The Ultimate Judge in French Wills - French News - December 2007
Few people like to talk about French wills and taxes, but if you are a French property owner and have children under 18, this is a good time to open the conversation.
First the basics. Under French inheritance law the transmission of real estate located in France follow French rules as to heirship and the obligatory reserve parts for Children. In the absence of minors, the Notaire will supervise the probate process. However, a judge at the local Tribunal d’Instance steps in when the estate involves children under 18 or other individuals protected by the court (such as mentally handicapped.)
That is when a will becomes important. In theory, French law forbids a person to place conditions on his or her inheritance (pacte sur succession future) and the Judge has sole discetion over succession issues. However, in practice parents can and should express their wishes, and if clearly stated and reasonable, Judges will give them maximum consideration and where possible allow them to be put into practice.
What does that mean? Consider the following case. The British parents of two children under ten years old, have a 450,000 Euro French home, no other family in France and tragically pass away. The house can be a principal residence or holiday home. In the absence of a will the judge rules that the house cannot be sold until the children are 18 years old. Over the next decade the house deteriorates, as the guardian either cannot afford to manage it or live in it or just has no interest in France. The children turn 18 and a year later sell their house, drop out of university and buy matching Porsches.
Consider the alternative. The French will states the parent’s wishes are for the house to be sold, and the proceeds be used by the guardian (identified in the will) to educate the children in private (public in England) education, and for reasonable expenses, with a certain portion placed in a trust fund. An English will is prepared that dictates that once the children become 18 (when the French heirship laws no longer apply), the remaining cash be placed in a British trust to be used for the children’s university education with any remainder given to them when they are 25 years-old.
In addition to stating your wishes for how your property should be handled, I would recommend French wills also include, at least, the following. First, the primary Guardian and proposed Reserved Guardian should be identified along with clear instructions as to how the estate should be managed. Next identify the executor if different from the Guardian. Third, if the Guardian or Executor does not speak French, it is wise to identify a French lawyer, and provide for his or her expenses to bepaid out of the estate (otherwise the guardian must pay); this is important as the procedures regarding minors is complicated.
Last, French wills of course should generally be written in French. And both spouses must prepare their own will.
Let us save taxes for another day.