Lifetime Maintenance Agreements in Serbia

Before entering into a lifetime maintenance agreement, two separate questions need to be resolved: what assistance the recipient actually needs, and which assets they are entitled to dispose of. The first requires a discussion about daily life, health and the parties’ expectations. The second calls for an examination of ownership, matrimonial property rights and any earlier dealings with the assets.

An agreement that describes an apartment meticulously but reduces the care obligations to a single general sentence leaves the central relationship inadequately defined. The reverse is equally problematic: detailed care provisions cannot remedy a failure to establish whether the property belongs exclusively to the recipient.

What the agreement covers and when property is transferred

Under Article 194 of Serbia’s Inheritance Act, the maintenance recipient undertakes that ownership of specifically identified assets, or other rights, will pass to the provider after the recipient’s death. In return, the provider undertakes lifelong maintenance and care, together with funeral arrangements. Only assets and rights existing when the agreement is concluded may be included. A reference to “all present and future property” is therefore not an adequate substitute for identifying the subject matter. ^[1]

The agreement creates obligations during the parties’ lifetimes. What is postponed until the recipient’s death is the agreed transfer of property, not the existence of the maintenance obligations. For real estate, execution of the agreement, recording its existence in the property register and subsequent registration of ownership are separate matters. Article 199 allows the provider to protect their contractual entitlement through a public-register entry. Recording the agreement does not itself register the provider as owner. ^[1]

This statutory arrangement must be distinguished from a transaction transferring ownership immediately in exchange for future maintenance. Serbian case law recognises the latter as an atypical or “non-standard” lifetime maintenance agreement, whose legal character and formal requirements require separate assessment. A gift reserving a lifetime usufruct is also different. Choosing between these arrangements materially affects the protection available to the person arranging their future care. ^[2]

Maintenance obligations and uncertainty

A lifetime maintenance agreement is a bilateral, onerous and aleatory contract. Property is acquired in exchange for the maintenance undertaken, rather than gratuitously. Its aleatory nature lies in the uncertainty surrounding the duration and extent of the obligations. The relationship also depends on trust in the particular provider. These characteristics are recognised in Serbian Supreme Court decisions. ^[3]

The recipient need not be destitute or without a pension. In Rev 15620/2022, decided on 16 November 2023, the Supreme Court explained that substantial wealth and sufficient income do not eliminate the need for personal care. On the facts of that case, the agreement with the recipient’s wife served a genuine purpose of securing assistance rather than disguising a gift. ^[3]

The practical question is what the provider actually undertakes. Where the recipient pays ordinary expenses from their pension, the agreement should specify who buys medication, arranges treatment, meets additional care costs and provides day-to-day assistance. It should not state that the provider finances everything unless that is the parties’ real arrangement.

Formal requirements and the notary’s role

Ordinary certification of signatures is insufficient. The agreement must take the form of an instrument confirmed by a public notary through the Serbian procedure known as solemnisation. The notary must specifically warn the parties that the property covered by the agreement will not form part of the recipient’s estate and cannot be used to satisfy compulsory inheritance entitlements. The warning must be recorded in the confirmation clause. Failure to comply with the prescribed requirements renders the agreement void. ^[4]

The notary examines the parties’ capacity and authority, explains the legal consequences and reviews the lawfulness of the transaction. Their role extends beyond identifying the signatories. Confirmation must be refused where the statutory conditions are not satisfied. ^[5]

Where real estate is involved, territorial jurisdiction must also be respected. The Serbian Chamber of Public Notaries’ Expert Council addressed a useful practical point in its opinion of 24 February 2017: a notary who confirmed the original agreement is not automatically competent to confirm every subsequent amendment. The answer depends partly on whether the amendment introduces a new disposition of property or merely clarifies existing obligations. ^[6]

For a person unable to attend because of serious illness or limited mobility, a notarial act may be arranged outside the office under the applicable conditions. The Notarial Rules expressly recognise circumstances involving age, illness, disability and residence in a hospital or care institution. These arrangements should be settled before a final signing date is fixed. ^[7]

An older agreement authenticated by a judge is not defective merely because it lacks modern notarial confirmation. Its form must be assessed under the rules applicable when it was executed, rather than by mechanically applying today’s procedure. ^[3]

The recipient’s capacity and state of health

Preparing the agreement requires two distinct assessments. One concerns whether the recipient understands the transaction and can express a free intention to enter into it. The other concerns whether their condition leaves genuine uncertainty about the future maintenance obligation. A person may retain decision-making capacity while being terminally ill in circumstances that call the agreement’s aleatory character into question. ^[8]

Where there is a genuine concern about capacity, obtaining an appropriate medical assessment in good time is advisable. The assessment should relate to the individual, the particular transaction and the relevant date. It should not be treated as a document that rules out every subsequent challenge.

In Rev 1780/2021, decided on 21 October 2022, a favourable medical assessment at execution did not prevent a subsequent judicial finding that one recipient had been unable to form a free intention or understand the transaction. The court considered medical records and expert evidence when reaching that conclusion. ^[8]

Special rules for professional carers

A separate restriction applies to professional carers. Where the proposed provider already cares for the recipient in the course of their profession or business, prior consent from the competent guardianship authority is required. The legislation identifies medical personnel, hospitals and agencies as examples. An agreement concluded without that consent is void. The relevant issue is the professional care relationship, not merely the provider’s occupation. ^[1]

The recipient’s property and spousal rights

Spousal consent is not a universal requirement for every lifetime maintenance agreement. The need for the spouse’s involvement depends primarily on ownership of the assets being disposed of. A spouse may independently dispose of their separate property, whereas joint matrimonial property is managed and disposed of jointly and by agreement. Registration of real estate in one spouse’s name alone does not necessarily exclude the other spouse’s rights. ^[9]

The review should therefore establish when and how the property was acquired and how its acquisition was funded. Those facts determine whether both spouses must participate, whether appropriate consent is required or whether their property rights should first be clarified.

Particular care is needed where the recipient’s spouse has already died. In Rev 2856/2025, decided on 25 June 2025, the Supreme Court declared the agreement partially void in respect of the half of an apartment attributable to the deceased wife’s matrimonial property rights. An earlier family arrangement did not entitle the recipient to dispose of her share. ^[10]

Recording that the recipient is now widowed is therefore insufficient. The ownership and succession consequences of the earlier marriage must also be examined.

Matrimonial property on the provider’s side

Matrimonial property questions also arise on the provider’s side. Property acquired through maintenance is not automatically the provider’s separate property in the way that an inheritance or gift generally would be. Where maintenance was provided through the spouses’ joint work during their marital community, the acquired assets may constitute joint property even though only one spouse is named as provider. ^[9]

In Rev 15923/2023, decided on 21 December 2023, the court recognised the wife’s entitlement to half of the property acquired under such an agreement. Her actual participation in nursing and everyday assistance was material, notwithstanding her absence from the agreement as a named provider. ^[11]

It is therefore worth establishing at the drafting stage who will perform the obligations and whose resources will be used. Omitting one spouse from the document does not settle the eventual ownership question.

Defining the maintenance obligations

The recipient’s actual circumstances should determine the drafting. Do they live alone? Who obtains food and medication? Is daily attendance required, or occasional assistance? What arrangements will apply if they lose their mobility?

The agreement should address ordinary expenses, medical care and possible admission to a residential facility. It should also clarify whether the provider may engage others for particular tasks, which duties remain personal and how assistance will continue during the provider’s absence. A residential-care provision should not be left as an unrestricted power for the provider, without considering the recipient’s needs and wishes.

Retaining evidence of performance is advisable. Payment records, receipts, care arrangements and relevant correspondence can protect both parties. A later dispute is considerably harder to resolve where the evidence consists only of conflicting recollections within the family.

The estate, compulsory shares and disguised gifts

Property covered by a valid agreement does not form part of the recipient’s estate and is not available to satisfy compulsory inheritance shares, sometimes described as forced-heirship entitlements. The provider acquires under the contract, not by inheritance. Disappointment or opposition among the recipient’s children or other heirs is therefore not enough to set the agreement aside. ^[4]

That does not make every document bearing the title “lifetime maintenance agreement” immune from challenge. Its true nature, validity and performance remain open to examination. An allegation that the arrangement disguises a gift requires proof of simulation and a separate assessment of the concealed transaction. The title of the document does not determine its legal character. ^[12]

Challenging the agreement: nullity and annulment

The expression “overturning the contract” is too imprecise to identify the correct legal claim. Different defects lead to different remedies, different rules on standing and different deadlines.

An agreement may be void because of defective form, unlawfulness, inability to form a legally relevant intention or a specific statutory prohibition. An interested person may invoke nullity, and the court must consider it of its own motion. The right to invoke nullity does not expire. That does not automatically establish that every associated monetary claim is also unrestricted by time. ^[12]

Article 203 of the Inheritance Act allows the recipient’s statutory heirs to seek annulment where illness or age meant that the agreement presented no uncertainty for the provider. The claim must be brought within one year of learning of the agreement and, in any event, within three years of the recipient’s death. The one-year period cannot begin before death. ^[1]

The relevant circumstances are those existing at execution, including what the provider knew. In Rev 3462/2019, decided on 10 February 2021, the court upheld annulment of an agreement made eleven days before the recipient’s death. Advanced malignant disease and the provider’s knowledge of the medical condition were established. Earlier care did not remedy the lack of uncertainty at the relevant time. ^[13]

This does not establish a rule invalidating every agreement followed shortly by death. The circumstances matter, not merely the number of days. Medical records, expert evidence and evidence of the provider’s knowledge are therefore particularly important. ^[13]

Claims based on defects of consent are governed by the Law on Obligations. Its rules provide a one-year period from discovery of the ground of voidability, or cessation of coercion, and an overall three-year period from conclusion of the contract. Those are not the same deadlines as the periods under Article 203 of the Inheritance Act. ^[12]

Before bringing proceedings, counsel should identify what is actually challenged: the recipient’s capacity, the freedom of their consent, the existence of uncertainty or subsequent non-performance. Treating these as interchangeable can have direct procedural consequences.

Termination and non-performance

An agreement validly concluded may later be terminated. The legislation provides for judicial termination where the parties’ relationship becomes intolerable and for adjustment or termination following a sufficiently substantial change of circumstances. Conversion into a lifetime annuity requires the parties’ agreement. Termination can also raise questions of reimbursement for maintenance already provided and compensation for loss. ^[14]

For non-performance, Rev 11920/2024, decided on 29 August 2024, is particularly relevant. The Supreme Court emphasised that termination for failure to perform requires a judicial decision. After the recipient’s death, statutory and testamentary heirs may seek termination if the grounds had arisen during the recipient’s lifetime. A person claiming the same property under a later maintenance agreement does not acquire equivalent standing merely on that basis. ^[15]

A unilateral “revocation” letter or the execution of another agreement should therefore not be treated as proof that the original arrangement has ended. Where an agreed solution is unavailable, the appropriate proceedings should be brought in time, supported by evidence of the alleged grounds for termination. ^[15]

The provider’s death and the surviving recipient

The provider’s obligations do not automatically pass to every heir. A special right to continue the arrangement belongs to the spouse and descendants called to inherit, provided they agree. In its opinion of 25 July 2018, the Serbian Chamber of Public Notaries’ Expert Council explained that this succession is established in the provider’s probate proceedings, rather than necessarily through a new amendment signed with the recipient. ^[16]

The legislation distinguishes refusal to continue from inability to assume the obligations. That distinction affects entitlement to compensation for maintenance previously provided. ^[1]

Where two recipients are protected by the agreement, the surviving recipient’s position should be expressly addressed: continued care, use of the home and the timing of transfers of particular rights. The first death should not leave the survivor facing an avoidable dispute over what remains secured.

Tax and costs

A real-estate transfer under this arrangement falls within the rules on transfer tax, at 2.5%, subject to statutory exemptions. The provider is the taxpayer, and liability generally arises on the recipient’s death. The exemption for a spouse or person in the first inheritance order covers the portion they would have inherited had succession opened on the date of the agreement. Family relationship therefore does not necessarily exempt the entire property. ^[17]

An estimate of notarial and related costs should be obtained before signing, particularly where an off-site appointment, additional documents or prior clarification of ownership is required.

Preparation and evidence of performance

Preparation should bring together the ownership documents, an accurate account of matrimonial and family circumstances and a workable agreement on care. Where the recipient’s condition calls for it, appropriate medical assessment should also be obtained. Following execution, the necessary registration steps should be completed and evidence of performance retained.

The quality of the agreement depends on these preparations. The recipient should understand who will provide care if assistance becomes necessary every day. The provider should understand the obligations being assumed and the assets that may lawfully be acquired in return. Notarial confirmation cannot, by itself, supply answers that the parties have left unresolved.

Lifetime Maintenance Agreements in Serbia: Requirements and Risks