Waiver of inheritance rights is a contractual arrangement that allows an heir to give up, in whole or in part, the expectant rights they hold over an estate that has not yet devolved. Thanks to this institution, laid down in Article 528 of the Turkish Civil Code No. 4721, the deceased and the heir are able to reach a mutual agreement here and now over inheritance rights that will arise in the future.
The contract may be concluded in return for consideration, but it may equally be made without any performance being stipulated; as to its scope, it may cover the whole of the inheritance right or only a specified part of it. Waiver must not be confused with renunciation of inheritance. The essential distinction lies in the element of time: a waiver is concluded while the deceased is still alive, whereas renunciation is a power that can be exercised only once the succession has opened.
Below we examine in turn the legal nature of the waiver contract, the forms it takes, the conditions of its validity, the consequences it produces, the circumstances in which it comes to an end and the grounds requiring its annulment.
Definition and Nature of the Waiver Contract
Waiver of inheritance rights is a contract enabling an heir to give up, in part or in whole, the rights of an heir over a succession that has not yet opened. Art. 528 of the Turkish Civil Code No. 4721 allows the deceased and the heir to reach agreement over rights that will arise in the future.
Turkish Civil Code No. 4721, Art. 528
“By a contract concluded between the deceased and one of his heirs, the heir may give up the status of heir, either without consideration or in return for consideration.”
This contract is a disposition upon death which is concluded during the lifetime of the deceased but produces its effects and consequences only upon the opening of the succession. Whether or not consideration is stipulated is left to the choice of the parties, and the waiver may also be drawn so as to cover the whole of the inheritance right or a specified portion of it.
Types of Waiver Contract
Waiver takes different forms according to whether it rests on a counter-performance and according to its scope. For the purposes of the Turkish Civil Code No. 4721 the distinction between waiver for consideration and waiver without consideration is particularly decisive; alongside this, a waiver may be made either in full or in part. Identifying the type matters for determining the consequences the contract will produce and, in particular, its effect on the descendants.
Waiver for Consideration
In this type the heir gives up the inheritance right by accepting consideration provided to them. The consideration may be in cash, or it may be agreed in the form of the transfer of an immovable property, a company shareholding or another performance of economic value.
A typical example of this type is the deceased transferring an immovable property to their child, in return for which the child gives up the inheritance right that will arise in the future.
Art. 528 of the Turkish Civil Code No. 4721 expressly accepts that a waiver may be made in return for consideration. Waiver for consideration is also the type most frequently resorted to in practice; it is used in the transfer of family companies, in the division of immovable property among children and in preventing inheritance disputes likely to arise later.
Waiver without Consideration
In a waiver without consideration the heir’s surrender is not tied to any counter-performance; the giving up is entirely gratuitous.
Here the heir relinquishes, of their own free will, the rights that will arise in the future from their status as an heir. Even so, the scope of the waiver, and in particular the effect it will have on the descendants, must be assessed carefully on the wording of the contract.
Full Waiver
A full waiver denotes the heir giving up all of the rights flowing from their status as an heir. A person who is party to such a contract cannot, as a rule, acquire the status of heir when the succession opens and can make no claim over the estate.
Whether a waiver is full or partial is determined by construing the terms of the contract. Where the text contains no express limitation, the scope must be assessed separately.
Partial Waiver
In a partial waiver the surrender covers only a specified portion of the inheritance right or specified rights. An example is an heir waiving only the rights relating to their reserved portion, or a particular share in the estate.
In contracts of this kind it is of great importance that the scope be drawn clearly and so as to leave no room for doubt. Otherwise a dispute at the stage of construing the contract becomes inevitable.
For that reason the text must expressly set out which rights are surrendered, in what proportion and on what conditions.
How Is the Contract Concluded?
A waiver contract cannot be concluded by a plain written text drawn up between the deceased and the heir. Article 545 of the Turkish Civil Code No. 4721 makes the validity of contracts of succession conditional upon their being drawn up in the form of an official will. A waiver contract, accordingly, can be concluded only by following the official procedure prescribed by law.
In practice the parties apply together to a notary. The text prepared by the notary expressly sets out the scope of the waiver, whether consideration has been stipulated, and the other matters on which the parties have agreed. Once the parties’ declarations of intention have been taken, the contract is drawn up in official form and signed.
The following elements are required if a valid waiver contract is to be concluded:
- That the contract has been drawn up in the form of an official will
- That both the deceased and the waiving heir take part in the contract as parties
- That the parties have the capacity to conclude the contract
- That the requirements as to witnesses and signatures laid down by law have been complied with in full
Agreements made without complying with these conditions produce no legal effect. In particular, documents drawn up between the parties in simple written form, and oral understandings, do not bring about a waiver.
Conditions of Validity
For the contract to produce effect, the conditions of validity required by law must all be satisfied. Where one of these conditions is absent, the invalidity or the annulment of the contract arises.
Capacity of the Parties
Since a waiver contract is in the nature of a contract of succession, the conditions in Article 503 of the Turkish Civil Code No. 4721 apply as regards the deceased. Accordingly, the deceased must have the power of discernment, be of full age and not be under legal restriction — that is, must have full capacity to act.
As regards the waiving heir, the general rules on capacity apply; the heir must have the capacity required by the nature of the contract.
The Parties Must Be the Deceased and an Heir
This contract may be concluded only between the deceased and their heir. One of the parties must necessarily be the deceased, the other their statutory or appointed heir.
Agreements made with third parties who do not have the status of heir do not count as waiver contracts. The right surrendered is the expected right of inheritance, and only persons in the position of an heir can give up that right.
The Mandatory Official Form
A waiver contract is subject to the rules of form applicable to contracts of succession. Under Art. 545 of the Turkish Civil Code No. 4721 the text must be drawn up in the form of an official will.
The contract must therefore be drawn up before a notary or an authorised public officer, the parties must declare their intentions to that officer, and the requirements as to witnesses and signatures laid down by law must be satisfied.
Waiver agreements concluded in simple written form or made orally are not legally valid.
The Intention Must Not Be Vitiated
As in every contract, the parties’ intentions must here too have been freely formed. Waiver contracts concluded under the influence of mistake, fraud or duress are not treated as legally valid.
Where an heir has been induced to sign by being given untrue information, has been deceived or has been subjected to pressure, the annulment of the contract may be sought.
For validity, therefore, the parties must have declared their intentions knowing the content of the contract, willingly and without being under any pressure.
Effects and Consequences of the Contract
A waiver contract produces its consequences upon the death of the deceased. Although it becomes binding as between the parties from the moment of its conclusion, its effects on the status of heir materialise only when the succession opens.
The consequences that arise may differ according to whether the contract includes consideration, according to the scope of the waiver and according to any special stipulations included in the text.
The Position of the Waiving Heir
The person who waives loses the rights arising from the status of heir to the extent of the surrender. In a full waiver the person cannot, as a rule, acquire the status of heir when the succession opens and can make no claim over the estate.
In a partial waiver the surrender is confined to the rights or shares specified in the contract. It is therefore of great importance that the scope be clearly determined in the text.
The Effect of the Waiver on the Descendants
Under Art. 528 of the Turkish Civil Code No. 4721, unless the contract provides otherwise, the effect of the waiver extends also to the descendants of the person waiving.
Accordingly, the children of the person waiving and their descendants likewise cannot, as a rule, be heirs. The parties may nonetheless stipulate in the contract that the waiver is to be confined to the person surrendering the right. Where such a stipulation is included, the descendants continue to retain their right of inheritance.
The Position of the Descendants in a Waiver for Consideration
Under Art. 528 of the Turkish Civil Code No. 4721, in waiver contracts made in return for consideration too the surrender covers the descendants of the person waiving unless otherwise agreed.
Where, for example, the deceased has had a child waive their inheritance in return for an immovable property or a specified sum, the grandchildren likewise cannot acquire the status of heir unless the contract provides to the contrary.
For that reason it is recommended in practice, particularly where family companies and high-value immovable property are involved, that the position of the descendants be regulated separately in the contract.
The Effect on the Reserved Portion
By a waiver contract an heir may give up not only the statutory share of inheritance but also the right to the reserved portion. A person who is party to a valid waiver contract cannot, therefore, claim abatement after the succession has opened on the ground that their reserved portion has been infringed.
Where, on the other hand, the scope of the waiver has been kept narrow or confined to specified rights, the effect on the reserved portion must likewise be assessed separately according to the content of the contract.
The Effect on the Distribution
A waiver contract directly alters the circle of heirs to be taken into account in the distribution. Because the person surrendering the right loses the status of heir, the estate is redistributed among the remaining heirs according to the statutory proportions.
This consequence carries particular weight in families with a large number of heirs, in the transfer of family businesses, and where the aim is to concentrate particular items of property in particular hands.
As will be seen, a waiver contract does not concern only the heir who surrenders their right; it is an important instrument of estate planning that also affects the shares of the other heirs and the manner of the distribution.
Can the Contract Come to an End?
A waiver contract is a contract of succession concluded between the parties and producing, as a rule, binding consequences. Neither the deceased nor the heir can therefore withdraw from it by a unilateral declaration of intention. Even so, in certain cases provided for by law the contract may come to an end or become ineffective.
Termination by Mutual Agreement
The parties may set the waiver contract aside by agreement. Under Article 546 of the Turkish Civil Code No. 4721 a contract of succession may at any time be set aside by an agreement made by the parties in writing.
The deceased and the waiving heir may accordingly set aside together, at a later date, the contract they previously concluded, or amend its terms. This requires mutual and corresponding declarations of intention by the parties.
Automatic Ineffectiveness
In certain cases the contract becomes ineffective automatically, without the need for any further transaction.
Under Article 529 of the Turkish Civil Code No. 4721, where a waiver made in return for consideration has been drawn up in favour of a particular person and that person has for any reason failed to become an heir, the waiver loses its validity unless otherwise agreed.
Where, for example, a child has waived their inheritance in favour of a sibling but the sibling has died before the deceased, the waiver too lapses unless the contract provides to the contrary.
Withdrawing from a Waiver by a New Contract
A waiver cannot be withdrawn from unilaterally. The parties may, on the other hand, conclude a new contract at a later date and thereby set the earlier waiver aside entirely or alter its scope.
An example is an heir who initially waived the whole of the inheritance and the deceased setting the waiver aside by a new contract concluded later, or confining it to a specified share only.
The amendment or setting aside of a waiver contract therefore depends, as a rule, on the common intention of the parties. A subsequent change of mind on the part of one of them does not of itself deprive the terms of the contract of effect.
Annulment of the Waiver Contract
A waiver contract concluded in due form is binding on the parties. Where certain grounds provided for by law are present, however, the annulment of the contract may be sought. If annulment is ordered, the rights of the person who waived, relating to the status of heir, may arise once more.
Grounds for Annulment
The principal grounds capable of leading to the annulment of the contract are as follows:
- Failure to comply with the requirements of official form laid down by law
- One of the parties lacking the requisite capacity
- The contract having been concluded as a result of a mistake
- The intention having been obtained by deception, that is, by fraud
- The text having been signed under duress or pressure
Where one of these grounds is present, an action may be brought seeking annulment.
Standing to Bring the Action
The annulment may be sought by persons having a legal interest in the invalidity of the contract. Those persons are, in particular:
- The waiving heir themselves
- The deceased
- The descendants of the person waiving
- The other heirs whose share of the inheritance or right of inheritance is affected by the waiver
- Other rightholders directly affected by the validity of the contract
For the action to be entertained, the claimant must have a current and protectable legal interest in a finding that the contract is invalid.
Time Limits for the Action
In actions for the annulment of a waiver contract, the time limits in the general provisions on the annulment of contracts of succession apply.
Under Article 559 of the Turkish Civil Code No. 4721 an action for annulment must be brought within one year of the date on which the claimant learned of the disposition, of the ground of annulment and of their own status as a rightholder.
The maximum periods after which this action lapses are as follows:
- Ten years from the opening of the disposition where the respondent is in good faith
- Twenty years from the opening of the disposition where the respondent is in bad faith
These periods are preclusive in nature and are taken into account by the court of its own motion. It is therefore of great importance that no time be lost in bringing the action once the ground of annulment has come to light.
Independent Legal Assessment
In practice a waiver contract is most often concluded as an instrument of estate planning; where the wording of the contract is not drafted with sufficient care, however, the planning itself can turn years later into the source of a dispute. Where in particular the contract does not expressly regulate whether the scope is full or partial, whether the reserved portion is included in the waiver, and the position of the descendants, arguments of construction begin as soon as the succession opens.
A further critical point is the rule of form. Simple written protocols signed within the family, and oral understandings, do not bring about a waiver, however sincerely they may have been concluded between the parties. Transfers of property made in reliance on documents of this kind can prove difficult to put right afterwards.
In a concrete file we recommend that the following headings be addressed first:
- Verifying that the contract has been drawn up in the form of an official will and in compliance with the requirements as to witnesses
- Determining the scope of the waiver by stating expressly whether the reserved portion is included
- Regulating by a special stipulation in the contract whether the descendants are to be left outside the waiver
- Setting out concretely, in a waiver for consideration, the nature and value of the counter-performance and the time of its performance
- Anticipating, in waivers made in favour of a particular person, the risk of automatic ineffectiveness arising from Art. 529 of the Turkish Civil Code No. 4721
- Documenting the starting point of the one-year period where a ground of annulment is thought to exist
Independent Legal provides advisory services and conducts litigation at every stage of the process, from the drafting of waiver contracts for estate planning purposes to the conduct of disputes concerning the annulment of such contracts.