Wills are, in most cases, very precise about who the executors are. However, most Wills name more than one executor. Sometimes the wording even is

“I appoint the partners at the date of my death in the firm of Solicitors XYZ to be the Executors…”

This can be a large number of people who would all have to apply jointly and would later on also have to act jointly. This, of course, is impracticable and the normal approach in cases like this one is for all but one or two of those people to refuse to act as executor. Under German law, this can be done by a simple letter to the German Probate Registry in charge (usually the Probate Court where the deceased has had his or her last residency, if resident outside of Germany then it is usually the Local Court Berlin).

An example for such a simple letter of renunciation of executorship is available for download here: Renunciation_Executorship_Template

The document does not necessarily have to be witnessed and, since there are no strict formal requirements (in contrast to the application for a certificate) it can even be sent to German Probate Registry by way of facsimile.

For more information on German-British will preparation and probate matters please see these posts provided by the international succession laws experts of Graf & Partners LLP

Or simply click on the “German Probate” section in the right column of this blog.

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The law firm Graf & Partners and its German-English litigation department GP Chambers was established in 2003 and has many years of experience with British-German and US-German probate matters, including the representation of clients in contentious probate matters. If you wish us to advise or represent you in a German or cross border inheritance case please contact German solicitor Bernhard Schmeilzl, LL.M. (Leicester) at +49 941 463 7070

Corresponding with Germans: How not to come across as being rude

Proper Email Etiquette when corresponding with Business Partners in Germany, Austria or Switzerland

Our law firm specialises in British-German legal issues, so most of our email correspondence takes place in English. In many cases, we represent German business clients for whom we liaise with UK business partners, barristers, solicitors, tax advisors, or other consultants.

Rule 1: Do not address people by their first name right away

German clients, especially if they do not have any prior experience with Anglo-American business partners, are often shocked, when the UK (or US) counterpart responds using the German client’s first name. This is sometimes considered as too intimate or even rude. Especially, if the British business partner uses only the first name – and nothing else, which is rather common in Britain and the USA.

However, to a German, an email starting with “Bernhard, could you give me a call …” sounds very much like “Bernhard, you have messed up and I need to straighten you out”. Virtually no German would write to another German by just using his first name. Even if they are on a first name basis, they will always use “Hello Bernhard” or “Hi Bernhard” or even just “Hello” or “Good morning”. Again, using only the first name without any salutation will ring alarm bells with the German recipient and it will remind him of when his mother used to yell “Bernhard, how often do I have to tell you to clean up your room”.

My recommendation: Use “Hello Bernhard” or “Hi Bernhard” or “Good morning Bernhard”. When in doubt about whether your German counterpart is old fashioned and/or unaccustomed to the Anglo-American habit of using first names even in business correspondence, use “Mr” or “Mrs”.

By the way: I personally would stay away from addressing a German with “Hello Herr Schmidt” or “Dear Herr Schmidt”. Surely, most British and US partners who use this “Herr” (or “Frau”) mean well and just intend to “do as the Germans do”. However, there is always the risk that the German recipient of such an email may take this the wrong way and feel ridiculed. When I do get such emails adressing me with “Hello Herr Schmeilzl” it always conjures up the image of John Cleese doing the Fawlty Tower Nazi Walk On the other hand side, maybe it’s just me  :-)

Rule 2: Don’t hesitate to use “Dear”

The standard German salutation in a letter to someone you are not on a first name basis with is “Sehr geehrter Herr Schulz”, which literally translates into “Much esteemed Mr Schulz”. In German, it does not sound that old fashioned and stiff, it is simply the standard greeting one uses. In order to use “Lieber Herr Schulz” (Dear Mr Schulz), one must really have a very good personal rapport with the addressee. Thus, the combination of “Lieber” and “Herr” is rare, because if I can use “Lieber” then I am usually already on a first name basis with that person.

Now, since there is no practical English language equivalent to the German “Sehr geehrter”, you have the choice between “Hello”, “Hi” or “Dear”. To a German, the English “Dear” does not have the same intimate sound as the German “Lieber” has, so feel free and go ahead using “Dear Mr Schulz”, even if you would not use it to adress an English speaking business partner. Using “Sir” in the first ever letter or email to someone is fine, but it will sound stand offish and very formal if you keep using it.

German lawyers (Rechtsanwälte), by the way, do greet each other with “Sehr geehrter Herr Kollege Soandso”, i.e. “Well esteemed colleague Mr Soandso”. Leaving out the “Kollege” will be considered as impolite.

Rule 3: Explain

Finally, my advice is to get the matter out in the open and simply explain to the German recipient what you are doing. An introductory sentence like this one, for example, will mostly do the trick: “Dear Bernhard, I hope it is ok to address you on a first name basis as we do here in Britain…”. Very rarely, a German will then still insist on being formally adressed as Mr Soandso. Instead, in most cases, the German recipient will be flattered and happy to have “hit it off so well” with his British counterpart to even be called by his first name already.

As always, there are exceptions to these rules. Especially since the younger generation is much more international nowadays and many young Germans will be well aware of the fact that Britains and Americans do address each other with their first names without this meaning that they are best pals.

While Germans and Austrians are quite similar in their approach to business correspondence etiquette (or netiquette), the average Swiss will be much more conservative and traditional. So I suggest to stick with Mr and Mrs if you write to a Swiss person until he or she makes the first move re the first name issue.

Good luck with your British-German business correspondence! And if anything goes wrong after all, you can always call a Cross Channel Lawyer :-)

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The law firm Graf & Partners and its German-English litigation department GP Chambers was established in 2003 and has many years of experience with British-German and US-German probate matters, including the representation of clients in contentious probate matters. If you wish us to advise or represent you in a German or cross border inheritance case please contact German solicitor Bernhard Schmeilzl, LL.M. (Leicester) at +49 941 785 30 53.

Expert Reports on German Law

As a full service German and English law firm, established in 2003, we are often asked to provide English Law Firms with an expert report based on issues of German Law.

Bernhard Schmeilzl, a bilingual Lawyer, is qualified and is able to provide expert reports to be used in English litigation and arbitration cases based on various issues of German law, whether it be Civil, Commercial or Criminal law, including procedural aspects . Not only does he have a very good grasp of the English Civil Procedure Rules on expert reports, but he also has a vast experience of working closely with Solicitors and Barristers within England. Bernhard has prepared reports for all types of law firms in England, from Magic Circle firms to regional firms, including the following areas:

  • Corporate and commercial law disputes between British and German businesses;
  • Contentious probate matters around the validity of German wills;
  • Accidents involving British citizens in Germany (personal injury); and
  • Medical malpractice cases involving German GP’s and hospitals

Do you need an expert report from a German Solicitor? Then please do not hesitate to contact us on +49 (0) 941 7853053 or mail@grafpartner.com

Careful with Deed of Variation if Estate comprises Foreign Assets

Using a Deed of Variation in the UK may cause additional Taxes Abroad

Let’s take an easy example: An English testator owns property or a significant investment in Germany, which already triggers German inheritance tax, even if neither the legator nor the beneficiaries are resident in Germany. He has two children and gives the German house (or flat) to child 1, the German investment to child 2. For whatever reasons, the children prefer a different distribution of these assets and thus agree to use a Deed of Variation. From an English law perspective: no problem. From a German tax law perspective: potential financial mayhem for the English beneficiaries. Why?

The German principle of universal, direct and immediate accession of the estate (Generalsukzession, Vonselbsterwerb) means that the beneficiaries (Erben) automatically acquire the estate (or their share of the estate) literally in the second the legator dies. There is no administration persiod, no personal representative etc. From a German inheritance tax perspective this means that it is clear in the second of death of the legator, what the beneficiary has inherited and what the German IHT debt is. This tax situation cannot be changed later on by a deed of variation. This legal instrument is unknown to German law.

The beneficiaries are, of course, free to agree amongst themselves that they wish to distribute the assets differently. However, this is a separate transaction, a second taxable event under German law.

Looking at the above example this means that the German tax office will first levy tax on the situation as it presentated itself from the black letter wording of the Will, i.e. child 1 needs to pay German inheritance tax on the value of the property, child 2 on the value of the investment. The Deed of Variation now is a second, separate taxable event, which can trigger German gift tax (if the house and the investment have different values) and also German property acquisition tax (Grunderwerbsteuer).

Also, there is a risk that the German tax office will not fully recognise the right to apply for unilateral relief (section 23 ErbStG) anymore, which is normally available in cases where UK IHT has already been paid on assets which are also relevant for German IHT.

The details are horribly complicated. Whether actual taxes become due depends on a number of factors, including domicile and residence of everyone involved, nationality, nature of the investment and the relationship between legator and beneficiary as well as between the beneficiaries, because German inheritance tax law allows for personal allowances. These IHT allowances (Steuerfreibeträge) differ hugely (from EUR 20k to EUR 725k), depending on degree of kinship.

The situation is even more complex, if either the legator or any beneficiary had or has a residence in Germany, even if it is just a holiday flat. Because this qualifies the beneficiary as a “Steuerinländer” (tax resident) which means that German IHT applies to either the entire estate (if the UK legator had a German residence) or to all assets the beneficiary with residence in Germany receives, even if these assets are outside of Germany (for details see the posts on German interitance and gift tax listed below).

In summary: If foreign assets are part of an estate, probate lawyers must be extremely cautious and evaluate the inheritance taxes in all countries concerned, before they recommend a deed of variation to be used. Any property swap and any disproportionate distribution of cash or other assets can trigger unexpected additional taxes in some jurisdictions.

For more information on German-British will preparation and probate matters please see these posts provided by the international succession laws experts of Graf & Partners LLP

Or simply click on the “German Probate” section in the right column of this blog.

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The law firm Graf & Partners and its German-English litigation department GP Chambers was established in 2003 and has many years of experience with British-German and US-German probate matters, including the representation of clients in contentious probate matters. If you wish us to advise or represent you in a German or cross border inheritance case please contact German solicitor Bernhard Schmeilzl, LL.M. (Leicester) at +49 941 785 30 53

Compensation for a wrecked Car under the German Law of Torts

Car Accidents: How are Damages calculated under German Law?

Each year, German police registers 2.2 million traffic accidents (for official 2016 stats see here). German insurers, lawyers and Courts are thus constantly faced with the question how to calculate damage claims after a car accident has occured.

If the car can still be repaired, the matter is fairly simple. The Defendant must pay for the costs for a state of the art repair plus the so called “merkantilen Minderwert”, i.e. the reduction in market value due to the fact that the car has been involved in an accident, even if the car has been repaired.

What if the car is beyond repair or the costs would be unreasonably high?

The general principle under German law is that in case of a “write off” (Totalschaden, i.e. if economically it makes no sense to repair the car), then the Claimant is entitled to the so called “Wiederbeschaffungswert”, i.e. the amount necessary to purchase a substitute car with identical value of the damaged car, minus what the Claimant may have received as scrap value payment for the damaged car (if anything). Mostly, experts and lawyers refer to the so called “Schwacke Liste“, a German company which since 1957 publishes lists with the current market value of virtually every car out there. This being used as a first point of reference. The individual condition of the car before it was damaged is then taken into account.

In addition to that “Wiederbeschaffungswert” (replacement purchase value), the Claimant can (only) demand interim car hire costs for a reasonable period, i.e. for the time which the Claimant needs to look for a suitable replacement car and purchase it.

More on civil litigation and evidence rules in German Courts of law and before German arbitration tribunals:

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The law firm Graf & Partners was established in 2003 and has many years of experience with British-German and US-German legal matters.The Anglo-German litigation lawyer team of GP Chambers is well equipped to advise and represent clients from the UK and other English speaking countries. If you wish us to advise or represent you in a German or cross border case, or if you need an expert report on German law, please contact German lawyer Bernhard Schmeilzl, LL.M. (Leicester), managing partner and head of the litigation department. Bernhard is also frequently asked by British and US Courts and Tribunals or by legal counsels to provide expert reports and legal opinions on German law.

German Law of Torts: Are Accident Victims entitled to a New House?

Can a disabled injured person claim for the predicted cost of accommodation or only the actual costs after they have been incurred?

Under German law, a person who is impaired by an accident is entitled to adequate housing. The extent and amount necessary for adequate housing depends on what an impaired person would reasonably require. This can be determined by an expert, who will be appointed by a German court.

However, a difficult and strongly debated question under German law of torts is whether the injured person may only claim compensation for costs he or she has actually incurred (reimbursement approach) or whether the injured person is entitled to request a lump sum payment for necessary measures, even if actual costs have not (yet) been incurred, based on sec. 843 (3) German Civil Code (for details see German Supreme Court ruling of 19 May 1981, published in NJW 1982, p. 575; also see Münchner Kommentar zum BGB, Band 5, Auflage 6, § 842, Rd. 66 and Rd. 77).

Those in favour of the “lump sum approach” argue that German law does accept the concept of so called “fiktive Pflegekosten” (fictitious costs for home help), i.e. the market value of such home help (usually between EUR 7 and EUR 10 per hour, depending on the cost of living in the area where the Claimant lives) must be paid by the injurer regardless of whether the injured person actually hires paid help or whether a relative or friend provides such help without remuneration. Thus, costs which are objectively necessary for modifying an existing or buying another house must also be compensated by the wrongdoer, regardless of whether and when the impaired person actually incurs these costs.

The mainstream opinion amongst German litigation lawyers seems to be, however, that under German law, notional costs cannot be claimed. Consequently, a Claimant can only request reimbursement of the amounts he or she has actually spent on housing (repair, modification, new purchase etc). This view is supported by legal literature (e.g. Gerhard Küppersbusch “Ersatzansprüche bei Personenschaden” [“Claims in the case of personal injury”] 10th edition 2010) as well as by case law (Higher Regional Court Hamm, ruling published in VersR 2003, 780).

So, what actual costs can an impaired person claim under German law of torts? Here are some examples:

  • If a new apartment is rented, which better suits the individual’s needs, then the additional rental costs must be reimbursed. It may get difficult, however, if this new apartment has additional advantages (e.g. more rooms for other family members). Then, there may be a reduction.
  • In case an existing house is remodelled to meet the special requirements of an impaired person, the reasonable and adequate remodelling costs must be reimbursed. The above re-additional advantages does apply here as well: modification of a house or flat usually leads to an increased value of the same, which then again must be set off (this was also discussed in the Supreme Court ruling of 1981)
  • In case a new house is built or another house is bought, a German court would verify whether the impaired person has obeyed his duty to keep the damage at a minimum (obligation to mitigate losses), i.e. if it would have been less cost-intensive to rent an adequate house, especially since leasing an apartment or even a house is much more common in Germany than it is in the UK. However, even if the Court is convinced that buying or building another house was necessary, then it is very difficult to calculate the exact amount which must be compensated by the injurer, because this new house will often have a higher value. This extra value of the new house compared to the previous house is not recoverable and must be deducted from the claim. Thus, one must differentiate between the increase of value and the necessary and reasonable costs caused by the accident. These are difficult issues which usually involve a number of experts.

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The law firm Graf & Partners was established in 2003 and has many years of experience with British-German and US-German legal matters.The Anglo-German litigation lawyer team of GP Chambers is well equipped to advise and represent clients from the UK and other English speaking countries. If you wish us to advise or represent you in a German or cross border case, or if you need an expert report on German law, please contact German lawyer Bernhard Schmeilzl, LL.M. (Leicester), managing partner and head of the litigation department. Bernhard is also frequently asked by British and US Courts and Tribunals or by legal counsels to provide expert reports and legal opinions on German law.

A German Claimant can’t be his own Witness

Litigation Practice in German Court Rooms differs hugely from English Civil Procedure

Under the English Civil Procedure Rules, it is common practice that a Claimant provides a witness statement to the court. To the eyes of German lawyers and Judges, this is a strange concept, because German law does not allow parties to provide witness statements as evidence before the Court.

Under section 447 German Civil Procedure Rules (CPR), a party (Claimant or Defendant) may only provide evidence by her / his own personal statement of facts, if the other party expressly consents to such “Parteivernehmung” (evidence by party statement). Obviously, such permission is usually not granted. Thus, in a German Court room, a party is not able to give “hard evidence” by giving a statement in his/her own words. German law simply does not trust such party statements to be objective and accurate.

German Claimants and Defendants may, of course, present their side of the story and the German Civil Courts will take such statements by the parties into due consideration, but they will not be considered as hard evidence, see section 453 Civil Procedure Rules (CPR):

Evaluation of the evidence obtained in examining a party

(1) The court is to evaluate, at its discretion and conviction, the testimony of the party pursuant to section 286.

The general principle regarding evaluation of evidence is contained in section 286 German Civil Procedure Code (CPR):

Evaluation of evidence at the court’s discretion and conviction

(1) The court is to decide, at its discretion and conviction, and taking account of the entire content of the hearings and the results obtained by evidence being taken, if any, whether an allegation as to fact is to be deemed true or untrue. The judgment is to set out the reasons informing the conviction of the judges.

(2) The court shall be bound to statutory rules of evidence only in the cases designated in the present Code.

Section 448 allows the German Civil Court to formally examine a party directly:

Section 448 Ex officio examination

Even if no petition has been filed by a party, and without consideration of the onus of proof, the court may direct that a party or both of the parties be examined regarding the facts and circumstances at issue, if the results of the hearings and of the taking of evidence, if any, do not suffice to establish to the satisfaction of the court the truth or untruth of a fact or circumstance that is to be proven.

This is, however, not often done and is meant as a means of last resort.

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Thus, under German procedural law, party statements are not considered “hard evidence”, but are instead qualified as mere “Parteivortrag”. If the other party disputes such Parteivortrag, then the party bearing the burden of proof for this issue will lose the case unless the party can present hard evidence. In other words: Parteivortrag per se is not enough, even if the judge believes the Parteivortrag is true. Without hard evidence in the form of documents or real witnesses the Claimant will have not made their case under German Civil Procedure Rules.

In addition, even expert reports, if submitted by a party, are not considered real evidence, but only constitute so called “qualifizierter Parteivortrag” (qualified party statement). In order for an expert report to be taken seriously under the German Civil Procedure Rules, the expert must have been chosen and appointed by the Court. This is a very different approach compared to civil litigation in England.

When our German litigation lawyers represent English or American Claimants in German Courts, these clients and their foreign legal counsel usually have a very hard time understanding that we do not ask the Client to submit a written Witness Statement and that we also do not recommend to get an expert opinion straight away. The reason is, as explained above, that under German Civil Procedure Rules, witness statements are not being submitted in written form anyway (much less the statement of a party), because the judge questions the witnesses during the oral hearing. If a legal counsel approaches a witnesses at any time before the court hearing, this may be seen as trying to influence the witness. So, any “preparation” or “coaching” of a witness, is at best useless, and at worst it will be considered as attempting undue influence by a party, which may render the testimony of the witness worthless.

In regards to experts (Gutachter or Sachverständige), it may in some cases be necessary to get a pre-trial expert report in order to get a better understanding of some facts (for example medical or technical issues). However, while such a pre-trial expert opinion (Privatgutachten) may of course be submitted to the German Court, the Claimant and Defendant must always be aware of the fact that such a “privately obtained expert report” is not hard evidence under the German Civil Procedure Rules. The expert’s findings will, in most cases, not be accepted by the other party and in that instance, the Court must and will select and instruct a neutral expert in order to provide a report directly to the Court. So, from a perspective of trial strategy, if in a certain technical area there are not many experts available, it may be unwise to obtain a pre-trial report from such expert, because he or she will then be “burned”, i.e. cannot be chosen by the Court anymore.

After all of the above, it is rather surprising that a party’s legal counsel (the Rechtsanwalt, i.e. the German barrister) is permitted to act as a witness for his / her client. If, for example, at any time during pre-trial negotiations, the Defendant (let’s say in a meeting or a phone conversation) has admitted to some fact which helps the Claimants case, the Claimant’s counsel may give a witness statement about this, which is then considered hard evidence. It does not happen very often that a German litigator stands up and gives a formal witness statement for the benefit of his client. And if it does, all the lawyers look at each other as if they feel that something must not be quite right. However, the German Supreme Court (Bundesgerichtshof) has ruled that a German lawyer is permitted to act as a witness for his own client,  Court Order of 8.5.2007 – VI ZB 80/06 (for details see here).

More on civil litigation and evidence rules in German Courts of law and before German arbitration tribunals:

– Making a Court Claim for Money in Germany: It’s actually quite easy

– How expensive is a German Lawsuit?

– German Litigation Experts explain Civil Procedure Rules

– Standard of Proof in German Civil Litigation

– Does German Law of Torts know the Egg Shell Skull Rule?

– If you are bitten by a Dog in Germany

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The law firm Graf & Partners was established in 2003 and has many years of experience with British-German and US-German legal matters.The Anglo-German litigation lawyer team of GP Chambers is well equipped to advise and represent clients from the UK and other English speaking countries. If you wish us to advise or represent you in a German or cross border case, or if you need an expert report on German law, please contact German lawyer Bernhard Schmeilzl, LL.M. (Leicester), managing partner and head of the litigation department. Bernhard is also frequently asked by British and US Courts and Tribunals or by legal counsels to provide expert reports and legal opinions on German law.

Are Foreign Wills valid in the United Kingdom?

To be valid, a Will must bear the signature of two witnesses, right? Well, in principle yes. Section 9 of the Wills Act 1837 (as amended) provides that a Will shall not be valid unless: (a) it is in writing and signed by the testator, or by some other person in his presence and by his direction; (b) it appears that the testator intended by his signature to give effect to the will; and (c) the signature is made or acknowledged by the testator in the presence of two or more witnesses present at the same time; and (d) each witness either: (i) attests and signs the will; or (ii) acknowledges his signature, in the presence of the testator (but not necessarily in the presence of the other witness), but no form of attestation shall be necessary.

However!

If the testator has failed to satisfy section 9 of the Wills Act 1837, the Will may still be saved by coming within the terms of section 1 of the Wills Act 1963:

Formal Validity of a Will: A will shall be treated as properly executed if its execution conformed to the internal law in force in the territory where it was executed, or in the territory where, at the time of its execution or of the testator’s death, he was domiciled or had his habitual residence, or in a state of which, at either of those times, he was a national.

Thus, if, for instance, a German national living in England writes a German style Will, i.e. a hand written (holographic) “eigenhändiges Testament” without involving any witnesses, said Will is still accepted as being valid both in England and in Germany, because German law has corresponding legislation in place which deals with the formal validity of foreign Wills. Note: Since August 2015 these matters are dealt with by the EU Succession Regulation (EU Nr. 650/2012), which – however – the UK has opted out of. Continue reading

Why are German Contracts so short?

To the eyes of an English or a US contract lawyer, agreements drafted under German law appear shockingly short. This is not due to German contract lawyers being more lazy than their Anglo-American colleagues. Instead, the reason is the concept of Codification. Virtually all legal principles of German private and commercial law are laid down in statute books, most importantly the German Civil Code (Bürgerliches Gesetzbuch, BGB), the Commercial Code (Handelsgesetzbuch, HGB), the Code on Limited Liability Companies (GmbH Gesetz) and the Code on German Stock Corporations (Aktiengesetz). A large number of these statute books are even available in an English translation on the official government website www.gesetze-im-internet.de (German Laws & Statutes Online).

Codification means that the legislator provides the basic structures of an area of law. Now, Germans being Germans, the German legislator did not merely stick to basic principles, but has, in many areas of German law, set out very detailed rules, especially when it comes to consumer protection laws. Thus, if a German landlord leases an apartment to a German tenant, for example, nothing other needs to be agreed than the monthly lease amount and the beginning of the lease period. Virtually everything else is regulated by the relevant section of the German Civil Code (§ 535 to § 580a BGB). The same is true for most other contract types. That is why German contracts are so short and appear to be “unprofessionally drafted”. Well, sometimes they are, but briefness is usually not the problem.

The parties, within certain limits, are allowed to steer away from the default regimes of the various German contract types. However, this is exactly, where problems often are created. Especially if a foreign lawyer uses non-German templates, which contain terminology and legal concepts strange to German codified law. This happens all the time in Anglo-German business transactions. If the parties are later in dispute about what a certain clause or term shall mean, that is when they realise that German lawyers had a completely different understanding than their British or American colleagues all along. Classic issues, for example, are the meaning of the legal term “guarantee” or the concept of “indemnification”, which is rather strange to a German lawyer.

In a jurisdiction which uses Codification (Germany, France, Netherlands etc), legislation contains general principles and guidelines and defines the terminology used. Specific statutes lay down rules for individual types of contracts, such as contracts of sale, lease, loan and many others. Most importantly, German law provides general catch-all provisions that apply where the parties have not explicitly agreed otherwise. Thus, when drafting a contract, one should stay away from mixing up legal terminology from different jurisdictions. However, in my experience as an international contract lawyer, this is being done all the time, because inhouse and outhouse legal counsels from different countries want to get their standard boilerplate clauses in, which is a rather dangerous approach, because contradicting language will make it very difficult for a judge or arbitrater later on, to interpret the agreement. Instead, one should either stick with the Common Law approach of putting everything in the agreement, including long lists of definitions (which appear redundant and sometimes even funny to a German lawyers eyes). Or use the German approach, stick with the brief German style templates and trust your German counsels when they tell you that everything you need is the statutory law anyway.

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The law firm Graf & Partners was established in 2003 and has many years of experience with British-German and US-German legal matters, including the preparation and drafting of English-German commercial agreements and corporate documents.

The Anglo-German litigation lawyer team of GP Chambers is well equipped to advise and represent clients from the UK and other English speaking countries. If you wish us to advise or represent you in a German or cross border case, or if you need an expert report on German law, please contact German lawyer Bernhard Schmeilzl, LL.M. (Leicester), managing partner and head of the litigation department. Bernhard is also frequently asked by British and US Courts and Tribunals or by legal counsels to provide expert reports and legal opinions on German law.

Most Germans die without a Will

German Intestacy Rules Explained

The German rules about what happens when a person dies without having made a valid will (intestacy), are set out in section 1923 to 1936 German Civil Code (Bürgerliches Gesetzbuch, an English translation being available here.

Intestate succession affects many families because roughly two out of three Germans die without having a valid Will in place. German intestacy rules are very different from those in Common Law countries. Children of the deceased have a much stronger legal position in Germany compared to children under English or US succession law. And there is the famous German “Pflichtteilsrecht” (“compulsory share”), which appears a rather baffling concept to British or US-American succession lawyers, because it entitles one’s closest relatives to a share in the Estate (up to 50%) even if the testator cannot stand that person (for details see here).

Who gets how much under German Intestacy Rules?

Before we get too technical, let’s look at the outcome in the three most common constellations: Continue reading