Allodial and primogeniture rights

The Act concerning Allodial and Primogeniture Rights (Allodial Act) of 28.06.1974 no. 58 gives certain heirs a preferential right to take over an agricultural property when the owner sells the property or dies.

The Allodial Act governs both rights of allodium and primogeniture.

The Act prevents agricultural properties from being sold outside the family and divided up, thus ensuring stability for both family members and the agricultural sector.

A property is considered to be “allodial land” when it is an agricultural property with at least some 10 acres of cultivated land or 125 acres of productive forest. An owner obtains an allodial right when he has owned the property, with full rights of ownership, for 20 years. Once the owner has attained an allodial right, his descendants will also inherit the allodial right to the property.

Dalan has a long tradition of advising clients in this branch of law; a tradition we now carry on with pride.

In contrast with previous legislation (until 1975), an allodial right is no longer possible in properties owned jointly by several persons. So, if a property is jointly taken over and owned, it will as a rule be without allodium. There are, however, certain exceptions to this rule, including the allodial right held by a party to a joint ownership that was established prior to 1975. Such a right may still be valid. Moreover, a joint ownership between spouses and cohabitants, who together have attained a shared allodial right, will still be considered to be an allodial property.

Since 2014 the scope of those entitled to an allodial right has been restricted so that it is now only children and grandchildren who can have an allodial right to a property. There is an additional condition to be met by grandchildren; their grandparent must have been the last person to own the entire property with an allodial right.

Allodial succession is such that elder siblings, by themselves and their lineage, take precedence over younger siblings. This means that the children of the oldest siblings have a stronger allodial right than their aunts and uncles.

“This means that the children of the oldest siblings have a stronger allodial right than their aunts and uncles.”

Spouses and cohabitants who jointly purchase a property (to which neither of them has an allodial right) may attain a shared allodial right with equal priority. But if one of the parties previously had an allodial right to the property, this will prevent the spouse/cohabitant from obtaining a right.

An allodial claim may be advanced if an allodial property is transferred to a new owner who has a weaker allodial right than the claimant. An allodial right can also be claimed against a deceased person’s estate.

The time limit for putting forward an allodial claim is six months after registration of the document (title deed/declaration of legal title) giving the new owner full property ownership rights. It is worth noting that this time limit applies even if the person entitled to the allodium is unaware of the transfer.

Right of primogeniture is, as mentioned above, a unique right entitling lineal descendants (children and grandchildren) to take over a property. A claim can be put forward in connection with probate proceedings and the lineal descendants take over the property at a primogeniture valuation.

If the person with the best claim wishes to take over the allodium of a property, the price to be paid will often be determined by means of an allodial valuation (or primogeniture valuation if the conditions for requesting a discount on grounds of primogeniture are applicable). Such valuations are reached by holding a judicial appraisal process led by a professional judge and several expert assessors.

The initial basis for an allodial valuation is the normal sales price of the property, though on the condition that the property shall be used mainly for agricultural purposes. A primogeniture valuation will proceed from the same initial consideration, but the price assessed shall be “reasonable in view of the existing circumstances”. In practice, this means that in such a valuation the primogeniture right holder is granted a so-called primogeniture discount. Such a discount can vary from zero up to 30% of the full valuation.

As a rule, the costs incurred by the court and the counterparty in an allodial valuation shall be borne by the person who applied for the valuation. As this also applies for the counterparty’s legal and other expert witness expenses, these costs can be substantial. If the valuation is conducted as part of the probate procedure in connection with a deceased’s estate, these costs will as a paid out of the funds in the estate.

The parties will often be best served if they clarify the questions linked to allodial rights before an allodial property is sold to others than the person with the strongest allodial claim.