GMW: Assets abroad? Beware! | ACCESS
2013-03-06 | By Sieta Autar
Imagine you find out you’re the lucky winner of the lottery. What would you do with your winnings? Can you already picture it? White beaches, swaying palm trees and a cloudless blue sky, all there for you to enjoy from your ultra-luxurious holiday home. Your car’s sitting in the garage, of course, and you’ve got a tidy sum tucked away at the local bank to cover those day-to-day necessities. It all sounds wonderful, but what happens if you die?
Nobody likes thinking about death – but it’s important that you do. Particularly if you don’t want to make things unnecessarily difficult for your surviving dependents.
What if there are assets abroad?
Each country has its own laws, and the Netherlands is no exception. When a Dutch person dies, in principle Dutch inheritance law will apply to his estate. The same goes for a foreign expat who has lived in the Netherlands for more than five years and even – under circumstances – for foreign expats who have not lived in the Netherlands for five years.
So what’s the situation if you have assets abroad? Does Dutch inheritance law apply then as well?
There isn’t a straightforward answer to this simple question. This is because each country is sovereign – which means each country has the right to make, enforce and amend its own laws. The same applies to inheritance law. Although our neighbouring countries seem to have fairly similar inheritance laws to ours, the similarities are often superficial, so you can’t simply assume that your Dutch will is also valid abroad. For this reason it is often advisable – if you have assets abroad – to consult a local notary or lawyer, who should know the laws of his own country better than anyone. And once you’ve done that, have your foreign will checked in the Netherlands, just to be safe.
Court of Appeal ruling
On 13 November 2012 the Court of Appeal in The Hague ruled on a long, drawn-out inheritance case. The story was this: when the father died, his children discovered that he had also made a will in Portugal. In that will, he granted his new partner the usufruct of his Portuguese assets. Usufruct is the right that gives a person the enjoyment of another person’s assets. This means the usufructuary has the right to live in or let the home and is entitled to the interest on a savings account.
The children didn’t have an issue with the usufruct per se, but the Portuguese will also stipulated that the father had revoked all previous wills. This would mean that the father had declared the will drawn up in the Netherlands to be null and void – and, according to the children, that had never been the intention; the father merely wanted to provide for his Portuguese assets in his Portuguese will. Nothing more, and nothing less.
After a good four years of quarrelling and no end of court proceedings, the Court of Appeal in The Hague determined that the Portuguese will was not valid in just one respect: the revocation of previous wills had no effect.
All’s well that ends well?
Yes and no. It’s great that everything turned out OK in the end, but the father could have spared his children and his partner all this distress. If you have assets abroad, whether you are a Dutch expat abroad or a foreign expat in the Netherlands, I would be happy to assess whether your foreign will is inconsistent with your Dutch will.
Have you been sidelined as an heir as a result of a foreign will? If so, get in touch with me, because a lawyer who specialises in inheritance law can get the unintended consequences of a will remedied by the courts.