Case law Developments in PIL

The CJEU Again on Notaries as “Courts”, National Certificates of Succession and More

The author of this post is María Barral Martínez, trainee at the Court of Justice of the European Union.

On 26 March 2020, Advocate General Campos Sánchez-Bordona issued his Opinion in C-80/19, E.E. (the text of the Opinion was not available in English at the time of publishing this post).

At first glance, the case is reminiscent of case C-658/17, WB, where a request for a preliminary ruling from Poland sought clarification on the concept of “court” within the meaning of article 3(2) of the Regulation 650/2012 (“European Succession Regulation”), and which also dealt with the nature of the certificates of succession rights at national level. To a lesser extent, the case follows up on the question of competence of national authorities to issue certificates of succession, addressed by the Court in C-20/17, Oberle.

However, in E.E., the Court is faced with several questions that go a step further.

First, the referring court asks whether Lithuanian notaries meet the definition of “court” under article 3(2) of the Regulation.

Second, should this not be the case, whether Lithuanian notaries, without having to apply general rules of jurisdiction, can issue national certificates of succession and if these are deemed to be authentic instruments which have legal effects in other Member states.

Moreover, the referring court inquires, considering the present case’s factual circumstances, if the succession at stake qualifies as a succession with cross-border implications and, therefore, whether the European Succession Regulation should apply.

In addition, the referring court asks whether it could be inferred from the Regulation that the habitual residence of the deceased can only be one. Finally, certain questions were posed relating to the choice of Lithuanian law and on the choice-of-court agreement by the parties concerned.

The case

The Appellant’s mother, a Lithuanian national married to German national, moved to Germany with her son (E.E., “the Appellant”). In one of her visits to Lithuania, she had her will made by a notary located in Kaunas, designating her son as sole heir of her entire estate, which consisted of an apartment in Kaunas. After the Appellant’s mother died, he contacted the notary office in Kaunas to initiate the succession procedure, asking for a certificate of succession rights.

The notary refused to issue the certificate. She argued that, according to the European Succession Regulation, the last habitual residence of the deceased mother was in Germany. The Appellant challenged the notary’s decision before the Kaunas District Court (“District Court”), which quashed the decision of refusal and ordered the notary to open the succession procedure, and to issue a certificate of succession rights. The District Court stated that even though the Appellant’s mother had moved to Germany, she was a Lithuanian national and, on the day of her death, she owned immovable property in Lithuania. Further, she had not severed her links with that country, had kept visiting it, and set up her last will there.

The notary appealed the first instance court decision. The Kaunas Regional Court (“Regional Court”) ruled in her favour putting forward that whenever the habitual place of residence of the deceased is disputed, only a court can establish the legal fact leading to the recognition of the habitual place of residence of the deceased in her country of origin. In the present case nothing indicated that the court of first instance had addressed that issue; in deciding against the notary’s decision it had rather – and unreasonably- relied upon general principles.

E.E. lodged a cassation appeal before the Supreme Court of Lithuania, who submitted the request for preliminary ruling. Case C-658/17, WB, was pending at the time, but decided before the attribution of C-80/19 to AG Campos.

Application of the Regulation, the concept of cross-border implications and last habitual residence of the deceased

AG Campos Sánchez-Bordona starts his analysis addressing the applicability of the Regulation. In his view (in disagreement with the arguments of the referring court, in fear that applying the Regulation to the case at hand would make it harder for the sole heir to claim his rights), when a given succession presents cross-border implications, the application of the Regulation is compulsory (point 36). He highlights that the Regulation itself may provide for means to mitigate the effect of the cross-border character of a succession. Notably, under Article 22 thereof, a person may choose her national law as the law governing his succession, following which the parties concerned will be allowed to opt for a choice-of-court agreement giving the courts of the member state of the nationality of the deceased exclusive jurisdiction to rule on the succession as a whole.

The Regulation does not provide for a definition of “succession having cross-border implications”. It nevertheless portrays different examples of succession having cross-borders implications. In the light of them, AG indicates that some key elements could be the location of the estate, the heirs and legatees or the nationality of the deceased.

Further, AG looks into whether it is possible to establish the last habitual residence of a deceased in more than one state and on how could it be determined. He notes that allowing for the location of the habitual residence in more than one Member State would thwart the aim of the provisions under the Regulation (point 44). In accordance with the principle of unity of succession, legal certainty and the aim to avoid contradictory results, article 4 of the Regulation should be understood as meaning that the last habitual residence of the deceased can only be located in one Member state.

Moreover, he emphasises that the concept of habitual residence is an autonomous notion of EU Law to be primarily interpreted in the light of the objectives of the Regulation itself (point 46). The habitual residence of the deceased should reveal a close and stable connection with the Member State concerned. To determine the exact location of the habitual residence, it is necessary to carry out an overall assessment of the life of the deceased during the years preceding his death. Such assessment should be done in a case by case approach. The authority dealing with the succession should consider all evidence that would help to determine the habitual residence. For that purpose, AG points out that  the Regulation itself provides some guidance. Recitals 23 and 24 envisage two different scenarios: The first one, where factual information, especially in relation to the duration and regularity of the testator presence in a State, already reveals a close and stable connection with the state concerned. The second one features a situation where the deceased was not, on a permanent basis, in a single State. In the latter, a personal element (the nationality of the deceased) or economic factors (where the main assets of the estate are located) should weight more in the overall assessment of the circumstances relating to the life of the deceased.

In contrast, as AG puts it, mere statements of the persons with an interest in the succession are not pertinent for the ascertainment of the habitual residence of the deceased (point 50).

Lithuanian notaries and national succession certificates

Next, the Opinion deals with the question of whether Lithuanian notaries are “courts” within the meaning of article 3(2) of the Regulation. AG, based on the information provided by the referring court and the Lithuanian government during the hearing, concludes that, when issuing a national certificate of succession rights, Lithuanian notaries are not vested with the power to hear and determine disputes in matters of succession. Hence, they cannot settle contentious issues between the parties (point 81). Neither can they interpret any doubts arising from the provisions of the will, rule on its validity or execution. For that, a judicial authority is required. Therefore, following the Court’s line in WB, Lithuanian notaries do not meet the definition of “court” under article 3(2) of the Regulation. Therefore, they are not subject to the rules of jurisdiction in that instrument (points 83 and 84).

AG observes that, subject to the referring court verification, Lithuanian national succession certificates, issued by a notary at the request of one of the parties, in accordance with an official model, and following verification of the facts and statements listed therein, qualify as authentic instruments under of article 3(1)(i) of the Regulation. Hence, they shall produce evidentiary legal effects in other Member States (point 88).

Applicable law and Choice-of-court agreement

The Opinion turns then to the question whether the parties accepted the jurisdiction of the Lithuanian courts and whether Lithuanian law applies.

As AG highlights, only the deceased can choose the applicable law; the choice is limited to his/her national law according to article 22(1) of the Regulation. Moreover, it is subject to certain formal requirements laid down under article 22(2) thereof. A choice of law by the deceased which has not been explicitly made in a declaration in the form of a disposition of property must result exclusively from the terms of such a disposition. Elements such as the travel of the testator to Lithuania to grant her will before a notary, the nationality of the latter or the legal system bestowing him with the competence to draft the will, are only supportive -but not decisive- factors. Precisely because a notary was called to intervene at a time when the Regulation had already entered into force, it could be expected that the testator got legal advice as to the applicable law.

In the case at hand, the will of the deceased was drawn up before 17 August 2015. As she passed away after this date, the application of the transitional provisions under article 83 of the Regulation was called for. Article 83(4) thereof establishes a legal fiction by which “if a disposition of property was made prior to 17 August 2015 in accordance with the law which the deceased could have chosen in accordance with this Regulation, that law shall be deemed to have been chosen as the law applicable to the succession”. Under these circumstances, as AG indicates, there is no further need to ascertain if a valid choice of law was made by the testator under Article 83 (2) of the Regulation.

With reference to the choice-of-court agreement, AG remarks that Article 5 would allow for such an agreement only under the condition of a choice of law by the testator. In the present case the question arises whether the parties concerned would still have that option, since the national law of the testator had not been chosen but is imposed as a result of the legal fiction designed under Article 83(4). In point 113, AG indicates that the answer must be yes, ruling out a formalistic reading of the Regulation. Jurisdiction is thus granted to the authority most familiar with the applicable substantive law, in consistency with the objective set out in Recital 27 of the Regulation.

Finally, AG understands that there has been no agreement between the parties concerning the exclusive jurisdiction of Lithuanian courts to rule on the succession. Only unilateral statements and actions were made by the Appellant and the spouse of the deceased in favor of having all succession matters settled in Lithuania  In particular, the spouse consented to the jurisdiction of Lithuanian courts while expressing that he would not be a party to any proceedings. Against this background, AG concludes that article 7(c) should be read as meaning that a statement made outside the proceedings by a party concerned with the succession, by which she accepts the jurisdiction of the courts in respect of proceedings initiated by other party, amounts to an express acceptance of the jurisdiction of those courts, provided it satisfies the formal conditions required by the procedural rules of the forum (Point 123 (7)).

%d bloggers like this: