When Conflict-of-Laws Rules Conflict: The German Federal Court of Justice on the Procedural Requirements for Determining Foreign Law
German Federal Court of Justice (BGH), decision of 24 June 2026 – IV ZB 24/25
Dr Joshua Blach, Julian Hauser and Dr Stefan Hackel analyse the case:
A US national whose last habitual residence was in New York left an estate under a will that included an interest in a German community of heirs holding real property in Munich. One of the key issues was whether a disclaimer of inheritance was valid, which in turn depended on whether German or New York succession law applied.
The Munich Higher Regional Court initially correctly determined the law applicable to the succession under the EU Succession Regulation by reference to the deceased’s last habitual residence and thus applied the law of the State of New York. New York succession law provided for a scission of the estate: immovable property was governed by the substantive law of the place where the property was situated (lex rei sitae), while movable property was governed by the substantive law of the deceased’s last domicile (lex domicilii).
Under New York’s interlocal conflict-of-laws rules, however, the distinction between movable and immovable property was itself to be determined by the substantive rules of the lex rei sitae. This was precisely the point that the appellate court overlooked when determining the content of foreign law pursuant to section 293 of the German Code of Civil Procedure (Zivilprozessordnung – ZPO). Instead of treating this renvoi under US private international law as a reference to substantive law, the court interpreted the reference under US law, by recourse to the EU Succession Regulation, as a reference to the entire legal system, including its conflict-of-laws rules.
The German Federal Court of Justice (Bundesgerichtshof – BGH) held that this constituted an error of law. It reiterated that a German court must apply foreign law as it would be interpreted and applied by a court in the jurisdiction concerned; the lex fori is therefore not determinative. The manner in which the court establishes the content of foreign law is a matter for its sound judicial discretion. Whether that discretion has been exercised without legal error – in particular, whether the court has sufficiently exhausted the available sources of information in light of the circumstances of the individual case – is, however, subject to full review by the appellate court.
Practical takeaway: The decision once again makes clear that, while the determination of foreign law under section 293 ZPO is a matter for the trial court’s sound judicial discretion, the manner in which that discretion is exercised is subject to full appellate review. Errors in determining the content of foreign law may therefore be challenged on appeal.
Parties relying on foreign law – or seeking to challenge its application – should actively contribute to the evidentiary basis on which the court determines its content, for example by submitting qualified expert opinions or legal submissions. Any shortcomings should be raised at an early stage in order to preserve the possibility of challenging them at the next level of appeal.