There are many myths surrounding the execution of a will. But sometimes it makes sense to hire a professional who can take action flexibly, prevent disputes - and doesn't have to be expensive.
Meeting in a law firm (symbolic image): In addition to experts, trusted people from the private environment can also be appointed as executors. Photo: Getty Images
Frankfurt. Anyone who formulates their last wishes should find the most precise words possible. Room for interpretation should be avoided, as should unnecessary details being recorded in writing. But even if you follow these basic rules, it can be useful to appoint an executor.
In the event of death, this ensures that the estate is actually distributed in the wishes of the testator and that no disputes arise between the heirs. What exactly an executor does, when it makes sense, who is allowed to carry out the office and what the legal situation actually is - there is a lot of uncertainty about all of this. Two inheritance law specialists refute ten common myths for the Handelsblatt.
Myth 1: In the event of a dispute, the court will appoint an executor
The testator alone decides whether an executor is appointed. If this is not provided for in the will, judges cannot order it. The testator also determines who should take on the task. The probate court can only appoint someone else if the person named in the will is unable to do so, has already died or does not want to accept the office.
Kerstin Linder, specialist lawyer for inheritance and tax law at the Heussen law firm, says: “However, it depends on the exact wording in the will.” It is therefore advisable not to write: “Paul Schmidt should become the executor of the will”, but first: “I am ordering the execution of the will” – and then mention the name. “Otherwise the question could be raised as to whether execution of the will was desired even if Paul Schmidt is not available,” she explains.
In addition, several replacements should be named. If everyone fails, the court uses lists of people who are available for the office. Julia Roglmeier, specialist lawyer for inheritance law at the law firm RP Erbrecht, says: “To narrow down the circle, you could, for example, specify that the executor should either have a specialist lawyer qualification in inheritance law or tax law, or that he or she should be a member of an executors’ association, i.e. have a great deal of expertise.”
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Myth 2: Executors only divide the inheritance
Basically there are two forms. The executor distributes the estate between several heirs and fulfills the legacies that have been ordered. His tasks also include possibly selling assets such as real estate or liquidating deposits in order to then distribute the proceeds to the heirs.
The permanent will executor, on the other hand, is often used for underage heirs. “Many of our clients order permanent enforcement until their children turn 25 or 28,” says Linder.
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For example, the aim is to prevent young adults from being overwhelmed by sudden wealth in the event of an inheritance and possibly no longer being motivated to complete training or their studies.
Long-term will enforcement can also be considered for heirs who cannot take care of their finances themselves due to an impairment. The same applies if high assets would reduce their entitlement to social benefits.
Myth 3: Only professionals execute a will
Particularly in the case of complex financial circumstances, it may make sense to entrust a lawyer or tax advisor with the execution of the will. However, trusted people from the private environment can also be chosen, such as the testator's sister, uncle or someone from their circle of friends.
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However, a certain level of financial understanding is helpful, although no specific professional training is required by law. In addition, an executor may seek help from experts on individual legal or tax issues.
“But he is not allowed to transfer his office completely to a third party,” says lawyer Roglmeier. And she adds: “If the family relationships are good, the longer-living spouse can also be appointed as executor, which makes it easier for them to handle the estate.” One of the children can also take on the role. However, if there is a dispute between the siblings anyway, a neutral person is certainly the better choice.
Myth 4: Executing a will is always expensive
According to the law, the executor can “demand appropriate remuneration unless the testator has specified otherwise” (Section 2221 BGB). The testator is therefore free to decide how much money the executor should receive.
What is “appropriate” depends on the individual case. “If tax advisors are appointed as executors, a fee is often set in accordance with their remuneration regulations,” says Linder. You can also use the remuneration recommendations of the German Notary Association as a guide. These are generally based on the gross value of the estate on the date of death of the testator.
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Depending on the effort and scope of the estate, large amounts can be incurred. Alternatively, an hourly rate can also be set.
“Private individuals, on the other hand, often take on the tasks free of charge and only receive reimbursement for expenses,” says Linder. Which remuneration model is suitable also depends on whether it is a winding-up execution or a permanent will execution.
Myth 5: Executors are only needed if heirs are at odds
In fact, executors are often appointed when the heirs are at odds. “But they can also help prevent arguments from occurring in the first place,” says Roglmeier. For example, if one child becomes an heir and the other a legatee. The heir takes over the entire legal and economic succession of the deceased, while a legatee only has a claim to a certain amount specified in the will or, for example, to valuables.
“From an inheritance point of view, this makes perfect sense, but emotionally legatees often feel left behind,” says the lawyer. It often helps if the executor handles the legacy instead of the heir. As a result, the heir still has more rights than the legatee, but at least when it comes to fulfilling the legacy, this strengthens the legatee's legal position.
“Even if there is a community of heirs and a property is part of the estate, an executor can make sense,” says Linder. He could regulate the allocation of the property, any compensation payments or even the sale.
Myth 6: An executor is always responsible for the entire estate
In some situations it may make sense to appoint a legatee as executor on your own behalf. “Then he can fulfill his legacy himself,” says Roglmeier. This makes sense if an account or property is bequeathed to a person.
“This strengthens the legatee’s position because he doesn’t have to wait until the heir transfers the account or property to him, but can do it himself,” says the lawyer.
Myth 7: An executor is appointed immediately after the inheritance
In most cases, the executor is actually appointed immediately after the testator's death. “Some clients first want to enable their heirs to organize the estate themselves,” says Roglmeier. Then a kind of grace period could be ordered. “The executor only takes over if the heirs have still not agreed on the estate after perhaps two years.”
This is an “elegant option” that often leads to good cooperation between the heirs. Ultimately, the use of an executor would directly reduce your share of the inheritance due to the associated costs.
Myth 8: The executor must involve the heirs
The executor is guided solely by the will of the testator and otherwise acts at his own discretion. In principle, he does not have to take the opinions of the heirs into account. “For a good relationship, it can make sense for an executor to listen to the heirs,” says Linder. “But he must not let this influence him too much, but must remain neutral.”
Myth 9: The probate court controls the executor
The probate court is not a direct supervisory authority for the executor. However, he is accountable to his heirs. “At the beginning of his work, he has to create an estate register, keep the heirs updated about his activities and inform them about his remuneration,” says Linder.
The executor is the testator's raised index finger. The heirs cannot remove him from office without a good reason. Julia Roglmeier, specialist lawyer for inheritance law at the law firm RP Erbrecht
In addition, “Even if an executor has been appointed, heirs can still obtain the information that they would otherwise have access to,” says Roglmeier. These could be account balances, tax documents or land register entries.
Myth 10: Heirs cannot remove an executor
It is not always convenient for the heirs if an executor has been appointed. “He is the testator’s raised index finger,” says Roglmeier. And she adds: “The heirs cannot remove him from office without good reason.”
However, the heirs can initiate dismissal proceedings against him in the probate court. “There you have to explain why the executor is not suitable and what mistake he made,” says Roglmeier. Reasons could be that he does not fulfill his obligations, puts in too many hours for his work or enriches himself from the estate.
The ban on so-called self-dealing is also important (Section 181 BGB). This means that the executor of the will is not allowed to do business with himself or herself - without other instructions from the testator. For example, he is not allowed to sell any property from the estate to himself.
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