Buying a donation house in Italy, what are the risks and how to avoid them

Buying a home from a vendor who has received a donation may be risky and the bank may not grant the loan. Let’s see why and how, thanks to a recent decision, it is possible to avoid problems.

Donation may be contested within 20 years of being transcribed or within 10 years of the donor’s death. A long time. And with the protest the heir can recover the given property, even if his property has already been transferred. In order to protect the gift, the heir may waive the action by signing an official document when the donor is still alive.
To clarify it there is the judgment of the Court of Pescara n. 250/2017. This decision is based on what has already been expressed by the Court of Turin (Judgment No. 2298/2014). In the case of a donation, it is therefore good to defend oneself against the heirs and their actions.

First of all, it should be remembered that the person who gives a home to a parent or a third party performs an act that could harm the so-called legitimate heirs, to whom Italian law always grants a minimal share of the estate of the deceased, even in spite of his will. They are the spouses, their children, the parents and the brothers and sisters of the deceased. This means that if a person, while still alive, make donations depleting his assets, or with his will, leaves most of his property to persons other than the legitimate heirs, they may experience the so-called “action of reduction of the legitimate part “.

The action aims to recover the part of the inheritance that is due to them by law. In this way, those who benefit from a donation of the deceased are obliged to return the property to the heirs even after the transfer of ownership in their favor. Not only that. If the donor sells the property to another person, the lattermay also be the subject of the heirs reduction action and, therefore, be obliged to return the property to the legitimate ones.

The reduction action can no longer be experienced beyond a certain term. The right of the heirs to recover the property dumped from the estate of the deceased, who damaged their rights,  prescribes alternatively under: 20 years from the transcription of the donation in the public register; 10 years from the opening of the succession, that is to say the death of the donor. After this period, if no action is taken, the gift becomes unassailable.

But the practice of the notary has developed a faster solution, validated now by the judges. It is a question of having the legitimate heir sign a waiver to contest the donation: he thus undertakes not to proceed with the restitution of the property. If the legitimate heirs are more than one, the signature must be collected by everyone. The waiver can be signed when the donor is still alive, that is, shortly after the donation itself.

The judgment states that the renunciation of the legitimate heir to the action of restitution of the given property is valid even if it is completed before the death of the donor and before 20 years from the transcription of the donation. If made with a notary act, it can be noted in the real estate registers on the sidelines of the donation in order to be public and knowable by anyone.

It is necessary to emphasize however that with this agreement the legitimate heir does not lose its legitimate part, that he can always claim also against the donor; he undertakes not to claim the object of the agreement, without prejudice to the possibility of defending his rights in a different way.

Therefore, the situations that may arise are as follows: if the donor is still alive, the legitimate heir can only give up the action to recover the property, it means that he will no longer be able to claim the property object of worship, but can still act against the donor to obtain (in a different way) his legitimate share. If the donor is dead, the legitimate heir may renounce both the action to obtain restitution of the property, and the action of reduction of the legitimate share.