Under the private property system, even if the decedent disposes of property gratuitously during his or her lifetime, the heirs can still assert their rights by exercising the legally guaranteed right of residuary interest after the commencement of inheritance. The right of residuary interest guarantees the heirs a minimum amount of property to inherit, allowing them to recover some of the property that was disposed of for free, thereby ensuring a fair distribution of the inheritance.
Under a private property system, everyone is free to dispose of their property. There are many ways to dispose of property, but gratuitous dispositions, such as donations, require special attention. This is because gratuitous dispositions, such as donations, can be made freely while the owner of the property is alive, but the situation changes when the owner dies. When inheritance begins, heirs can assert their rights guaranteed by law, which may result in the gratuitous disposition being reversed.
When the gratuitous disposer dies, the inheritance begins, and his heirs can exercise their right to the return of the oil, known as the right of reversion. The right of residuary interest is intended to ensure that the heirs receive the minimum amount of property they are entitled to inherit. It allows the heirs to compensate for any reduction in their inheritance due to the gratuitous disposition of the decedent. The gratuitous disposer then becomes the decedent and his rights and obligations are transferred to the heirs.
The residue is the portion of the benefit that the heirs would have inherited in the absence of the gratuitous disposition. If the heirs are only one of the decedent’s children, they are guaranteed only one-half of the interest that they would have inherited. The amount that the heirs could have inherited is calculated by adding the value of the property that the decedent had at the beginning of the inheritance to the value of the property that has already passed to a gratuitous acquirer. The residuary interest is intended to protect the heirs’ expected benefit.
The reason for exercising the right of remainder during an inheritance is to maximize the amount of property that the heirs will receive upon the decedent’s death. If the decedent disposed of a lot of property for free during his or her lifetime, the heirs will inherit less. In such a situation, the heirs can exercise the right of residuary interest to get back some of the property that was disposed of for free.
An heir with an inherited interest in property that the decedent had when the inheritance began is entitled to only a portion of the inherited interest. This is because they can only get back the value of the deficiency, which is the value of the interest minus the interest they already inherited. The value of the deficiency is calculated as a monetary amount, but it is not always returned as money. If the property disposed of for free is not money, but property other than money, such as goods or stocks, the property itself is subject to return. However, if it is not possible to return the property itself, the gratuitous acquirer must return it in money. Also, even if it is possible to return the property itself, it may be returned in money by agreement between the right holder and the gratuitous acquirer.
If the gratuitously disposed of property is an object, what is the form of return of the freehold? If the amount of the freehold deficiency owed by the gratuitous acquirer is less than the value of the gratuitously disposed of object, the freehold holder is entitled to receive from the gratuitous acquirer the proportion of the freehold deficiency that is equal to the value of the object. This divides the ownership of an item among several people, each of whom has a share, called a share. In the process of dividing the shares, a fair distribution must be made to maximize the rights of each heir.
If the market value of a gratuitously disposed of item fluctuates, which market value should be used to calculate the deficiency? For the purposes of the gift tax, the market value at the inception of the inheritance should be used. However, if the increase in the value of the item is due to the efforts of the gratuitous acquirer, the value should be calculated based on the value at the time of the gratuitous acquisition. When calculating the share to be returned based on the deficiency, the market value at the time of inheritance must be used as the basis, regardless of the cause of the increase in market value.
Thus, while the private property system guarantees freedom of disposition of property, it is not always free, especially when considering inheritance and the issue of undivided shares. It is important to understand the legal procedures and heirs’ rights regarding the disposition of property. The right of descent is a device to protect the legitimate rights of heirs, minimizing the loss of property due to the gratuitous disposition of the decedent and preserving the expected benefit of the heirs. It allows the heirs to assert their rights to the property even after the death of the decedent.
