A legal successor designated as the heir to the farm may become the sole heir if the agricultural holding ceases to qualify as a farm within the meaning of the Farm Regulations (HöfeO) (Decision of the Higher Regional Court of Hamm of 21 March 2018, Ref.: 10 W 63/17).
Despite an inheritance agreement concluded with the testator, a beneficiary may renounce their agreed Succession to the farm lose this entitlement if the status as a farmholder has been lost in the meantime due to the permanent cessation of farming operations. However, under certain circumstances, the original beneficiary may then be regarded as the sole statutory heir.
The aforementioned decision was based on the following facts:
The applicant is the son of a deceased cousin of the testator; the respondent is one of the testator’s six nieces and nephews. The parties are in dispute over the issue of a certificate of succession to the applicant on the basis of an inheritance agreement concluded between the testator and the applicant.
The 93-year-old testator was the owner of a farmstead which was entered in the land register as a farmstead within the meaning of the CourtyardsO was registered. The farm originally comprised approximately 100 ha of agricultural land, on which the deceased mainly practised arable farming. Over the course of the last forty years, the deceased sold off arable land, with the result that his farm ultimately comprised only approximately 13 hectares of arable land and approximately 7.5 hectares of woodland.
Since 2000, the agricultural land has been leased to the applicant, who is a qualified farmer and the owner of a neighbouring farm within the meaning of the HöfeO. At the time of his death, the deceased’s farm no longer held any inventory; all the buildings belonging to the farm had, for the most part, been let out for commercial purposes. The deceased had, in the meantime, converted the large hall in his residential property into an events venue and let it to a local catering company. Towards the end of his life, the deceased derived most of his livelihood from rental and lease income. In 2005, the deceased entered into a notarised inheritance agreement with his siblings, under which he bequeathed to them co-ownership of two building plots. In 2007, he entered into a further inheritance agreement with the applicant, in which he appointed the applicant as the heir to the farm. The applicant’s consideration consisted of a monthly annuity of 850 euros, which he undisputedly paid to the deceased until the latter’s death.
Following the testator’s death, the applicant applied for the Issuing a certificate of succession, pursuant to which he had been appointed sole heir to the farm under the inheritance agreement concluded in 2007. At first instance, the respondent argued that the claimant had not become the heir to the farm because, at the time of the testator’s death, the testator’s farm was no longer a farm within the meaning of the Farm Act (HöfeO). Consequently, the testator’s estate had passed to his nieces and nephews by way of intestate succession.
The Paderborn Agricultural Court upheld the applicant’s claim and deemed that the facts required for the grant of the sought certificate of farm succession had been established. The status as a farm was lost outside the land register as a result of the permanent cessation of farming operations. The respondent lodged an appeal against this decision, which led to the decision being amended.
The Higher Regional Court of Hamm did indeed conclude that the applicant could not be issued with a certificate of succession to a farm, even though a note regarding the farm was still entered in the land register. This was because the agricultural property left by the testator was no longer a farm within the meaning of the Farm Act (HöfeO), as the agricultural business unit had been permanently wound up. The deceased had already permanently ceased farming his agricultural holding in 2000, several years before the conclusion of the inheritance agreement with the applicant. The inheritance agreement concluded with the applicant in 2007, which assumes the continued existence of a farm within the meaning of the HöfeO, does not restore the property’s status as a farm.
However, the court upheld the applicant’s alternative claim, namely that he should be granted a certificate of inheritance as sole heir under general inheritance law (and not under the HöfeO).
In the present case, this follows from an interpretation of the notarised inheritance agreement. The provision contained therein Determination of the heir to the farm should be interpreted as meaning that the applicant was to become the testator’s legal successor even in the event that the agricultural property had ceased to qualify as a farm within the meaning of the Farm Regulations (HöfeO). The circumstances at the time the inheritance contract was concluded suggested that the applicant’s appointment as heir should be assumed even if the testator had Loss of farm status would have recognised and taken into account. The testator’s intention had been to preserve his estate in its entirety and not to have it fragmented by a division amongst his nieces and nephews – which would have occurred under the rules of intestate succession. Consequently, in accordance with general inheritance law, the applicant is to be issued with a certificate of inheritance designating him as the sole heir of the testator.
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