I was surprised that the Times yesterday reported on a case decided this week by the Federal Court of Justice (Bundesgerichtshof).
It looks as if there is some feeling that if German courts allow repayments of in-laws’ gifts when their child divorces, then this may be done in the UK too.
However, the device used would have to be different.
Here’s the BGH press release in German – the judgment isn’t available yet.
The important part of the judgment was that it is now easier for parents-in-law to obtain the return of gifts given to the married couple
The couple had been living together since 1990 and got married in 1997. They had one child before the marriage and one after. In 1996 the son-in-law bought a flat by auction – I don’t know what the full price was, but the parents-in-law gave him DM 58,000 and he transferred DM 49,000 to the court.
The couple separated in 2002 and when they got divorced in 2004 they excluded the usual division of marital property. The flat remained in the sole name of the husband.
The parents-in-law sued for return of the money, and went all the way to the BGH, where they were successful, at least insofar as the court changed its previous line of decisions – it said that where parents-in-law give presents related to the marriage, they do this on the basis that the marriage will continue. In the present case, the divorce is effectively a frustration of the contract of gift/donation (Wegfall der Geschäftsgrundlage). The court can now, at least partly, reverse the transaction. The case was sent back to the court below (Berlin Higher Regional Court – Kammergericht Berlin) for a new decision. It looks as if not all the money will be repaid, since the daughter did live in the matrimonial home for some years and enjoyed some of the gift.
In German law, Schenkung (gift/donation) is one of the types of contract. The court has now decided to treat the parents-in-law’s payment as this kind of contract. Previously, it had a term for gifts from one spouse to another, unbenannte Zuwendung (literally, unnamed gift – Romain calls it gift between spouses), and the parents-in-law’s gift was treated as analogous to this. And if the couple lived in the marital property regime of community of acquisitions (Zugewinngemeinschaft), the gift could not be reclaimed.
So what did The Times do with this? It really wasn’t too bad. It did move the court from Karlsruhe to Berlin. It referred to a house and called the money a ‘down payment’ (which may be true – some of the report must have come from someone who was in court – AFP report was the real source). The header ‘German ordered to repay house deposit to his in-laws after divorce’ is a bit broad: he hasn’t yet been ordered, because the lower court is to do any ordering, and it doesn’t look as if he’ll have to repay the whole thing.