Helsingin yliopisto, Helsinki 2006
Sopimus ja kuolinpesän hallinto
Antti Juhani Kolehmainen
Väitöskirja, kesäkuu 2006.
Agreements and administration of a decedent's estate
In this thesis, I shall discuss agreements entered into by parties to a decedent's estate on administration of the estate. These agreements (shareholders' agreements) may cause problems in either the relationships between the shareholders or their relationships with third parties outside the estate. My particular aim is to assess:
(1) how the mutual rights and obligations are arranged once the shareholders have entered into a joint administration agreement, and
(2) what effect a joint administration agreement has when one of the parties in a legal relationship comes from outside the estate.
In addition to actual contracts, I shall discuss situations (agreement-like situations) where acts performed by the parties create new rights and obligations. One example of such a situation is ex post facto ratification (ratihabition). In addition to clarify the contents of the norms, I shall seek to systematize the set of norms concerning shareholders' agreements. Therefore, this study falls within the sphere of legal dogmatics.
In this thesis, I shall particularly focus on the possible effects of the interaction between contractual parties on the legal relations between both the parties to the estate and between the contractual parties and third parties. In this respect, the subject extends to other areas of the Finnish contract doctrine, and the original subject of this study - joint administration agreements - becomes a research tool as well. The purpose of this study is to establish to what extent the interaction between contractual parties (or joint actors) may create, alter or revoke rights and obligations in the same ways as specific declarations of intent.
A particular point of my interest is the dynamic features of the Finnish contract doctrine. For this reason, the starting-point of my study is the hypothesis that a typical agreement on the administration of a decedent's estate and the legal relations created by the agreement forms a process. This hypothesis will be tested in this study.
This study shows that the Finnish contract doctrine, which has largely been created for the purposes of bilateral legal acts related to the sale of movables, does not easily apply to the regulation of continuous contractual relationships such as those discussed in this study. Changes in long-term contractual relations occur only gradually and on a factual level. The status of the agreement which has originally defined the rights and obligations of the shareholders can change with the shareholders' acts (whether these are active or passive). The shareholder's acts may indicate that they no longer consider an original term of the agreement binding on them. As a result of the interaction between the shareholders, internal agreements (of a certain kind) may emerge during the contractual relationship, which will considerably alter the role of the original agreement setting out the norms for the relationships between the shareholders. Accordingly, the shareholders' contractual relationship is a non-static process.
The shareholders' legal positions may also be affected after the conclusion of the contract by changes in the circumstances, in which case the doctrines on excess difficulty or force majeure apply, for instance. Furthermore, the processual nature of the contractual relationship is effected by several flexible norms (Section 36 of the Contracts Act; Chapter 24, Section 5 of the Code of Inheritance; and the principle of fidelity). It can therefore be said that the importance of the declarations of intent (and events at the time of these declarations) underlying the shareholders' rights and obligations and creating contractual relations declines as the interaction between shareholders increases and circumstances change.
The shareholders' legal positions with regard to an undistributed estate are thus determined on the basis of a very broad range of material. In some cases, such material implies an agreement or authorization between the shareholders (or between the estate and third parties). Occasionally, such agreements or authorizations imply an ex post facto ratification (ratihabition). In some rare cases, the shareholders or the decedent's estate have, under certain facts and circumstances, incurred an obligation under Chapter 18, Section 3 of the Code of Commerce to pay compensation for the benefit gained. Considering that an obligation incurred by a decedent's estate or the shareholders of a decedent's estate may often be based on other facts in law than a specific agreement, we could, similarly to Kurt Grönfors, call this a case of facts giving rise to an obligation.
Facts giving rise to an obligation often affect contractual relationships even where they do not lead to an actual contract. Ratihabition, for instance, is often evidenced by the parties' actions rather than their specific declarations of intent. A commitment (of which entering a contract is also an example) may be a process which consists of a continuum of facts in law. Sometimes (although rarely) an obligation may emerge even without the principal being aware of a party's lack of authority to perform an act (Chapter 18, Section 3 of the Code of Commerce). If the principal is aware of an unauthorized act but does not respond to it in any way, this may imply that the act has their ex post facto ratification. An active act performed by a party may directly create an agreement or a comparable state of affairs. We could therefore see a commitment as a process and speak of facts establishing an obligation.
Examining whether acts performed by shareholders have created an agreement requires considering the type of the agreement. For instance, the facts and circumstances referring to leaving an estate undistributed (joint administration agreement) can reasonably be expected to manifest a clear intention of a commitment. Leaving an estate undistributed is usually a very significant legal act for the shareholders as it deprives them of an opportunity to place the estate under an administrator or have the estate distributed during the life of the agreement.
The situation is different if there is already undeniably a joint administration agreement between the shareholders and the problem is whether the shareholders can be considered to have altered their contractual relationship through an internal agreement. The legal situation created by a joint distribution agreement (and sometimes administration under Chapter 18 of the Code of Inheritance) must often be given a specific meaning. A successful determination of a rational meaning which corresponds best to the shareholders' intentions usually requires a low threshold for agreements. In practice, this specifically means that other acts of the shareholders than actual declarations of intent may gain significance easier when internal agreements are considered. This will also emphasize the processual nature of the contractual relationship between the shareholders.
An ex post facto ratification of a legal act constitutes a recognition of the binding nature of that act. Unlike a contract, such a ratification is not future-oriented; it does not imply that any other future acts of the other party will be accepted as well. Consequently, the emergence of a ratification is based on lighter facts and circumstances than an agreement. The same applies for authorization. Because the authorizing party always has the option of revoking the authorization, an authorization is less restrictive on a principal's freedom of action than a contract. Paying compensation for benefit gained is the least compelling of the above obligations. It may have all the constituent elements of an obligation even if the act performed by the party showed no intention of a commitment. After all, in the case of compensation for benefit, 'principals' are bound by other parties' legal acts only to the extent of the benefit they may gain from it. If that benefit is less than the commitment, the obligation is limited to the amount of the benefit, or the amount of the enrichment.
Whether any of the constituent elements referred to by the legal institutions mentioned above exist cannot be determined on the basis of a single legal act. Examination of social contractual relationships such as decedent's estates requires a more than atomistic approach. If the contract as a whole and the operating environment are taken into account in the legal acts performed by the parties in their contractual relationships, exclusion of such aspects when judicial decisions are being made will easily lead to an outcome which the parties have not anticipated at all, and the contract(s) will have failed to provide and ensure the stability and predictability expected from it. This study shows that, for the dynamics of the relationship between the contracting parties, the processual nature of a contractual relationship has more weight than that of an agreement (if the actual agreement is defined as a set of facts that consist of declarations of intent creating certain rights and obligations; in other words, defined as a legal act).
Because of the above legal institutions, the shareholders' right and obligations cannot be considered static. This is illustrated by the main claim of my thesis: joint administration should not examined in the light of the norms of the Code of Inheritance and the principle of joint administration alone. As joint administration continues and cooperation increases, the rules of contract law gain more weight in joint administration. To this day, joint administration has been rather too narrowly considered a problem in the application of the Code of Inheritance, particularly Chapter 18, Section 2, which concerns the principle of joint administration.
The following remark on joint administration agreements is also related to the main claim of my thesis: While the time when the declarations of intent which establish the original contractual relationship (non-distribution agreement) are made still remains the key moment for determining the shareholders' rights and obligations, the significance of that moment for shareholders' agreements is lower than usual; in this case, applying the time of the declarations of intent as the main systemic rule for determining the moment when legal consequences begin is clearly a weaker rule than in the case of a sale of movables, for instance. With regard to shareholders' agreements (and other long-term agreements), judicial decisions should be made in a manner which involves the option of departing from the main rule referred to above if it is evident from the parties' actions that they had not intended to fix their mutual rights and obligations to that specific time.
Julkaisu on tekijänoikeussäännösten alainen. Teosta voi lukea ja tulostaa henkilökohtaista käyttöä varten. Käyttö kaupallisiin tarkoituksiin on kielletty.
© Helsingin yliopisto 2006
Viimeksi päivitetty 26.05.2006