Reduction Case
The invalidation of certain death-related and inter vivos transfers made by the decedent (the person leaving the inheritance) to the extent that they violate the reserved shares of the reserved heirs (i.e., exceed the decedent’s disposal ratio); in other words, if a performance obligation arises from these transactions, the reduction refers to the decision to release the reserved heirs from this performance obligation or, if it has been performed, to return it in that proportion (TMK Art. 560).
As a rule, a reduction lawsuit is a lawsuit in which the heirs with reserved shares, and exceptionally also the creditors of these heirs, request the court to invalidate the bequests exceeding the testator’s disposal ratio to the extent of this excess. A reduction lawsuit can only be filed upon the death of the testator. Even if it is certain that the gift made while the testator was alive infringes upon the reserved shares and would cause irreparable damage if the testator’s death is expected, the reserved heirs still cannot file a reduction lawsuit. They cannot request any precautionary measures for any reason. In short, the rights of the heirs are contingent upon the death of the testator.
Who Can File a Reduction Lawsuit?
Heirs with Reserved Shares and Reduction Lawsuits
According to the Civil Code, as a rule, only heirs with reserved shares can file a reduction lawsuit. As mentioned above, heirs with reserved shares are the descendants, parents, and spouse of the deceased.
Since the right to file a reduction lawsuit is a right that exclusively protects each reserved share heir, neither the representative appointed to the estate nor the executor of the will (the probate officer) has the authority to file this lawsuit.
Each reserved share heir may file the lawsuit independently of the others. Although the amount of infringement on the disposal ratio is calculated taking into account all reserved shares, only the reserved share of the heir filing the lawsuit is subject to reduction, not the entire reducible amount found. In other words, reserved share heirs who do not file a lawsuit cannot benefit from this reduction decision.
If the heir with a reserved share does not have legal capacity, their legal representative will file the reduction lawsuit on their behalf. If they fail to do so, they will be liable under the provisions regarding the responsibility of guardians or trustees.
Creditors of Heirs with Reserved Shares and the Bankruptcy Estate
As stated above, as a rule, only heirs with reserved shares can file a reduction lawsuit. However, creditors of heirs with reserved shares have the right to file this lawsuit if the heirs with reserved shares do not file a reduction lawsuit. The purpose here is to ensure that creditors can collect their claims. However, they can only file this lawsuit if they have a certificate of insolvency regarding the reserved share heir to whom they are creditors. The certificate of insolvency must be dated on the date the inheritance was opened. If the certificate of insolvency was obtained after the inheritance was opened, they cannot file a reduction lawsuit even if a court decision or enforcement proceedings against the debtor have already taken place.
If the debtor has gone bankrupt, the bankruptcy estate has the right to file a reduction lawsuit in this case. Creditors and the bankruptcy estate may grant the reserved share heir a period of time to file a reduction lawsuit and, if this proves unsuccessful, file a reduction lawsuit themselves. This period must be reasonable, or if it is clear that granting a period of time would be meaningless, the creditor or bankruptcy estate may file a reduction lawsuit directly.
Creditors may only claim reduction in their reduction lawsuit up to the amount of their own claims. Similarly, if the heir with a reserved share delays and fails to pursue a reduction lawsuit filed with the intent to cause damage to creditors, the creditors may file a reduction lawsuit themselves by proving this. Likewise, if the heir with a reserved share is disinherited by the testator, the creditors may request the annulment of the disinheritance for the portion of the reserved share equal to the amount of their claim.
Against Whom is the Reduction Lawsuit Filed?
The defendants in a reduction lawsuit are persons who have exceeded the testator’s disposal ratio, infringed upon reserved shares, and made transfers subject to reduction by law. These may be third parties or heirs. If the person to whom the transfer was made has died, their heirs will be the defendants. If the bequest was made to more than one and different persons, more than one person will be the defendant. Although the heir has the right to sue all of them, they are not obliged to do so. However, they will have to bear the consequences of this. Because the rules of succession in reduction may lead to adverse results.
As a rule, a reduction action may be brought against persons who have received a gift. However, the Court of Cassation accepts that, as an exception, such an action may be brought against third parties to whom the gifted property has been transferred. Here, after the transfer made by the testator to eliminate the reserved share rules, if the beneficiary transfers the immovable property to third parties who are aware of the situation, solely for the purpose of depriving the reserved share heirs of these rights, outside the knowledge and instructions of the testator, a reduction action may be brought against these persons of bad faith by the reserved share heirs. In short, for the application of the Supreme Court’s decision on this matter (dated January 13, 1975, No. 1974/7 E, 1975/1 K);
The person liable for reduction must transfer the property to a third party to avoid reduction.
The third party must acquire the property with knowledge of this intention.
Time Limit for Filing a Reduction Lawsuit and Competent Court
The right to file a reduction lawsuit expires one year after the heirs learn that their reserved shares have been infringed upon. Lawsuits regarding wills expire ten years after the date the will is opened, and lawsuits regarding other dispositions expire ten years after the opening of the estate (TMK m. 571). However, if the annulment of one disposition revives (restores) another, the time limits only begin to run from the date the annulment decision becomes final. Here, the one-year period does not run before the opening of the estate. In other words, even if the heir learns before the opening of the estate that the disposition infringes upon their reserved share, the time limits do not run. Similarly, with regard to wills, this period does not begin to run until the will is opened. The starting point of the ten-year period is the date of the opening of the succession for inter vivos transfers and inheritance agreements, and the date of the opening of the will for wills. The date of opening of the will is the date on which the will is opened in the presence of the heirs known to the judge, following its submission to the Court of Peace. As another special case, if a disposition subject to reduction becomes valid due to the cancellation of a disposition, the time limits start to run from that moment.
These one-year and ten-year periods applicable to reduction actions are not statutes of limitations but periods of forfeiture. The courts responsible for reduction actions are the Civil Courts of First Instance.
Raising the Claim of Reduction as a Defense
Separate from the above-mentioned assertion of reduction through litigation, the claim of reduction can also be asserted through a defense. In other words, a hidden heir who has missed the deadlines for a reduction lawsuit and cannot file a reduction lawsuit can assert the reduction as a defense against claims directed against them. However, this defense cannot be raised by the beneficiary of the transfer against every claim directed at the reserved heir. It can only be raised against claims by the beneficiary of the transfer seeking the transfer of the property or money directly based on this transfer. In other words, once the claims subject to reduction have been fulfilled, the reduction defense cannot be raised against other claims.
The reduction defense must be explicitly raised by the reserved share heir in the lawsuit filed against them, as it is not considered by the judge. If a lawsuit is filed against more than one reserved share heir, this defense is only effective in favor of the party raising it. Raising the reduction defense is not subject to any time limit. However, explicit or implicit waiver of this defense is possible.