Sweden: Diamond Dealer's Gifts

 

Flood Herslow Holme has assisted the three children in the dispute "Diamond dealer's gifts" which was decided by the Supreme Court on 16 July 2021 (case no. T 4171-20). The case concerns the inheritance after the children's father according to the so-called strengthened legal lot protection in ch. Section 4 of the Inheritance Code. The Supreme Court has now finally settled the dispute and the children won full success with their claim.

During the last years of his life, the children's father gave extensive gifts to his wife and they also carried out a division of property during the marriage. The transfers were either conditional or took place during a time when the father was seriously ill. On the day of his death, the father had basically no cash left. The three children, who were from a previous marriage, blamed both the gifts and the division of property for concluding their team lot. The wife is now obliged to return half of these transfers to the children.

Flood Herslow Holme is proud to have contributed to the development of law in economic family law through this judgment. The ruling clarifies, among other things, three important issues:

The first was the question at the Supreme Court was whether the division of property was to be equated with a will. The answer in this case was yes. The Supreme Court states that the general starting point is that a first division of property during the marriage, which means a division of halves, is not affected by the strengthened legal lot protection. However, if the division of property in an overall assessment appears as part of a complex transaction which in reality means that the right to a legal lot is circumvented, it should be possible to cover it. An overall assessment must always be made where all gifts or other legal acts between the spouses that are temporal or otherwise interconnected are taken into account.

The second question was how much of the transfers would be returned in the calculation of the team lots. The Supreme Court clarifies that it is the entire value of the gift - not half - that must be added to the estate and that this is not changed by the fact that the testator was married to the recipient of the gift.

The third question was whether there were special reasons against applying the strengthened legal lot protection. The Supreme Court states that this exceptional rule is not intended to be used to compensate for previous gifts to legal heirs entitled to lots, children, grandchildren, etc.), which due to special explanation by the testator or otherwise should not be deducted from the lot. Nor shall the exemption provision generally be applied when the recipient of the gift is the spouse of the deceased. The specific reasons must be attributable to the specific circumstances of the individual case.

The Supreme Court ruled entirely in the children's favor and the wife must therefore pay a total of approximately SEK 22 million to each of the three children (in addition to interest and costs).

You can read the decision here.

 

For further information, contact:

Toralf Hällen or Ida Järvegren,

Flood Herslow Holme,  Malmö

 

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