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There is a property that was partly being used for residential purpose (first floor) and partly for renting to business entities (ground floor).

The sole owner of the property (property is self-earned) dies intestate and his next of kin are alive but there is no succession certificate mentioning his successors, also, there is a dispute among them about the inheritance of the property (sole owner’s daughters vs sons)

So, all in all, it's not known as to who exactly owns the property and the ownership title of the same is still in the name the sole owner who died.

To whom are the tenants supposed to pay the rent?

One of the businesses has denied paying rent to anyone unless the ownership has been finalized and is accruing the rent payment for the time being, it will pay it all in one go once the ownership has been finalized.

The other businesses are paying rent to the ones who have been living on the first floor, this includes only the sole owner's son and his family.

PS. The answer sought for this question is in context of the Indian Laws. The floors were mentioned only for clarity.

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  • "property is self-earned" I'm not familiar with this term. Does this mean not inherited and purchased with the owner's own money? The religion of the person who died would matter. As a stopgap, the disputing family member should agree on someone to collect rent and hold it in escrow or something until the ownership issue can be resolved.
    – ohwilleke
    Commented Jun 19 at 14:19
  • The somewhat confusing civil-law tag is removed and the probate tag is added, because civil law refers to the civil-law legal systems in opposition to the common law legal system of England and its former colonies including India. The tag does not refer to non-criminal matters.
    – ohwilleke
    Commented Jun 19 at 14:48
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    @ohwilleke civil-law vs Civil-legal-system.
    – Trish
    Commented Jun 19 at 17:59
  • Too late now, but this is why it's usually best to create a corporation for this purpose.
    – Barmar
    Commented Jun 19 at 21:02
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    In many legal systems, there would be an executor or personal representative for the estate of the deceased owner, who would be responsible for receiving things like rent payments and depositing them into an estate account, which will eventually be distributed among the proper heirs once a court determines who they are. The tenants wouldn't have to worry about this; often they can just keep sending checks payable to the deceased owner, as if they were still alive, and the executor sorts it all out. Does this concept not exist in Indian law?
    – Nate Eldredge
    Commented Jun 19 at 21:50

1 Answer 1

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Alice's Property

For simplicity, assume Alice had the children Bob, Charly and Dorothy, she owned the house fully at the time of death, and there are no lingering debts or contracts.

Now, the three own the house and anything Alice once owned jointly as inheritor community (Erbengemeinschaft) to equal parts. The same goes for the company once owned by Alice.

If the three can't deal with it together, there is the option to buy-out the other inheritors or to split it in parts they deem equal. If they can't determine the worth of the parts together, the inheritance court can have that done and mandate that they make earnest offers to buy the others out. As the last option, if nobody can bring up the money, the court can mandate a sale and split the proceeds by all inheritors.

Alice's renters

Now, Alice did rent out some part of the house. The renters are obligated to pay the rent.

Until the account of Alice is closed, that account is part of the inheritance and one proper target for rent payments till the ownership is solved. A change of the payment target for rent is only valid under German law, if the inheritor can prove that he is entitled to the rent payment, for example by proving that he inherited the property with a paper from the inheritance court. That paper would also list who else is part of the inheritance group, and then it would require a signed slip from all inheritors that they agree that the new account is proper.

Now, it gets tricky if Alice's account is closed and still rent is due. In that case, the renter is still obligated to pay, but he can fulfill this duty by having the rent deposited at the court under § 372 BGB. Technically that money enters an escrow account bound to the inheritance. The only further obligation of the renter is to point the possible landlords to get the inheritance in order to recieve their rent from the court. The escrow account is handled as part of the inheritance and payed out to the proper recipient once that is established.

As an interesting point: until the inheritance is solved, any attempt of an inheritor to unilaterally end the lease is void unless the inheritance court agrees to it. The court also can stand in to receive a breaking of the lease if it is unclear if or who is the proper inheritor.

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