OGH: Calculation of Compulsory Portion for Inherited Apartments

Sept 20, 2024 Benn-Ibler Rechtsanwälte

The Austrian Supreme Court (Oberster Gerichtshof, hereinafter OGH) had to consider the question of how to calculate the claim of other compulsory-portion beneficiaries in the case where a beneficiary who, as co-owner of the testator’s apartment, now inherits the co-owned apartment.

In his will, a testator named his wife as his sole heir. He and his wife were co-owners of an apartment. The wife was in urgent need of housing. In settlement of the daughter’s compulsory portion, the daughter received approximately EUR 30,500. Now the daughter wants the widow to pay what the daughter considers to be her outstanding compulsory portion claim, based on the net estate plus the value of half the minimum share in the apartment.

The court of appeal allowed the defendant’s objection only in part, as merely half of the purchase price for the apartment to be paid by the defendant to the estate could be used as the basis for calculating the daughter’s claim to her compulsory portion. Given that the property included in the reserve was not included in the estate due to the immediate transfer of ownership to the defendant, only the purchase price to be paid to the estate could be used as the basis for calculating the compulsory portion. The court of appeal’s decision was therefore upheld by the OGH.

Accrual pursuant to Section 14(1)(1) WEG (Wohnungseigentumsgesetz, Austrian Condominium Act) is a unique instrument. The special succession on death provided for therein results in the testator’s share being the minimum share and the co-ownership of the flat not forming part of the estate due to this direct transfer of ownership.

However, Section 14 (2) of the WEG obliges the purchaser to pay the inheritance price to the estate, which is set at half the market value of the minimum share. This serves as compensation for the loss of half of the minimum share and is intended to prevent the heirs and persons entitled to a compulsory portion from being disadvantaged.

If the owner-partner is a beneficiary of a compulsory portion who has an urgent need for housing, the obligation to pay a takeover price does not apply. However, if there are other beneficiaries of a compulsory portion, the payment of the takeover price does not cease. In this case, a quarter of the value of the minimum portion, i.e. half of the takeover price, must be paid to the estate. According to general principles not affected by the special regulation of the WEG, the compulsory portion of the daughter is to be calculated from the mere estate, in which case only half of the takeover price is to be used for calculation.

OGH 2 Ob 123/24p (25 July 2024)