The EU's Regulation on Succession - European Union Committee Contents


CHAPTER 5: Jurisdiction, Recognition and Enforcement

99.  The Commission proposal envisages the single basic rule that the court of the Member State in which the deceased was habitually resident at the time of death should have jurisdiction to deal with a succession.

100.  The same test would be applied to cross-border successions involving a third country where the deceased was habitually resident in a Member State. But this could only resolve any conflict of jurisdiction there might be between Member States. Any conflict with a third country could only be resolved by agreement with that country.

101.  Specific provision is also made in the proposal to resolve any conflict of jurisdiction between Member States where the deceased was not habitually resident in the EU at the time of death. This is termed "residual jurisdiction" in the proposal.

102.  The Commission proposal also envisages establishing consistent rules to simplify the recognition and enforcement of decisions given by the courts of the Member States and also of authentic instruments produced by notaries. This would not apply to decisions or authentic instruments from third countries.

Jurisdiction

103.  The laws of the individual Member States can give rise to different answers to the question of which court is to deal with a cross-border succession, and the possibility that more than one could, by its own law, have jurisdiction to do so. This gives rise to the further possibility that there may be a race by those contemplating litigation to start proceedings in the jurisdiction they perceive will give them an advantage. For example, delay in reaching a decision may favour one party, with a resultant rush by that party to start proceedings in a jurisdiction which is slow to process litigation.

104.  The resolution of the question of which court has jurisdiction is different from the question of which law should apply to the succession. It may be the case, for example, that all the litigants in a succession dispute live in a Member State other than that of the applicable law, making it more convenient for the court of their Member State to resolve their dispute. There is, however, a strong link between the jurisdiction and the applicable law in that it is cheaper and more convenient for the court dealing with succession to apply its national law.

105.  For Richard Frimston, including in the proposal provisions dealing with jurisdiction was one of the matters making the proposal difficult in practice because it was so novel (Q 65). None of our other witnesses questioned the underlying benefit in principle of EU legislation providing a single rule for determining which court should have jurisdiction. However there were questions as to how the proposal seeks to achieve this. The Commission proposes that jurisdiction should be determined by the habitual residence of the deceased at the time of death, mirroring the basic rule of determining the applicable law. This choice raises the same issues of certainty as arise from using this connecting factor to determine the applicable law. It raises the spectre, in a case where it is uncertain where the habitual residence of the deceased was, of a race to start proceedings. As the proposal stands the first court to which the matter is brought would have the sole right to deal with the case unless and until it decides that it did not have jurisdiction, irrespective of the objective merits of the various claims for habitual residence.

106.  However jurisdiction would not follow applicable law where a person chooses to apply the law of his nationality. In this case jurisdiction remains with the court of the Member State of habitual residence, but that court would have a discretion to invite the parties concerned to use the court of the nationality of the deceased which would also be the court of the applicable law.

107.  Professor Matthews, Richard Frimston, the Chancery Bar Association and the joint evidence of the Law Society, STEP and the Notaries Society favoured jurisdiction following the applicable law (QQ 37, 51, pp 61, 83). This approach would avoid the added cost and inconvenience arising from the need to provide expert evidence of the content of the law applicable to the case and the need for the court to apply a law with which it was not familiar.

108.  This is a particularly important question for the UK where succession can involve complicated issues of trust law with which the courts of most other Member States are not familiar and which can often require an assessment of oral evidence, after cross-examination, to be resolved. The legal traditions of most other Member States favour written evidence including notarial acts. They tend to relegate oral evidence to a lower level and do not employ the technique of cross-examination to test the veracity of witnesses.[31]

109.  Jonathan Faull indicated that the Commission had chosen the approach found in its proposal because it envisaged that most Member States would not be persuaded to make the link between the applicable law and jurisdiction mandatory. Instead it had chosen flexibility (Q 110).

110.  We consider that the connecting factor to determine jurisdiction should be the same as that used to determine the applicable law, including in cases where a testator has chosen the applicable law.

111.  Different considerations apply where the cross-border element of the succession involves third countries. The proposal would apply the rule applicable to Member States if the deceased died habitually resident in the EU. If, on the other hand, the deceased died habitually resident in a third country, there would be a hierarchy of connecting factors to determine which Member State has residual jurisdiction. The hierarchy is: the previous habitual residence in a Member State of the deceased, the nationality of the deceased, the habitual residence of those inheriting (irrespective of the size or proportion of the inheritance), and the location of the property which is the subject of the proceedings. These clearly provide the potential for more than one Member State to have residual jurisdiction. Where this happens the first court to which any dispute is brought would have sole jurisdiction until it decided otherwise.

112.  In their Explanatory Memorandum[32] the Government identified a need to tighten the categories for attributing residual jurisdiction. For example the rules set out in the proposal could lead to the court of a Member State of an heir who only benefits from a very small inheritance having jurisdiction.

113.  Jonathan Faull characterised the circumstances in which residual jurisdiction would arise as "circumscribed" and thought the hierarchy sufficiently clear. He accepted that the test of this would be the extent to which they would invite or facilitate forum shopping by potential litigants (Q 112). Professor Matthews saw nothing wrong in having a hierarchy of factors to determine residual jurisdiction, but accepted that it was for negotiation precisely what it ought to be (Q 37). Richard Frimston described the proposal for residual jurisdiction as "fairly sensible" (Q 83).

114.  We believe that if the proposal is to deal with jurisdiction it should include provision for residual jurisdiction. The proposal is however capable of being tightened up to ensure that the circumstances in which more than one residual jurisdiction arises are more limited and the connection between the succession and any residual jurisdiction is stronger.

Recognition and enforcement of court decisions and authentic instruments

115.  The potential benefits to be derived from the simplification of the rules resolving conflicts of applicable law and jurisdiction can be enhanced by making the decisions taken in one Member State recognisable and enforceable in another. A person benefiting from a decision in one Member State would not incur added expense and delay in going through a process in another Member State in order to have that decision given effect. The question arises whether such recognition or enforcement should be subject to safeguards to protect the public policy of the Member State in which recognition or enforcement is sought. This might happen, for example, if the original decision were made without an interested party having what was considered to be a sufficient opportunity to contest it.

116.  The Commission proposes that decisions made in one Member State, whether made by courts or by notaries in the form of authentic instruments, should be recognised and enforced in other Member States in accordance with rules based on those currently in place in respect of civil and commercial matters.[33]

117.  Recognition of a decision of a court in another Member State would not require any special procedure, but the court in which recognition is requested might refuse on limited grounds: that recognition was "manifestly contrary" to public policy, the defendant had insufficient opportunity to arrange the defence, and the decision was irreconcilable with an existing decision in a dispute between the same parties. The procedure for enforcement, following the rules for civil and commercial matters, would involve obtaining a declaration of enforceability in the court of the Member State of enforcement according to a single simplified procedure. If contested, a declaration of enforceability could only be refused on the grounds on which recognition could be refused.

118.  In contrast, an authentic instrument would have to be recognised unless it was "contrary" to the public policy of the Member State in which recognition was sought. The procedure for enforcement of an authentic instrument would follow that of a court decision save that the only ground for refusal would be that enforcement was contrary to the public policy of the Member State in which enforcement was sought.

119.  The recognition and enforcement of court decisions was regarded by Richard Frimston as an objective worthy of pursuing, but one which could raise tricky issues. He cited the example of Malta, which does not have a law of divorce. He asked whether that meant that a Maltese court would not recognise a divorce obtained elsewhere, with a consequential effect on succession issues which were dependent on whether the marriage was regarded as continuing to exist up to the time of the death (Q 86). Other witnesses did not raise objections to the provision for recognition and enforcement of judgments.

120.  On the other hand there was widespread concern at the recognition and enforcement of decisions taken by notaries in the form of authentic instruments. Professor Matthews explained that the functions of notaries are to record and give publicity to transactions. Those transactions are generally concluded in the context of an agreement by the relevant parties, rather than a dispute. Given the absence of litigation, transactions before a notary tended not have the same procedural safeguards built into them as do decisions of courts. In particular a notary might not have been made aware of the existence of a dispute affecting the succession to a particular property and might not have given all interested parties a chance to state their case. Professor Matthews therefore advocated that authentic instruments should have the status of high quality evidence rather than be recognised and enforceable (Q 38, p 11).

121.  Lord Bach and Oliver Parker raised a serious concern about the recognition and enforcement of authentic instruments which had been apparent from the early discussions of the proposal in the Council Working Group. It arises from the fact that the proposal would provide rules for resolving conflicts of jurisdiction between courts but would not apply the same rules to determine who should be able to produce an authentic instrument. This discriminates against court-based systems in favour of systems which use notaries. The specific example used to illustrate this concern is outlined in Box 8 (Q 162).

BOX 8

An effect of the proposal for recognition and enforcement of an authentic instrument

A contested succession is being litigated in London according to the jurisdiction provisions of the proposal. A disgruntled party could nevertheless seek an authentic instrument from a notary in another Member State and that notary could properly issue one as the jurisdiction rules only apply to courts. The notary might not even be made aware of the contested proceedings in London. The likelihood is that the authentic instrument could be obtained before any judgment was delivered by the London court.


Recognition and enforcement of the authentic instrument is automatic unless it can be proved to be in breach of public policy in the enforcing state, which is likely to be difficult to achieve in the majority of cases. The effect would be to pre-empt or undermine the London judgment.

122.  Jonathan Faull suggested that the Commission had not gone too far in providing for the mutual recognition and enforcement of authentic instruments because of the important role that notaries played and the safeguards provided (Q 118). He pointed out that notaries were firmly established as an indispensable part of the system in the Member States where they took a prominent role in overseeing successions (Q 122).

123.  We consider that the mutual recognition and enforcement of court decisions is likely to be sufficiently non-controversial to be acceptable in principle. However we do not consider that there is sufficient mutual trust at present to justify making authentic instruments recognisable and enforceable. We consider that authentic instruments should be given the status of evidence rather than being recognisable and enforceable.


31   Evidence of Professor Matthews (p 9). Back

32   http://europeanmemorandum.cabinetoffice.gov.uk/files/Numbered%20EMs%2009/14001-15000/14722-09.pdf Back

33   Regulation 44/2001 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters. Back


 
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