DE: Temporary Weakness of Will May Result in Impropriety of Gifting

Sept 16, 2022 Benn-Ibler Rechtsanwälte

The German Federal Court of Justice (Bundesgerichtshof, BGH) held that an individual’s temporary condition of being easily influenced or having a weak will may well be of importance in the assessment of the propriety of a gift.

The case at hand involved a plaintiff born in 1928 who owned several apartment buildings. The plaintiff met the defendant, who was some 53 years younger than himself, in 2015. The defendant managed the buildings. In 2018, the plaintiff required inpatient treatment at a hospital due to pneumonia. There, he granted the defendant healthcare power of attorney. When the plaintiff was transferred to the intensive care unit, he revoked the healthcare power of attorney. Shortly thereafter, instead, he made a notarial declaration in which he filed for adoption of the defendant as his child and granted the defendant comprehensive powers of attorney. When the plaintiff was transferred back to the normal hospital ward, he then transferred the two properties to the defendant by way of anticipated inheritance. The defendant was entered in the land register as the owner. Subsequently, the plaintiff revoked his previously made declarations of intent, stating that at the time of the transfer of the properties he had not only been legally incapable but had also been pressured into concluding the transfer agreement in an unethical manner. He is now seeking reversal of the land transfer agreement.

According to the German Federal Court of Justice (BGH), the information provided by the plaintiff was sufficient to show that he was incapable to act at the time of the gifting. The description of the course of his illness as presented by him and the certificate of his cognitive impairment are sufficient. According to the Supreme Court, the lower court should have followed the expert opinion submitted on the plaintiff's incapacity.

Furthermore, the BGH criticized the lower court for not taking into account the motives of the recipient of the gift in making their overall assessment. The impropriety of a gratuitous deal may not only arise out of the motives of the donor but, also and even primarily, out of the motives of the recipient of the gift. In particular, if there are any doubts about a donor's ability to form their own free will, it is requisite to assess whether the recipient of the benefit is taking advantage of the situation.

BGH, X ZR 3/20 (26 April 2022)