Estate Executors in Germany: Duties, Liability, Costs

The execution of a will must be clearly specified in the will in Germany to ensure that the testator's last wishes are carried out smoothly and in accordance with their intentions, and to avoid potential legal disputes or delays. Only if the designated person, often a law firm, is clearly specified and the scope and nature of the execution are transparently defined can the executor fulfill his duties effectively and in a legally secure manner. Missing or unclear specifications often lead to uncertainties, additional costs, and conflicts among the heirs.

The executor is obliged to administer the estate properly and conscientiously. Their main duties include:

• Drawing up a complete inventory of the estate and notifying the heirs without delay
• Administering and securing the estate, including settling estate liabilities
• Carefully implementing all of the testator's last will and testament
• Providing information and accountability to the heirs regarding all measures and results of his activities
• Preparing and submitting the inheritance tax return and ensuring payment of inheritance tax
• Safeguarding the interests of all heirs and strictly observing any instructions made in the will

In the event of a breach of these duties, the executor is personally liable for any damages.

The execution of the will should be implemented precisely and in a legally secure manner in the will. The person or institution that is to take on the role must therefore be clearly named. Likewise, the tasks and scope of the execution of the will should be precisely defined, for example, whether it is a

• Settlement execution (serves to settle the estate, i.e. distribute the estate to the legatees and heirs),
• Permanent execution (serves to manage the estate in the long term (maximum 30 years) in order to preserve the assets or ensure certain purposes are fulfilled – especially if the heirs are still minors), or
• Administrative execution (serves the professional administration of the estate; no obligation to distribute the estate in full).

It should also be mentioned whether substitutes are provided for. The more detailed and individualized these provisions are, the lower the risk of ambiguities or conflicts after the inheritance.

The work of an executor can be very extensive and time-consuming, especially in the case of an estate that includes real estate, company shares, or works of art. It is therefore advisable to include clear and fair remuneration provisions in the will. This can be

• a flat fee,
• an hourly fee,
• a percentage of the value of the estate, or
• a reference to recognized remuneration tables.

It should also be specified when the remuneration is to be paid – whether after completion of the estate settlement, at regular intervals, or in installments after certain milestones have been reached.

Especially in cases of complex financial circumstances and lengthy execution (e.g. if the executor is responsible for the sale of assets, such as real estate), it is advisable to settle accounts and remuneration at regular intervals, e.g. monthly or quarterly. In this way, all parties involved avoid having to discuss – and possibly argue about – the expenses incurred and invoiced at the very end, possibly after several years of work by the executor.

If an estate also has a cross-border character, e.g. in the case of foreign assets or heirs with foreign citizenship, international legal peculiarities must also be taken into account. Different legal regulations, recognition of will execution, and possible inheritance tax obligations abroad (e.g. Switzerland, the U.S., or Austria) require early and sound planning. Involving an experienced estate executor with knowledge of international inheritance law and tax law can offer decisive advantages here.