* The original version of the present article is published in Volume VII of the collective work “Studies on International Law”, 2012, issued by the International Law Association – Bulgarian Branch. This summary is published with the kind permission of the International Law Association – Bulgarian Branch.
The legal issues relating to succession with international elements are numerous and complex. Considering the significant discrepancies between the private international law frameworks of the Member states regarding that matter, Regulation (EU) 650/2012 was adopted which as from 2015 will regulate the competent court, applicable law and recognition of judgments pertaining to succession with international elements. Until then, it will continue to be under the national regulatory regime of the Member states.
I. The existing legal framework of international legal relations in the area of succession in Germany, England and France
a) German international inheritance law
In respect of the applicable law relating to succession, a “unitarian” approach has been adopted in German law, namely, that succession shall be governed by the law of the state to which the deceased belonged at his/her death, i.e. by the law of the state of nationality. The said connecting factor is applicable as concerns all objects included in the estate of the deceased, regardless of their essence, location and connection to the deceased’s personality. It is subject to one important exception. Where immovable property which belongs to the estate of the deceased is situated on the territory of a state whose substantive law subjects the inheritance regarding that property exclusively to the law of the state where it is located, a “split” of the estate occurs: the immovable property in the respective state is treated as a separate part of the rest of the estate and succession to it is subjected to the law of the state where it are situated1. Where reference to a foreign legal system is made, the German conflict-of-laws provisions abide by the principle of single renvoi.
Pursuant to Art. 25, §2 of theEinfuehrungsgesetz zu Buergerlichen Gesetzbuch (EGBGB),the deceased may during his/her lifetime select German substantive inheritance law as applicable law in respect of his/her immovable property located in Gemany.
According to Art. 26 EGBGB, which follows the solutions of the Hague Convention of 5 October 1961 on the Conflicts of Laws relating to the Form of Testamentary Dispositions (ratified by Germany), a will is formally validif it complies with at least: a) the formal requirements of the law of the place where the testator had his domicile/habitual residence, whether at the time of executing the will or at the time of death; b) the formal requirements of the law of the place where the testator made his will; c) the formal requirements of the law of the state to which the testator belonged, whether at the time of executing the will or at the time of death; d) the formal requirements of the law of the place where the immovable property is situated, as far as the will is concerned with such property; e) the formal requirements of the law which applies to the succession on death or which would have been applicable at the time of making the will.
b) English international inheritance law
The objectively applicable inheritance law in the English legal system has adopted a “scissionist” approach – the applicable law in respect of immovable property is the law of the state where it is situated, and the law applicable in respect of movable things is the law of the state where the habitual residence of the deceased at the time of his/her death was. The recognition of wills with international elements is dependant, pursuant to the Wills Act 1963, on the execution of the will in formal compliance with: 1. The law of the state where the asset disposed of by the will is situated; 2. The law of the state where the deceased was domiciled or had his habitual residence (whether at the time of executing the will or at the time of the testator’ death); or 3. The law of the state whose national the testator was (whether at the time of executing the will or at the time of the testator’ death)2. Through the adoption of the cited provisions, the ratification of the 1961 Hague Convention was accomplished by England.
c) French international inheritance law
French law, like English law, abides by the principle of separate treatment of immovable and immovable property as objects of succession: succession to the right of ownership on immovable things is subjected to the law of the state where the immovable thing is situated, whereas succession to movables is subjected to the law of the state where the habitual residence of the deceased was at the time of death. Recognition of testamentary dispositions with an international element according to French international law is also subjected to the Hague Convention.
II. The New Community regulation of international inheritance legal relations
From August 2015 onward, a unified legal framework regarding inheritance relations with international elements within the European Union becomes effective, incorporated in Regulation (EU) 650/2012 on jurisdiction, applicable law, recognition and enforcement of decisions and authentic instruments in matters of succession and the creation of a European Certificate of Succession(OB L 201, 27.7.2012).
The applicable law in the area of succession with international elements will be the domestic law of the state where the deceased had his/her habitual residence at the time of death, unless it is clear that at the time of death the deceased was manifestly more closelyconnected with another state, whose law will then apply. The connecting factor adopted by the European legislator – “habitual residence of the deceased”, has a unitarian (unified) nature, i. e. the said factor will be applicable to succession as a whole, in respect of all elements which constitute the estate of the deceased. The widely recognized criterion “lex rei sitae” is forsaken. Of high importance as regards the applicable law is the circumstance that the reference to the law of a member state only includes its substantive provisions in the field of inheritance, without its conflict-of-laws rules (per argumentum a contrario derived from Art. 34 of the Regulation).
Regulation (EU) 650/2012 allows within certain limits the exercise of autonomy of the will in respect of the proper law. The deceased will have the right to choose as applicable law in respect of his/her succession the law of the state of their nationality, either at the time of making the choice or at the time of death (depending on the deceased’s express desire) – Art. 22, p. 1 of the Regulation.To be valid, the said choice should be in compliance with the specific formal requirements relating to the manner of its execution. In particular, it will either: /1/ Be made by way of a unilateral written expression of will in the form of a disposition of property upon death, or /2/ Be demonstrated by the terms of the disposition upon death. Regardless of the form in which the choice of applicable law has been made, its substantive validity shall be judged on the basis of the law chosen as applicable law to succession (Art. 22, p. 3). It is namely the chosen law which will be the legal source on the basis of which the capacity of the person making the choice will be assessed. The formal validity of the choice of applicable law, on the other hand, will be appreciated on the basis of any of the national legal systems envisaged in Art. 27, p. 1 of the Regulation, i. e. its formal validity will be dependant on the formal validity of the testamentary disposition by way of which the choice has been made or into which the choice has been incorporated, because that type of disposition is the mandatory and indispensable legal form in which the choice of law must be made. The meaning which the terms “substantive validity” and “formal validity” have, is analogous to that in which they are used in relation to dispositions mortis causa.
The applicable law – whether the objectively applicable law or the law chosen by the deceased, will regulate the following aspects of succession: a) time and place of opening of succession; b) the lines (groups) of successors and the amount of their inheritance rights, including the inheritance rights of the surviving spouse or partner; c) the preconditions under which the right to succession will be forfeited, including the loss of that right due to faulty demeanour; d) the disposable quota of the estate and the amount of the reserved shares of the successors; e) the duty to restore or account for a gift or a will which infringe upon a reserved share.
In the Regulation, specific provisions have been inserted dealing with the so called dispositions upon death (mortis causa). They are classified into two categories: agreements as to succession (Art. 25), which at present are primarily known to the states belonging to the German legal family, and other dispositions upon death (Art. 24). The principle adopted in the Regulation is: the substantive validity of dispositions mortis causa will be regulated by the law which would have been applicable to the succession if the testator had died on the same day that he/she made the disposition; however, he/she may choose as the law to govern the substantive validity of the disposition the law that he/she may have chosen under Art. 22, in the manner stipulated therein. The so called “substantive” validity of a disposition upon death shall encompass the following elements:(a) the capacity of the person making the disposition of property upon death to make such a disposition; (b) the particular causeswhich bar the person making the disposition from disposing in favour of certain persons or which bar a person from receiving succession property from the person making the disposition; (c) the admissibility of representation for the purposes of making a disposition of property upon death;(d) the interpretation of the disposition;(e) fraud, duress, mistake and any other questions relating to the consent or intention of the person making the disposition.As far as the formal validity of dispositions upon death is concerned, given that the Regulation does not provide a definition to that term, it should be assumed that the formal validity of dispositions upon death comprises all special requirements imposed by the law in relation to the manner and procedure for the execution of the testamentary disposition, as a precondition for its validity. In the Regulation, several connecting factors have been introduced for the determination of the law on whose basis the formal validity of dispositions mortis causa will be appreciated, which factors to a large extend follow the solutions of the 1961 Hague Convention, namely – compliance with the law of the state: a) of the domicile/last habitual residence of the deceased; b) of the nationality of the deceased; c) where the will is executed; d) of the location of the property to which the disposition pertains, as the law under p. “a” – “c” will be the law either at the time of making the disposition or at the time of death.
One of the principal questions which the legal framework of the Regulation raises is whether and to what extent the validity of the choice of applicable law is pre-determined by the validity of the testamentary disposition by way of which (or as a part in which) the choice is made. I consider that the formal validity of a disposition upon death is decisive as regards the formal validity of the act for the choice of law as well, but the same is not true as concerns their substantive validity – the substantive validity of the act for the choice of law and of the will by virtue of which the right to choice is exercised should be treated independently, without the invalidity of the disposition resulting in itself in the invalidity of the act for the choice of law.
Another characteristic aspect of the applicable law created by the Regulation is that an acceptance or waiver of the succession or a legacy or adeclaration made to limit the liability of the heir or legateewill be considered valid as to form where it meetsthe conditions of the law applicable to the succession as a whole (Art. 21 or 22) or the law of the state in which the heir or legatee has their place of habitualresidence.
An important feature in the legal framework of the issues relating to international inheritance under Regulation 650/2012 is also the European Certificate of Succession. It will be an official document which, until proof to the contrary, will ascertain the inheritance legal status of the persons to which it pertains, in all Member states, without observing a special subsequent procedure.Two forms of correction of a Certificate have been provided for: (a) rectification – in cases of a “clerical error”, and (b) modification – in cases of inaccuracy of certain elements thereof. Third parties who gave/received chattels or money to/from a person wrongly legitimized with a Certificate of Succession will not suffer any prejudice against their own rights unless they acted in bad faith or in gross negligence (Art. 69, para. 3-4).
Regulation (EU) №650/2012 will apply in respect of succession of persons who die on or after 17 August 2015. However, where the deceased had chosen the law applicable to his succession prior to 17 August 2015, that choice shall be valid if it meets the conditions laid down in Chapter III or if it is valid according to theprovisions of private international law which were in force, at the time the choice was made, in the State in which the deceased had his habitual residence or in any of the States whose nationality he possessed.A disposition of property upon death made prior to 17 August 2015 shall be valid in substantive terms and as regards form if it meets the conditions laid down in Chapter III or if it is valid in substantive terms and as regards form according to the provisions of private international law which were in force, at the time the disposition was made, in the State in which the deceased had his habitual residence or in any of the States whose nationality he possessed or in the Member State of the authority dealing with the succession. Even after 2015, Regulation 650/2012 will not entirely displace the private international law of the Member states relating to succession. Art. 75 of the Regulations states that it will not prejudice the application of conventions to which member states are a party, including the 1961 Hague Convention. The latter will continue to be a source of conflict norms regarding the forms of testamentary dispositions containing an international element (instead of Regulation 650/2012) where recognition of such a disposition is sought in Member state where the Convention is in force.
The United Kingdom exercised its right to non-participation in the adoption of the Regulation and will not be bound by it.
1. K. Kühne, S. Dollinger, D. Krome, in “European Succession Laws”, sec. ed., “Jordans”, 2002, p. 260 (edited by D. Hayton)
2. See А. Dodov, “Jurisdiction and Proper Law in Actions Relating to Property Rights over Immovable Property and Succession to Such Rights in the Law of England, Germany and France”, in “Studies on International Law” (joint authorship), vol. seven, Bulgarian Association of International Law, 2012, p.172