The subject of inheritance comes up in everyone’s life sooner or later, but often we are completely unprepared. The legal administration of a death is a particularly sensitive area, as it can be difficult not only to deal with the emotional burden of bereavement but also to settle property issues. It is therefore particularly important to be aware of the main rules and options for succession well in advance.
In Hungary, inheritance is governed by the Civil Code. Accordingly, there are two basic forms of succession: intestate and testate succession. Of the two, the testamentary succession always takes precedence, i.e. if the deceased has left a valid and legal will, the succession of property is governed by its provisions. Otherwise, the legal succession takes effect, following a strict order of succession depending on who survives the testator.
In the case of a legal succession, the deceased’s descendants – his or her children – inherit first, in equal shares. If a child is no longer alive, his or her own descendants, i.e. grandchildren, take his or her place, also sharing equally the share that would have been due to their deceased child. This system ensures that the descendants by blood always share in the estate. If the deceased is survived by a spouse, she has a so-called widow’s right alongside her descendants, i.e. the right to use the dwelling in which she and her spouse lived and the usual furnishings for the rest of their lives. If there are no descendants, the surviving spouse shares the estate with the parents and in some cases may inherit the whole estate.
If the testator has no descendants, the parents inherit. If one parent has died, the other inherits the entire estate. If neither parent is still alive, the inheritance may pass to the grandparents and then to more distant relatives such as brothers, sisters or cousins. If there is no legal heir at all, the inheritance passes to the state, which becomes the heir of last resort.
The other main type of inheritance, testate succession, allows the testator to decide the fate of his or her property as he or she sees fit. When making a will, the testator is free to decide who he wishes to inherit and in what proportion. It is also possible to make provision for the entire estate or only for certain assets. However, it is important that the will is only valid if it complies with the legal formalities. It can be written entirely by hand, in which case no witness is required, but if it is done by computer or computerised means, two witnesses must sign it. A will made in front of a notary is automatically considered valid, and is also secure because it is entered in the national register. An oral will can only be made in special cases – for example, in the event of danger to life or war – and its validity is much easier to challenge.
Even if the testator leaves a valid will, there is a legal instrument that protects certain relatives: the compulsory portion. The purpose of a compulsory portion is to ensure that the testator’s next of kin – his or her children, spouse or parents if there are no descendants – are not left without any assets even if they are not named as heirs in the will. They are entitled to receive one third of their legal share in cash or in kind. If the testator deliberately leaves them out, they can claim this amount from the heirs in the probate proceedings.
Inheritance is not an automatic process, but takes place through a formal procedure called probate. The first step is to register the death, then inform the notary and take an inventory of the estate. The latter includes the assets that are part of the estate – such as property, bank accounts, motor vehicles, other valuables – as well as any debts of the deceased. After the inventory, the estate is passed on to a notary who will hold a hearing and issue a probate order, under which the inheritance is formally transferred to the heir(s).
Many people do not know that an heir inherits not only assets but also debts, albeit with limited liability. This means that the heirs are only liable for the debts of the testator up to the amount of the estate – they are not obliged to stand up for them with their own assets. It is important to know, however, that if an heir accepts the inheritance, he or she also assumes the debts – even if they are only discovered later.
The inheritance can, of course, also be rejected. This is a unilateral declaration that must be made during the probate procedure. In this case, the heir who rejects the will is put in the position of never having been an heir – and is replaced by another heir under the legal succession or the will.
An increasingly common question about inheritance is whether it is possible to ensure that assets are settled in our lifetime. The answer is yes: we can make provision for the succession of our assets during our lifetime, either by inheritance or by gift. An inheritance contract can be a particularly useful solution in old age, for example if someone takes on care or nursing care and in return becomes entitled to inherit the property.
In short, inheritance is not only a legal act, but often a very significant event from a family, emotional and financial point of view. Proper information, informed planning – for example, making a will – and timely decisions can help to avoid future disputes, family conflicts or even legal complications. Knowledge of the legal background to succession is therefore essential not only for lawyers but for all responsible people.
