Federal Court Clarifies Distinctions in Property Division: Premature Termination versus Post-Divorce Settlement

With a ruling dated November 22, 2023 (Case No. XII ZB 386/22), the Federal Court of Germany has provided clarity on the issue of property division. The essence of the decision lies in distinguishing between the premature division of property, as governed by § 1385 BGB, and the property division following a divorce. This distinction follows the rationale of a previous Senate decision from June 26, 2019 (Case No. XII ZB 299/18), which already highlighted the difference between these two procedures.

The case at hand involved a tiered application for property division after divorce, filed within the divorce proceedings context. The Federal Court’s pivotal guidance indicates that such an application becomes unfounded once the joint property regime has been prematurely dissolved in a separate proceeding. This offers the applicant the option to address this change by filing a declaration of completion regarding the property division claim after the divorce.

This decision sheds light on the critical differences in family law and emphasizes the importance of precise and strategically considered application submissions. Thanks to the Federal Court’s clear stance, both litigants and their advisors are provided with a solid foundation for handling similar cases in the future, thereby strengthening legal certainty in the area of property division.