A German court has rejected a demand for the return of thousands of acres of land to the family of an anti-Nazi aristocrat who was tortured by the Gestapo and stripped of all his property as punishment for taking part in the abortive Second World War plot to assassinate Adolf Hitler.

Prince Friedrich zu Solms-Baruth was one of a handful of German aristocrats who took part in the failed attempt to blow up the Nazi leader on 20 July 1944. The Gestapo arrested him the next day and forced him to sign a legal contract formally handing over 17,300 acres of family estates and castles to Heinrich Himmler, the Gestapo chief.

But a legal bid by the Prince's grandson, Prince Friedrich zu Solms-Baruth V, to have the properties returned failed yesterday. A court in the city of Potsdam rejected pleas for their restitution; arguing that the contract which led to their being relinquished to the Gestapo was legal because German law still recognised Nazi Germany as a constitutional state in which the rule of law prevailed.

The verdict provoked a furious response from members of the zu Solms-Baruth family, German legal experts and historians specialising in the Nazi-era. "The court's ruling is outrageous," Prince Friedrich V told The Independent. "My grandfather was coerced into signing away his estates to Himmler. He had to do it to save his own life and that of his family. The whole world knows that the Nazis put a veneer of legality on their criminal activities."

Antony Beevor, the British historian and Nazi-era expert, said the mere fact that the prince's grandfather signed over his estates while being held prisoner in the Gestapo's infamous Berlin headquarters rendered the signature invalid. "It is quite simply unimaginable that a document presented to a prisoner arrested in connection with the 20 July plot could be deemed to have been a contract entered into willingly and without coercion," he said.

The prince's grandfather, a renowned anti-Nazi, joined the so-called "Valkyrie" plot to assassinate Hitler in 1944. His country estates were used as meeting places for the conspirators. In the run-up to the assassination attempt, led by Colonel Claus Schenk Graf von Stauffenberg, he slept in a different room every night with a pistol under his pillow.

The prince was arrested during a Gestapo raid on his estates the day after the failed attempt to blow up Hitler at his "Wolf's Lair" headquarters in Eastern Prussia. He was taken to Gestapo HQ in Berlin where he was held in a cell for weeks and tortured.

After his release, the prince remained banished from his estates under pain of death. He left Germany for Sweden after the Second World War and emigrated to Namibia, where he started farming. As the bulk of the estates confiscated from the family lay in communist East Germany after the war, legal attempts to have them returned were only begun following Germany's reunification in 1990. Most of the family property now officially belongs to the state of Brandenburg and the town of Baruth.