The Marović Law Office provides comprehensive legal assistance regarding lifetime property distribution agreements, drawing on over 30 years of experience in contract law and inheritance law.
A lifetime property transfer and distribution agreement is a contract by which an ancestor (transferor) transfers and distributes their property to descendants during their lifetime. In this way, the transferor independently manages the disposition of their property, and the descendants know their rights and obligations in advance.
The transferor may reserve a life estate (usufruct) for themselves, their spouse, or a third party on all or some of the transferred assets, may stipulate a life annuity in kind or cash, lifetime support, or other compensation.
Due to its specific characteristics and legal effects, this agreement is governed by the Law on Inheritance, not the Law on Obligations
A lifetime property transfer and distribution agreement must be in written form and notarized before a public notary in the form of a solemnized deed.
Notarization is necessary because it most often involves the transfer of real estate, for which a solemnized contract is required, and also because the public notary must inform the contracting parties that the transferred property does not enter the transferor’s estate and cannot be used to satisfy claims of forced heirs.
The law explicitly provides that transferred property does not enter the transferor’s estate.
The subject matter of this agreement can only be the transferor’s property that exists at the time of execution, and it is prohibited to agree upon the distribution of property that would be found in the transferor’s estate.
A lifetime property transfer and distribution agreement is valid only if all of the transferor’s descendants who would be called to inherit under the law have consented to it, i.e., persons who are his statutory heirs and who would be called upon after the commencement and opening of probate proceedings.
If it happens that a descendant did not give consent to the transfer and distribution of property, they may give it subsequently.
The agreement is also valid if a descendant who did not give consent dies before the transferor, or renounces the inheritance, or is deemed unworthy and leaves no descendants of their own.
In addition to descendants, a spouse may also be included in the agreement, and if they consent, they have the same status as the descendants.
Although property is transferred to descendants, they are not liable for the transferor’s debts unless expressly stipulated in the agreement.
You should contact a lawyer before entering into any lifetime property transfer and distribution agreement, as this is the only way to ensure that the agreement is legally valid and fully protects the interests of the contracting parties. Legal advice is particularly important:
No, the law explicitly provides that transferred property does not enter the transferor’s estate.
Yes, the transferor may transfer property to one descendant or some of them, but the consent of all statutory descendants is required for validity.
Yes, you can dispose of real estate and still live in it. However, you must stipulate the right of use and the possibility of remaining in the property.
A gift agreement transfers property from the donor to the donee without consideration, while a lifetime property transfer and distribution agreement allows the transferor to transfer or distribute property to other persons during their lifetime, usually with certain conditions and rights defined in the agreement itself, such as the right of usufruct or support.
Yes, lifetime property transfer and distribution agreements must be notarized before a public notary; solemnization of the agreement is required.
A lifetime property transfer and distribution agreement may be challenged after the transferor’s death, but only under certain conditions, such as the existence of evidence of fraud, threats, or violation of the legal rights of forced heirs.
The descendant pays the gift or property transfer tax. The amount of tax depends on the value of the property, the relationship between the transferor and recipient, and specific provisions of the Law on Transfer Taxes.
Yes, the transferor may revoke this agreement at any time if the descendant has shown “gross ingratitude” toward them or another person whose support was stipulated, or if they fail to settle the transferor’s debts as agreed. In that case, the descendant is obligated to return what they received.
If the descendant has not fulfilled some other obligation under the agreement, the court will decide whether the transferor has the right to a return or the right to seek enforcement of that obligation, taking into account the importance of that obligation to the transferor and other circumstances
Yes, lifetime property transfer and distribution agreements may be terminated or amended, but only with the consent of all contracting parties, and all amendments must be in written form and notarized before a public notary.
A lifetime property transfer and distribution agreement does not include debts unless the contracting parties explicitly define this in the agreement. If the transferor has debts, they will not pass to the descendants unless expressly stipulated.
A user of property (e.g., holder of a usufruct right) has the right to use the property and enjoy its fruits (rent, lease income, etc.), but cannot dispose of or sell the property without the owner’s consent. These rights last as long as they are in accordance with the agreement and legislation.
Korisnik imovine (npr. korisnik prava plodouživanja) ima pravo da koristi imovinu i ostvaruje njene plodove (rentu, prihod od zakupa i sl.), ali ne može raspolagati imovinom ili je prodati bez saglasnosti vlasnika. Ova prava traju dok su u skladu sa ugovorom i zakonodavstvom.
Yes, if the agreement was signed under duress, threats, or fraud, it may be annulled based on a lawsuit for defect of will. These actions lead to voidability of the agreement because the contracting party did not enter into the agreement by free will.
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Disclaimer: The content of this text is for informational purposes only and does not constitute legal advice. While we strive to ensure that the information is accurate and up-to-date, each situation has its own specifics and requires individual legal assessment. For accurate and reliable advice regarding your specific case, it is recommended that you consult with a lawyer.
Last updated: November 11, 2025.
