Devolution of the Inheritance/ Universal Succession
Within the law of succession the devolution of the estate is often regarded as a technicality. This view neglects the practical relevance of the subject. Problems incurred by legal successors during the distribution of the estate and the settlement of the debts of the deceased (liability of heirs) are often linked to the model of devolution of the inheritance in the respective jurisdiction.
Ideally, the devolution of the inheritance should fulfil two main functions: first, an orderly and timely allocation of assets both for the benefit of the legal successors and for the security of subsequent legal transactions and, secondly, settlement of debts of the estate taking into account the interests both of the creditors and the legal successors. The devolution of the inheritance comprises two aspects. First, what it is that devolves upon the successors and, secondly, the way in which whatever is the object of the devolution devolves upon the successors. The mode of devolution of the inheritance varies substantially across Europe. Broadly speaking, there are three different systems: direct and immediate accrual of the inheritance, direct accrual upon acceptance, and indirect devolution of the inheritance through an intermediary. In contrast, all European jurisdictions recognize the principle of universal succession when it comes to the object of devolution. As the term implies, universal succession refers to the devolution of the estate as a whole upon one or several legal successors. Consequently, acquisition upon death is based on a uniform causa of the law of succession. Nevertheless, this only applies to the moment of acquisition. Neither beforehand nor afterwards does the estate constitute a universitas iuris. The moment of transfer is also uniform. All parts of the estate are transferred to the transferee or transferees at the same moment. Succession upon death is universal because it relates to all rights and not to individual or special categories of rights. The method of transfer is organized in a uniform way. It is the same for all the assets within the testator’s estate. In English law, this principle has only generally been recognized since 1925.
The principle of universal succession primarily ensures the orderly and timely allocation of assets. It prevents assets from becoming ownerless. All parts of the estate are assigned en bloc to the legal successor(s)—be it directly or indirectly via an intermediary. The legal successor(s) can thus be sure to receive all of the assets of the deceased. Universal succession also benefits the creditors of the estate. In order to satisfy their claims, they can turn to the universal successor(s).
2. Modes of devolution of the inheritance in Europe
a) Direct and immediate accrual
In Belgium, Germany, France, Greece and the Netherlands the legal successors acquire the estate directly and immediately at the moment of the decedent’s death. Accrual takes place automatically. It does not depend on any cooperation on the part of the acquiring party, or on the interposition of an intermediary. The French law of succession is special in that different qualitative degrees of entitlement to an estate can be acquired at the moment of succession. However, this does not change the validity of the principle of accrual ipso iure. The French, German and Dutch succession laws compensate for the automatic accrual of the estate by means of a subsequent right of the legal successors to disclaim the acquisition of inheritance.
The principle of direct and immediate accrual ensures the transfer of the assets forming part of the estate to the legal successor. Legal successors thus enjoy, from the moment of the decedent’s death, full protection concerning the estate acquired. Automatic accrual also benefits the security of subsequent legal transactions as well as creditors and debtors of the estate since the new owner of the estate is rather easily identifiable.
These advantages come at the cost of the responsibility attaching to the legal successors for the liabilities of the estate. According to the principle of automatic accrual not only the assets but also the debts of the deceased devolve at the moment of the decedent’s death. However, the different jurisdictions allow legal successors to limit their liability. In Belgium, France, Greece and the Netherlands only a declaration of unqualified acceptance results in personal responsibility of the legal successors. Acceptance of the inheritance (inheritance, acceptance and disclaimer) in these jurisdictions does not affect the actual transfer of the estate, but only concerns the responsibility for its liabilities. In these countries it is also possible for the successors to declare an acceptance conditional on the compilation of an inventory and thereby to limit their liability to the assets of the estate. In Germany, however, the declaration of acceptance and the mechanisms to limit liability follow separate rules. The declaration of acceptance results in unlimited and thus personal liability of the successors for the debts of the estate. Liability can be limited by separate declarations, either on a temporary basis, or permanently by applying for the administration of the estate on behalf of the creditors or for the institution of insolvency proceedings regarding the estate.
b) Direct accrual upon acceptance
In Austria, Spain and Italy the devolution of the inheritance does not take place automatically at the moment of the decedent’s death but requires an acceptance by the legal successors (inheritance, acceptance and disclaimer). From the moment of death until accrual of the inheritance by the legal successors the estate is ownerless (hereditas iacens). In this interim period inventories are compiled and/or liabilities settled. The three said jurisdictions with a system of accrual upon acceptance differ particularly with regard to the degree of state influence. The national regulations range from the independent administration of the estate by the persons appointed as heirs in Italy, with an official administration of the estate on request, to the Austrian procedure of an official administration of the estate which terminates with a transfer of the estate ordered by the probate court (so-called Einantwortung). However, the declaration of acceptance of the beneficiary or beneficiaries is always required for accrual to occur.
The close link with the liability of heirs for debts of the estate (liability of heirs) comes out in the fact that the extent of the declaration of acceptance of inheritance can differ. In the first case (unbedingte Annahme (absolute acceptance) in Austria; accettazione pura e semplice in Italy; acceptance pura y simplemente in Spain), there is a complete merger of the personal assets of the heir with the testator’s estate (confusio bonorum), and the heirs are liable, without limitation, for the debts of the estate out of their personal assets (ultra vires hereditatis). In the second case (bedingte Annahme (conditional acceptance) in Austria; accettazione con beneficio di inventario in Italy; acceptance a beneficio de inventario in Spain; beneficiaire aanvarding in the Netherlands), the personal liability of the heirs is limited to the assets belonging to the estate (pro viribus hereditatis). In this respect there is a separation between the heir’s private assets and the testator’s estate (separatio bonorum).
The primary objective of the model of accrual upon acceptance is to protect legal successors from liabilities of the estate. Contrary to the model of direct and immediate accrual the debts do not initially devolve upon the legal successors to the estate. They should rather be able to decide for themselves, in the full knowledge of the financial situation of the estate, whether they are prepared to accept their position as heirs. As long as no positive decision has been made, they will not be burdened with the debts of the testator and the accrual of the inheritance.
The price for such protection of the legal successors is a suspension of the transfer of rights in rem in the estate to the detriment both of the security of subsequent legal transactions and the protection of the assets during the interim phase. Usually the system of accrual upon acceptance also involves higher costs for the state.
c) Indirect devolution of the inheritance through an intermediary
The acquisition of the estate through the compulsory interposition of an intermediary is usually known as a concept of English law. However, a similar mode of acquisition is also used in Ireland, Denmark, Finland and Sweden. Most other European jurisdictions know the device of an optional administration through an executor appointed by will.
In English law the intermediary is referred to as a ‘personal representative’. If this person is nominated by a testator in his will, he is called an ‘executor’. Where there is no executor, the probate court appoints a personal representative, called ‘administrator’. After the death of a person the estate is transferred to the personal representative by the probate court. It is the duty of the personal representative to ascertain the estate, pay the deceased’s debts, administer the estate, and then distribute the surplus among the persons entitled to the estate by will or by the rules of intestate succession (‘beneficiaries’).
The personal representative has the position of a trustee (trusts, Art X.-1:202 DCFR). He is the legal successor of the testator, but also has to take account of the interests of the beneficiaries by settling the debts of the estate and transferring the remaining assets to them—assuming that they agree to this. Only by these acts of transfer inter vivos do the beneficiaries (Art X.-1:203 DCFR) take up the legal positions determined by the testator or by law. In England, acquisition of the estate thus neither occurs ipso iure nor does it, from the point of view of the beneficiaries, even occur upon the decedent’s death. The beneficiaries only have a personal claim inter vivos for the transfer of the assets after adjustment for the liabilities of the estate. In no case are they personally liable for these liabilities. However, the first transfer to the personal representative of the testator is universal. The latter succeeds to all legal positions of the decedent, though not ipso iure or on his own initiative, but through a judicial act of appointment.
3. History of the three models of devolution of the inheritance
Both models of direct accrual of the inheritance have their historical basis in Roman law. Admittedly, the idea of universal succession was no more part of the early ius civile than succession to an individual right, or the idea of succession in general. However, the classical jurists already spoke about succedere in locum, in ius or in universum (omne) ius defuncti. The Roman jurist Julian, for instance, described the matter thus in D. 50,17,62: ‘Hereditas nihil aliud est quam successio in universum ius quod defunctus habuerit’ (Corpus Juris Civilis).
Successio in locum originally referred to the legal successor stepping into the position of the testator with his whole body, and being liable with it as was the testator. The form of succession is in a very literal sense holistic and thus universal. The succession concerning the deceased’s property is structured accordingly. It always involves succession to all assets, or a fraction thereof, but never succession ex certa re. For the sui heredes (family heirs), who are already regarded as being latently co-entitled during the life of the testator, the inheritance accrues automatically. According to the ius civile, as necessary heirs (necessarii heredes) they cannot prevent accrual of the inheritance. Their liability is unlimited, but can be restricted in case of insolvency of the estate if the praetor allows them to relinquish the inheritance (se abstinere) and grants them separatio bonorum.
The civil succession of sui heredes is the model for all European inheritance law regimes that recognize direct and immediate accrual. The model behind the concept of direct accrual by acceptance, however, is inheritance by extranei heredes (heirs outside of the family). All heirs other than the sui heredes in Roman civil law acquire the estate as a result of a specific declaration of acceptance (aditio hereditatis), rather than automatically. As long as this has not taken place, the estate belongs to no one but ‘rests’ (hereditas iacet). The estate temporarily does not belong to anybody, and it is to be preserved unchanged insofar as possible for the future heirs. Also in the case of extranei heredes, the successor’s liability is, in principle, unlimited upon acceptance, but it can be limited. However, prior to the acceptance of the estate, the appointed heir is not liable for the debts of the estate.
With the fideicommissum, the Roman legal sources recognized an institution similar to a trust. However, there is no Roman legal model for the English system of acquiring the estate by way of an intermediary. Like the trust, this system has its origins rather in the medieval system of feudal tenure. Of course, Roman law provided for auxiliaries to be employed by a testator to carry out his intentions (testamentary execution). The earliest of those was a familiae emptor, to whom the testator transferred his assets inter vivos, with the instruction that they should be distributed according to his directions among his surviving dependants after his death. The fact that this institution—like the fideicommissum—did not evolve into a method of acquiring the estate may have to do with the firm entrenchment of the principle of universal succession in the Roman legal tradition. This, in turn, was based, insofar as the inheritance of sui heredes is concerned, on the idea of the continuity of the family: initially physically and spiritually, and later also in terms of the patrimony. The aim was for the successors to assume the legal role of the deceased quickly and seamlessly, preferably without disrupting the process by involving intermediaries. No representation of the testator by a third party was envisaged, even if only temporarily. In other words, the best personal representative of the testator is the member of the familia who is to become heir, which may explain why testamentary execution in Roman law was only developed in rudimentary form.
The fact that universal succession was distinctly related to the notion of family is also illustrated by the succession of extranei heredes. As legal successors not belonging to the familia, they specially had to state their intention to integrate the assets left to them into their own estate by means of the aditio hereditatis. Acquisition of the bonorum possessio based on praetorian succession also did not follow the model of direct and immediate accrual. The estate was transferred by the court magistrate upon the beneficiary’s application. This is the model for the devolution of the inheritance based on the declaration of the probate court, which is still recognized by Austrian law.
4. Structures of a uniform law of succession
It is not easy to formulate regulatory structures for a uniform law of succession. However, there is a common goal for such regulation. All models are concerned with the orderly transfer of the decedent’s legal relationships to his legal successor. This means that the legal successor should either not be burdened with the debts of his predecessor at all, or only in those instances where he decides to accept the inheritance. The freedom of action of the successor is to be maintained insofar as possible. In all systems, the crucial period is the one between the decedent’s death and the acceptance of the inheritance. During that period, the legal successor either does not acquire his legal position (as in the English model and in the continental European systems requiring acceptance) or the allocation of the estate to him is merely provisional, until acceptance or disclaimer creates certainty.
The laws of universal succession in continental Europe are characterized by considerable ‘national modifications’ (Reinhard Zimmermann). These relate specifically to the issue of automatic accrual and accrual by acceptance as well as to the degree of supervisory influence exercised by the state during the period between the decedent’s death and the acceptance of the inheritance. The continental European legal systems that adopt the model of automatic accrual at the time of the decedent’s death are those that grant the successor a high degree of freedom. Supervisory measures are optional and depend on the initiative of the legal successor.
Legal regimes subscribing to the model of accrual upon acceptance provide better protection for the beneficiaries than those adopting the model of automatic accrual, due to the fact that the beneficiaries do not acquire the estate until the debts of the estate have been identified. It is characteristic of the paternalistic tendencies inherent in these regimes to involve the courts in looking after the estate until an acceptance has been declared. The Austrian legal system is paradigmatic for this tendency.
The most notable difference is the one between the English and the continental European models of succession. This is not based on the fact that the legal institution of trust would be unknown in the continental legal tradition; recent research has shown that this is not the case. The crucial feature of the English model is that the acquisition, on the part of the beneficiaries, is not a matter of the law of succession but a transfer inter vivos. From a doctrinal point of view, the English model of the personal representative combines the advantages of both continental European systems: the beneficiary runs no risk of personal liability because he is not the decedent’s successor. Nonetheless the inheritance is not left without an owner. The English model is therefore possibly the most suitable for legal harmonization.
Max Kaser, Das römische Privatrecht, Erster Abschnitt: Das altrömische, das vorklassische und klassische Recht (2nd edn, 1971) 672, 713; Yves-Henri Leleu, La transmission de la succession en droit comparé (1996); Peter A Windel, Über die Modi der Nachfolge in das Vermögen einer natürlichen Person beim Todesfall (1998); Reinhard Zimmermann, ‘Heres Fiduciarius? Rise and Fall of the Testamentary Executor’ in Richard Helmholz and Reinhard Zimmermann (eds) Itinera Fiduciae: Trust and Treuhand in Historical Perspective (1998) 267; Karlheinz Muscheler, Universalsukzession und Vonselbsterwerb (2002); JC Sonnekus, ‘The New Dutch Code on Succession as Evaluated Through the Eyes of a Hybrid Legal System’ (2005) 13 ZEuP 71; Marius J de Waal, ‘A Comparative Overview’ in Kenneth GC Reid, Marius J de Waal and Reinhard Zimmermann (eds), Exploring the Law of Succession (2007) 1; DH Parry and R Kerridge, The Law of Succession (12th edn, 2009); Alain-Laurent Verbeke and Yves-Henri Leleu, ‘Harmonisation of the Law of Succession in Europe’ in Arthur S Hartkamp and others (eds), Towards a European Civil Code (4th edn, 2011) 459.