Facts
The B. Foundation was established in 1980 by A.A. The Foundation Council consists of a maximum of seven members, who are appointed by the founder or his descendants. In 2013, the founder's descendants, C.A. and D.A., applied to join the Foundation Council. The Foundation Council rejected the application and adopted new foundation statutes, which transferred the authority to appoint Foundation Council members to the Foundation Council itself. The descendants appealed and claimed that the founder was no longer capable of judgment. The Federal Supervisory Authority for Foundations (ESA) found that the founder was no longer able to exercise the authority to appoint Foundation Council members and transferred this authority to the descendants.
The foundation and the founder appealed against the ESA's decision. The Federal Administrative Court dismissed the appeals and confirmed the legality of the election of the Foundation Council by the descendants. The foundation and the founder have appealed against the judgment of the Federal Administrative Court.
Considerations
The Federal Court dismissed the appeals. It found that the foundation supervisory authority has the power to monitor the foundation and ensure that the foundation assets are used for their intended purposes. The authority to appoint Foundation Council members is an important element of foundation supervision.
The Federal Court also found that the founder is no longer capable of judgment to exercise the authority to appoint Foundation Council members. It evaluated the evidence and concluded that the founder suffers from dementia, which impairs his…