Limitation of distribution claims from a private foundation

Section 5 of the Austrian Private Foundations Act, or PSG, addresses beneficiary status. It does not by itself establish a specific monetary claim against the foundation. The foundation deed, any supplementary deed, later amendments and the authority of the deciding body must be considered together.

A claim may become sufficiently specific where the recipient, performance, conditions and due date are objectively fixed or adequately defined by a valid resolution. If the board must still decide on the occasion, amount or timing of the payment, there is not automatically an immediately enforceable claim. Repeated earlier payments may be relevant evidence, but they do not replace an examination of the applicable legal basis.

Under section 17 PSG, the foundation board must comply with the foundation deed and may make payments to beneficiaries only if creditors of the private foundation are not prejudiced. These requirements may matter when assessing whether a payment could be resolved and whether objections to its due date exist.

Section 1478 of the Austrian General Civil Code, or ABGB, connects ordinary limitation with the non-use of a right that could already have been exercised. In a distribution case, it is therefore necessary to determine when the claim arose and when payment could have been demanded. A resolution subject to an unmet condition or without a determinable payment date does not answer that question by itself.

Section 1478 ABGB provides a general thirty-year period. This does not mean that every claim against a private foundation is automatically subject to thirty years. A special statutory period, a valid agreement or another legal basis may apply. Section 1486 ABGB lists a three-year period for specific claims, including certain claims for services in a business. That list cannot simply be applied to every foundation distribution.

For practical purposes, recording only the date of a promise or board resolution is not enough. The entry into force of a condition, a specified payment period, a later acknowledgment, partial payment or a new resolution may be decisive.

The first review should be based on a chronological file. Start with the applicable foundation deed and its amendments. Then add the designation of the beneficiary, board resolutions, conditions, payment requests, replies from the foundation and any partial payments.

Where several versions exist, it must be established which deed was effective at the relevant time. A draft, an unresolved resolution or an informal conversation must not be treated as a binding basis. Conversely, a written acknowledgment or an executed partial payment may be important for the timeline.

The file should also include material that weakens the claim, such as reservations, defects in the resolution process, creditor protection, conditions or a different due date. Selecting documents only by the desired outcome can conceal the decisive issue.

Section 1497 ABGB identifies, among other things, an express or implied acknowledgment of the right and the proper continuation of proceedings as events that interrupt limitation. Whether a message from the foundation is an acknowledgment depends on its exact wording and context. An open-ended prospect of a later payment is not necessarily confirmation of an existing debt.

A court step cannot be assessed by its filing date alone. The proceedings must be properly continued within the meaning of section 1497 ABGB. If a final decision declares the action inadmissible, the provision generally treats limitation as uninterrupted. The effect of a particular proceeding must be assessed from the court file and decisions.

An internal reminder, a general request for information or a beneficiary determination should therefore not be treated automatically as a step interrupting limitation. Before a possible period expires, the specific claim and the available procedural step should be reviewed together.

Section 30 PSG concerns information about the fulfillment of the foundation purpose and inspection of certain documents. This right can help clarify resolutions and the development of the foundation assets. It does not replace the examination of whether a specific payment is owed.

Anyone who has so far only requested information should therefore check whether the specific payment claim was also clearly identified. Conversely, the foundation should not treat a specific payment claim as resolved merely because documents were provided. The two issues can be connected, but they remain legally distinct.

The usual order of review is to secure the relevant deed, determine the claim and due date, examine the timeline and limitation issues, and only then choose the appropriate next step.

For a reliable first assessment, the following documents should be collected where available:

• foundation deed, supplementary deed and effective amendments
• designation of the beneficiary and the version on which it is based
• board resolution stating amount, conditions and payment date
• correspondence, payment requests, acknowledgments and partial payments
• documents concerning court proceedings or a settlement
• material concerning creditor protection, objections or counterclaims

The documents should be turned into a short timeline with date, sender, content and legal relevance. This makes it possible to distinguish an expectation from a specific claim, identify when the claim became due and assess any acknowledgment or procedural step afterwards.