This theoretical study addresses the experimentally known fact that the ligand system 1-(2-(diphenylphosphino)benzylidene)-2-phenylhydrazine (L) coordinates to palladium centers via the N atom as a 1-methylenehydrazine ligand In the case of platinum, a 1,2-H shift occurs, and a coordination via the C atom of the newly formed 1-carbenehydrazine ligand is observed DFT calculations show that the free 1-methylenehydrazine ligand is favored over the free 1-carbenehydrazine ligand by ca 42 kcal mol(-1). Coordination to a metal center, however, lowers this energy difference to ca. 8-14 kcal mol(-1) in the case of Pd and to essentially zero for Pt.