The 5 most common mistakes when making a testamentary disposition
A testamentary disposition – whether in the form of a will, an inheritance agreement, or a gift effective upon death – is one of the most important legal instruments for determining how one's estate is to devolve.
Even so, many people postpone making such arrangements or make mistakes that may later result in serious family disputes or even in the invalidity of the will. Below I have outlined the five most common mistakes.
- No testamentary disposition at all
The most common mistake is not making any testamentary disposition whatsoever. In that case, succession is determined by law, which does not always reflect the deceased person's actual wishes. Someone may wish to support a particular person or organisation, or to divide assets among family members in different proportions – but without a testamentary disposition, those wishes will not take effect.
- Formal defects in the will
Handwritten wills often contain formal defects that may later jeopardise their validity. Examples include the absence of a date, a defective signature, or failure to comply with statutory formal requirements. Involving legal counsel can help avoid such problems.
- Imprecise or ambiguous wording
If a testamentary disposition is not expressed clearly, disputes may easily arise among the heirs. Precise and unambiguous wording is essential to prevent later conflict and to ensure that the testator's wishes are properly given effect.
- Ignoring compulsory-share rights
Many people do not realise that certain close relatives – for example children or a spouse – may, by law, be entitled to a compulsory share of the estate. This means they may still have a claim to part of the estate even if they are not named as heirs in the will. A testator may confine an entitled relative to the compulsory share by not appointing them as an heir, but that is not the same as disinheritance.
- The testamentary disposition becomes outdated
Life situations change over time: marriage, divorce, the birth of a child, or the acquisition of new assets can all affect what succession order or proportions would be desirable. If the testamentary disposition is not updated, it may no longer reflect the testator's current wishes.
A carefully drafted and legally compliant testamentary disposition not only safeguards the testator's wishes, but also plays an important role in preventing family conflict. For that reason, it is advisable to obtain legal assistance when preparing the document so that it is appropriate both in form and in substance.
Why is it advisable to enter into a marital property agreement?
For many people, getting married is primarily an emotional and family decision, but it also has significant property-law consequences.
Under Hungarian law, spouses are subject to a community property regime unless they agree otherwise. This means that assets acquired during the marriage are, as a general rule, considered joint property.
A marital property agreement allows spouses to regulate their property relations differently. Although many people still regard this solution with suspicion, it is in fact a prudent and responsible decision that can prevent numerous later conflicts and legal difficulties.
What does a marital property agreement regulate?
In a marital property agreement, the parties may define, among other things:
- which assets belong to separate property,
- how assets acquired during the marriage are to be treated,
- how property should be divided in the event of a divorce,
- what rules should govern the parties' economic cooperation.
The agreement allows the parties to make an individual arrangement tailored to their own life situation.
Protection in the event of divorce
The dissolution of a marriage can be burdensome not only emotionally but also financially. If there is no marital property agreement, dividing joint property often leads to lengthy disputes and even court proceedings.
A marital property agreement can simplify this process considerably. The parties define their property relations while the relationship is still harmonious, which means far less uncertainty and conflict if divorce later occurs.
The agreement may be especially important, for example, if:
- one party already has substantial assets at the time of marriage,
- the parties operate a business,
- one spouse acquires high-value assets during the marriage.
Protection in cases of debt
A marital property agreement may provide protection not only in the event of divorce, but also if one spouse accumulates debts. In some cases, one spouse conducts a business activity, operates a company, or assumes economic risks that may give rise to liabilities.
If there is no separate agreement on property relations, the joint property may become exposed when those debts are settled. A carefully drafted marital property agreement can help ensure that the other spouse's assets remain protected in such situations.
It is not a sign of mistrust
Many people are reluctant to conclude a marital property agreement because they feel it signals a lack of trust. In reality, however, it is far better understood as an instrument of prudent planning.
The aim of the agreement is not to weaken the relationship, but to create predictability and legal certainty. Experience shows that clear financial arrangements can make a meaningful contribution to preventing conflict.
Why seek a lawyer's assistance?
A marital property agreement is valid only if it is set out in a notarial deed or in a private document countersigned by a lawyer. An experienced lawyer can assist in drafting the agreement and in ensuring that it is properly tailored to the parties' actual life situation.
An arrangement prepared with professional care can provide long-term security for both parties and help ensure that property issues do not later become a source of dispute.
Letting property – key legal points to consider
Letting property can provide a stable source of income, but it can also involve significant legal risks.
A lease agreement that is not properly drafted can easily lead to disputes, financial loss, or even lengthy legal proceedings. That is why it is especially important for the parties to record the terms of the tenancy accurately and carefully.
Although a lease agreement may often appear to be a simple arrangement, in practice a number of legal issues can arise that are best regulated clearly and properly at the time the contract is concluded.
The legal basics of a lease agreement
Under the Civil Code, under a lease agreement the landlord must provide the tenant with temporary use of the property – for example a flat or business premises – while the tenant must take over the property and pay rent.
As a rule, the law does not require lease agreements to be in writing: a contract may even come into existence orally or by implied conduct. In practice, however, the absence of a written agreement can cause serious evidential difficulties. If the parties later dispute matters such as rent, the security deposit, or termination conditions, the lack of a written document can make the enforcement of legal rights considerably more difficult.
The most common legal pitfalls in lease agreements
Experience shows that disputes relating to tenancy relationships often arise in connection with the termination or ending of the contract.
Fixed term or indefinite term
An important question is whether the parties conclude the contract for a fixed term or for an indefinite period. If the contract does not contain a clear provision on duration, the tenancy will generally be treated as indefinite. In practice, this can make a substantial difference, for example regarding termination rights or the conditions under which the tenant must vacate the property.
What happens after the contract expires?
It is common for a fixed-term agreement to expire while the tenant continues to use the property. If the landlord does not object within a short period after expiry, the tenancy may even convert into an indefinite-term relationship. Many landlords are surprised by this, which is why it is important to regulate the conditions of termination in the contract itself.
Use without legal basis
If the lease ends but the tenant does not return the property, the tenant may qualify as a possessor without legal basis and may be required to hand the property back and, where appropriate, pay a usage fee or damages. Such situations often lead to lengthy proceedings, especially if the relationship between the parties was not adequately regulated in the contract.
Seek legal assistance with drafting the document
A lease agreement is not merely a short document consisting of a few basic points. A well-prepared agreement regulates numerous issues that can prevent significant disputes later on.
A contract prepared with professional assistance can cover, among other things:
- the rent and method of payment,
- the handling and repayment of the security deposit,
- maintenance and repair obligations,
- rules for use of the property,
- termination and the conditions on which the agreement ends,
- issues of damage and liability.
These provisions can significantly reduce the risk of disputes later arising between landlord and tenant.
Prevention is always easier than a legal dispute
A substantial part of the problems arising in connection with letting property could be prevented by a properly drafted contract. A short template downloaded from the internet often does not take account of the specific features of the particular legal relationship and does not include the detailed provisions that are crucial in practice.
Experience shows that a lease agreement prepared with legal assistance is not only more robust from a legal perspective, but also makes cooperation between the parties more transparent.
Important information about payment requests
In property sale transactions, it is often necessary to transfer larger sums of money. A payment request can be a solution to make this process fast and cost-efficient.
A payment request is an electronic payment message sent by the beneficiary to the payer. Once accepted, the transaction can be executed immediately.
For amounts above HUF 20 million, the process must be handled in several instalments.
If you are unsure which payment solution is advisable in a specific transaction, it is worth discussing it in advance.
