Many foreign citizens have in recent times invested in Real Estate in Spain. They have already gone through the experience of the real estate business in this Country and enjoy life in the sun during holiday periods. A great deal of them are no longer young (of age) and their expectation of life is obviously reduced as unfortunately it is a human condition that sooner or later the death arrives. For those who are in the said situation and also for those who would like to save their heirs a legal entanglement upon their death it is strongly advisable to execute a Spanish Will which will facilitate a speedy and smooth transfer of the part of their Estate left in Spain.
Advantages of having a Spanish Will
The Will as institution whereby a person (“The Testator”) disposes of his assets upon his death to certain persons (“Heirs”) has existed in practically all ancient civilisations and is at present available as an useful tool for inheritance purposes in the majority legislations of the countries of the world.
In case of foreigners having assets in Spain the advantage to execute a Spanish Will is mainly the save of administrative backlog to the heirs upon the death of the owners of those assets. This means that on death of the Testator, the Spanish part of the Estate can be wound up without delay and simultaneously to the foreign Estate. Apart from the Spanish Will, only two other documents will be required to transfer the assets in Spain to the heirs : 1) The Death Certificate from the Testator which must be translated to the Spanish Language by a sworn translator, notarised and legalised at the relevant office in the foreign country and 2) A Certificate from the Central Last Will Registry in Madrid confirming that the Testator has left a Will executed before a Notary Public, being the recorded Will the last will left by the testator. The Central Last Will Registry is an official registry where all Wills executed before Spanish Notaries are recorded. Upon the execution of a Spanish Will, the attesting Notary must compulsory remit a note to the said Registry with information of the name of the Testator, the date of execution and the protocol number of the Will. If a testator has executed a second or further Will, under Spanish Law the latter will automatically revoke any former Will, unless otherwise specifically provided for by the testator and therefore in the aforereferred Registry the last Will left by the Testator in Spain will always appear. In such Registry Wills executed abroad before a Notary Public can also be registered providing the Will is drawn up in Spanish Language or same has been duly translated into Spanish and legalised. The legalisation is the verification by the foreign country relevant office that the will has been attested and witnessed by a notary whose signature and seal are registered with them.
With the said two documents and a notarised copy of the Spanish Will the appointed heirs or someone under Power of Attorney from them, usually a Lawyer, can proceed with the execution of the Deed of Declaration and Acceptance of Inheritance (“Escritura de Declaración o Manifestación de Herencia”) before a Notary Public whereby the assets of the Testator left by way of the Will are transferred to the appointed Heirs. The said Deed has to be submitted for the payment of the Death Duty before the Spanish Revenue within six months of the demise and once the tax has been paid same is lodged with the Land Registry for final registration of the assets in the name of the heirs.
If the deceased person has not left a Spanish Will, the normal scenario the Heirs will face is that they contact a firm of solicitors in their own country in order to wind up the foreign Estate. If there is a foreign will and same has provisions for the Spanish assets a Grant of Probate will have to be obtained through the Foreign Courts ratifying who are the legal heirs to the part of the Estate left in Spain. If no Will was ever left by the deceased person the corresponding intestacy proceedings will have to be followed through the Courts in the foreign county in order to obtain a Resolution declaring who are the legal heirs to the Estate. The Grant of Probate or whatever the Resolution declaring who the Heirs are have to be translated by a sworn translator to the Spanish Language, Notarised and legalised. By the time the Heirs have gone through this lengthy and costly process the six-month statutory period to make the Death Duty Tax return in Spain for the Spanish Assets will most likely be over and surcharges and penalties will have accrued to the Tax Bill. Thus, the advice for every foreign property owner in Spain is to make a Spanish Will.
Law governing the Inheritance
The International Law provisions of the Spanish Civil Code provides for the Law of the Nationality of the demised person to be the Law governing all Inheritance Matters relating to the said person. This means in case of an UK Citizen, UK Law will be applicable to his Inheritance and in particular to his Spanish Estate. UK law provides for the principle of freedom to testate for the testator. Other countries may provide for a certain part of the estate which must compulsory pass to specific heirs and this will always have to be respected by the testator when making the provisions on his/her will.
On the 4th of July 2012 the regulation 650/2012 of the European Union was approved to try to unify the European legislation on successions which came into force in Spain on the 17th of August 2015 and will be applied to any succession which takes place since that date.
The new regulation establishes as general rule that the law applicable to a succession is the law of the country where the deceased had his last permanent address at the time of his death.
However, the regulation expressly allows that one can choose that the law to be applied to his succession is his/her personal law, i.e. that of the country of his nationality having to expressly state this in a Will.
So therefore, you should make sure to include a clause in your Spanish Will where you choose the law which would govern how you would like your assets in Spain to be transferred upon your death. This is important if in your country there is freedom for the testator to chose who he would like to leave his assets upon his death then he should make an specific provision to his national law to be the law governing his inheritance in Spain. Otherwise, if he were resident in Spain on his death and no such provision exists in his will, the provision of the Spanish Law for the inheritance will apply and 2/3 of the assets will compulsory go to his children, his wife would be entitled to the life interest of 1/3 on the 2/3 belonging to his children and he can only dispose freely of 1/3 of the assets which would go to whoever he wishes.
Formalities in the Execution of a Spanish Will
I shall refer to the most common type of Will in Spain which is the Open Will (“Testamento Abierto”) which is signed by the Testator before a Notary Public.
A foreign person executing a Will before a Spanish Notary will have to use a translator who will translate the terms of the will to his native language and who will sign the Will as well. The translator in most cases will be the lawyer assisting his client in this matter.
The execution of a Will is a personal and individual act which means that same has to be signed personally by the Testator and not by someone with power of attorney from him and that two persons cannot execute the same will, therefore the joint will is not valid under Spanish Law.
The Notary will read the last Will as given by the Testator who together with the Notary and the translator will subsequently sign the Will. The Notary will make reference in the document to the exact time and date of execution of the Will. In certain cases the use of witnesses is required as provided for in the Law or when the Notary or the Testator so require. The Notary will declare in the Will that he has identified the Testator by his passport and that the latter has enough legal capacity for the execution of the Will. All the aforereferred formalities have to be completed in one sole act and if same are not complied with the Will can be declared null and void.
In case the Will is signed before a foreign Notary Public, the formalities of the place of execution (“Locus Regit Actum”) will be applicable. The foreign law may provide for the need of Witnesses and any other formalities which will have to be complied with. The Will executed abroad will have to be executed in bilingual form, legalised and further registered in the Last Will Registry in Madrid.
Proposal for a Spanish Will
Before we consider the concrete proposal, one has to part with an important aspect of the Will which is that same must be confined to the Spanish Assets which means that specific mention will be made in the Spanish Will that any other Will executed by the Testator for his remaining assets elsewhere will not be revoked by the Spanish Will.
The Notary will make the warning to the foreign Testator that the latter states that the dispositions made in the Spanish Will can be made in accordance to his National Law which is applicable to his Inheritance, especially if he is a national of a UE country and has chosen in his will that his national law will govern the transfer of his assets in Spain upon his death.
I we consider the most normal scenario a couple with children and the Spanish Property has been registered in the name of the parents, these would normally leave in their respective Will all their assets, interests and rights in Spain to each other and in case of predecease, simultaneous decease of the other consort, or in case of unexpected incapacity or waiver by the latter, the appointed heir shall be substituted by their children in equal shares. It is very important to include the substitution clause in the Will in order to avoid intestacy proceedings.
Any other provisions are also valid so long as they respect the foreign Law and the applicable regulations as expressly required by Spanish Law and it is not unusual to see in our practice that Properties are left to Foundations or Charities and some pet lovers leave a few thousand pounds to a dog with specific provisions for its burial and with the most eccentric literature setting out the terms of the Will.
Therefore, if foreigners want to enjoy their property in sunny Spain with a trouble-free mind, they would be well advised to execute a Spanish Will. And after that, they can catch a flight without worrying what will happen to their Spanish assets if the plane crashes- although I suppose that would be the least of their problems.
Rafael Berdaguer is a lawyer from the firm Rafael Berdaguer Abogados, based in Marbella, Spain.
Tel: 0034 952 823 085 / Fax: 0034 952 824 246
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Rafael Berdaguer
Lawyer within the firm
Rafael Berdaguer Abogados based in Marbella, Spain.
www.berdaguerabogados.com
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