A review of:
Fiala / Nerb (eds.) Investments for wards and persons under guardianship
Legal and financial mathematical basics for guardians and custodians Bundesanzeiger Verlag, Cologne 2003, 166 pages, 29.80 E ISBN 3-8981 7-280-5 www.bundesanzeiger.de
It does not require any particular imagination to realise that the demographic factor, which has a major influence on the current pension discussion, will naturally also increase the importance of guardianship. In a country in which people are getting older and older and the assets of old people are increasing – irrespective of economic fluctuations – the number of guardianships – in other words: asset management for third parties – must grow. Anyone who has ever had to deal with the problems associated with guardianship, whether for professional or private reasons, will be grateful for this work. But not only this: the work is a very useful and helpful “Vademecum” to understand the different investment forms and weigh advantagesIRisiken. The authors begin by setting out, in a readily understandable way, the legal basis of the “corridor” within which the guardian can move in managing assets when it comes to investing for the person under guardianship ($3 1805 et seq., 181 1 BGB). For this alone, praise is due, as the regulations and especially the practice of the guardianship courts are not always easy to understand even for trained lawyers. The authors themselves point out that judicial guardianship training in the .area of property law issues is treated only very stepmotherly, and explain by means of a practical example the difficulties they were exposed to in suggesting a property investment that was ‘permissible and sensible from a legal point of view. The work contains a list of those courts which, according to the so-called ‘ward money list’, have held certain securities funds to be permissible. This list of the Bundesverband Deutscher Investment- und Vermögensverwaltungs-Gesellschaften e.V. (Federal Association of German Investment and Asset Management Companies) comprises approximately 300 decisions, which are certainly not known to many legal guardians. On the other hand, the guardian will often be confronted with considerable friendly pressure from the principal bank of the person being guardianed; it is not uncommon for clerks to give incorrect legal advice out of self-interest so that investments with a high commission rate are not withdrawn. The authors’ comment can be applied to the relevant legal commentary: one has the impression that in the legal literature the property law aspect is only touched on in passing because family law and procedural law aspects are more familiar. In fact, however, the property law aspects will play a much more significant role in the case of higher estates. In the other sections of their work, the authors shed light on the various forms of investment that come into question under guardianship law, draw up a system of financial investments and outline the basics of financial mathematics. If this sounds all too dry to you, you may want to take a look at the remarks on “Fallacies of or by ‘financial acrobats'” (pp. 105, 106). Also worth reading are the comments on the liability of the guardian. Not everyone will be aware that simply doing nothing, i.e. leaving assets with the financial institution and in the form of investment that the person under guardianship himself had chosen, is already liable; but precisely when the guardian takes his function seriously, does not see himself as an auxiliary organ of the guardianship court and chooses a form of investment other than the unavoidable Federal certificates of deposit, he exposes himself to a risk that needs to be considered. This applies without reservation to his legal adviser. Overall impression: The work is to be recommended without reservation for concerning and practical men. The price of the book is – p,measured by the superficially rather manageable potential readership, i.e. the probably rather small first edition – pleasingly low.
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About the author
Dr. Johannes Fiala has been working for more than 25 years as a lawyer and attorney with his own law firm in Munich. He is intensively involved in real estate, financial law, tax and insurance law. The numerous stages of his professional career enable him to provide his clients with comprehensive advice and to act as a lawyer in the event of disputes.
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