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EU Succession Regulation etc.: The notion of direct seisin to immovables in English law, or how to put renvoi back in its box.

September 4th 2020

The EU Succession regulation is creating a great many questions con,cernig how it works and how it will work for Brtish residents and nationals at the present time and after Brexit, when the UK is no longer a  Member State of the European Union. I can assist with that from Jersey as I have a qualification in European Law, and a great deal of expreicnce in this matter. I have published several articles on its workings corecting some of the errors made in the Regulation's application, even in Brussels.

I published this technical article on Linked In, but think that it might be useful for professionals dealing with successions in Europe generally, where these may be governed by English law under the EU Succession Regulation. Note also that certain European states that are not members of the EU, but were under communist influence and therefore without any real laws of property to speak of, and may be in the process of joining are adopting the basic structure of the EU Regulation as their private international law process. Nothing like a clean slate to work off. The EU Regulation is in the direct line of the processs initiated by the Hague Convention  of 1989 on the law applicable to succession to the estates of deceased persons. These things take time.

Some say that this concept and mode of transmission of immovable property was eradicated from the English and Welsh jurisdiction by the Real Representatives Law of 1897 carried over to the 1925 Law of property legislation. What follows is little more that what I hope to be educated musings and I would be quite happy to support its conclusions by an opinion if required

The issue as to whether the old English common law manner of devolution of immovables by direct seisin is coming back to the fore in the light of the Unitary concept of the law governing successions recently introduced in Europe, albeit not within the United Kingdom jurisdictions, which induces the law of the habitual residence of the deceased into the equation of a European succession. However a recent Case in the High Court has illustrated the complete chaos that can arise when an English Court attempts to assert any jurisdiction over the devolution of a foreign immovable and apply English trust or personal representative rules intended for its own domestic consumption abroad.

I have written several times on the subject on Linked In with varying degrees of interest being shown and I should admit a degree of opposition from certain quarters including luminaries from STEP. Without undue insinuation, STEP by definition has an interest in promoting the interests of its members as personal representatives acting outside of the English jurisdiction. Whilst English law requires that certain categories of asset be dealt with under the lex domicilii i.e. movables, and thus enables a personal representative to act abroad under an English Grant, it does not admit that a personal representative acting under a statutory trusteeship or otherwise can have power over an immovable situated outside the English jurisdiction without a refiling of a grant in the other country . Try it on in Scotland or the Crown Dependencies if you think otherwise.

Scission means just that. No jurisdiction over foreign immovables.

I will cite the unfortunate chaos that has been instigated in a will drafted by an English resident over land in Montenegro, outside the EU Succession Regulation as an example. HHJ Paul Matthews made the following statement in his judgment at [2020] EWHC 2236 (Ch) Case No: C31BS010. The issue related to the devising of land in Montenegro by an English will to the Serbian Orthodox Church. The judge had previously ordered that it be held in trust. One can already sense the issue arising, and given Professor Matthew's, as he used to be, knowledge of Private International Law, it is surprising that the initial order was granted without comment. The notary in Montenegro simply said he was unable to process it, and that is of no surprise. §17-19 of HHJ Matthew's judgment reads as follows:

The problem arises here because the way in which common law and civil law legal systems deal with the property consequences of death are fundamentally different. In civil law countries (including, I assume Montenegro) the formalities of succession on death are dealt with by a notary (or sometimes by way of an officially issued certificate of inheritance), who takes care to identify precisely the heirs and the assets (and sometimes liabilities) of the deceased. The heirs are few, and are clearly specified in the law (or in a will). Moreover, there are no trusts to complicate matters. The transmission of rights (and liabilities) is instantaneous on death, from the deceased to the heirs, without the interposition of anyone like a personal representative. The heirs will pay the debts of the deceased. Moreover, this takes place in the context of a precise registration system both of persons (using concepts such as the French état civil) and of property (often cadastral, as it apparently is in this case). The notarial act or (or certificate of inheritance) will be tailored exactly to the needs of the registration systems.

In England and Wales, however, there is no instantaneous transmission from deceased to those who inherit, no état civil, and no cadastral property system in the civil law sense. Instead, there is interposed between the deceased and the beneficiaries of his estate a personal representative, whose function is to collect in assets and pay debts, before passing any remaining positive balance to those entitled to inherit. There is no notary involved, and no official inheritance certificate. This means that in practice succession on death is dependent upon the due performance of the duties of a (private-sector) personal representative, who need not rely on any official information. Here the personal representative could (and no doubt, if the Montenegrin property were situated in England, would) use such extrinsic evidential tools as were available to him or her to identify the property in question. Since the deceased owned only one property in Montenegro, that would present no problem. However, in a civil law system with a cadastral registration scheme, such a pragmatic, "flying-by-the-seat-of-your-pants" approach is unlikely to be acceptable, as indeed the Montenegrin court has confirmed.

It is one thing to recognise the cause of the problem. It is another to propose a solution to it. Undoubtedly, the parties did not at the time of the litigation think forward to the problems that might arise with the enforcement of any order made. The lawyers concerned cannot be blamed for this. Their expertise lies in the law of their own countries, and not that of different ones (that is, on the one hand, civil law countries like Montenegro, or, on the other, common law countries like England and Wales). The court is asked to make an order under the slip rule in CPR 40.12. For the reasons given, it cannot do this. There was no accidental slip or omission. The court decided what it was asked to decide. A certificate of that decision cannot change that. I must therefore dismiss this application.

One can but feel for him. it appears to be a mess. The English Court only had jurisdiction to allocate title over a foreign immovable when the parties to the case are domiciled in England and the will or disposition affects both English immovables and foreign immovables. You still cannot sue over title to a foreign immovable alone in an English court. The remedy of a resulting trust was granted in Webb v Webb on a personal basis, not on an in rem basis.

When HHJ Matthews says "In England and Wales, however, there is no instantaneous transmission from deceased to those who inherit, no état civil, and no cadastral property system in the civil law sense" he may have only stated the part of the law of England and Wales applicable following the Real Representatives Law 1897 in England and Wales. There is in fact another solution than that of holding fast to the English scissionist concept for dear life and applying English rules as if the scissionist concept allowed it.

What did the Real Representatives Law 1897 accomplish? Firstly Dicey states in his edition following the 1897 Law and Megarry agrees in his Third Edition that that Law and as to its consolidation in the 1925 Law of Property consolidation, that that Law only applied to England and Wales. It did not apply to land or its administration outside the jurisdiction. It certainly did not apply to Scotland or Northern Ireland and therefore anywhere else, including what is now Serbia or Montenegro. Parliament sitting as the English or the UK Parliament does not declare jurisdictional war abroad whether by clam, vi or precario so as to appropriate foreign land to its jurisdiction merely by statute. It has aircraft carriers, and an army for that.

What the 1897 Law did not do was to totally excise the original common law concept of direct seisin to immovables from English law. As a statutory amendment to the common law of Norman origin , it only did so and could only do so in relation to immovable property situated within the English jurisdiction, leaving the Norman concept in a limbo from which it has been released inter alia by the European Succession Regulation's unitary approach and by the Anglo-Norman habit of owning property abroad in jurisdictions that might require its devolution to be dealt with under the English common law. The scope of the Law of Property Act following on the from the 1897 Law and the Administration of Estates Act 1925 being limited to land in England and Wales. STEP should perhaps take note.

It is that point that is crucial to the correct and orderly administration of English law abroad to the extent that it is called upon in aid by foreign friendly jurisdictions. The common law concept of direct seisin can apply to foreign immovables in a unitary context as it has not been overridden or expressly "repealed" outside the Anglo-Welsh jurisdiction. Under the EU Regulation generally, and in this case, the Montenegrin private international law certification, it is the foreign jurisdiction applying English law, not the English courts.

It will be apparent to the reader that the case of the Montenegro immovable could have been resolved expeditiously with a little knowledge of what the law of England was prior to 1897, and still remains.

Objections have been raised by elaborate legal engineers as to renvois being required. Renvoi is a tool, not a law or a legal requirement per se. Its sole justification and application lies in the area referred to as that of the Conflict of laws, not in general law. Where there is no conflict, it is unnecessary and frankly a waste of time and energy equivalent to complete destruction of the estate in the Dickensian case of Jarndyce v. Jarndyce (available at all good booksellers). The EU Succession Regulation has deliberately and intentionally put renvoi back in its box, and sealed it in, in relation to internal EU successions by an adaptation process. However, in order not to deregulate successions with third states, it has been admitted in relation to Third States' laws as an exception. Where is no conflict, there is no need for renvoi. It is not a law. What is more, the renvoi concerned is a European concept, it is not an English one. Those reading the preparatory documentation submitted prior to the drafting of the Regulation will appreciate that there are significant differences between the English concept and that for example prevalent in German law.

I would refer the reader to the fundamental differences as to Renvoi and its application isolated by the German Notarial Institute s compiling the Rapport Final: Synthèse et Conclusions of 18 septembre/8 novembre 2002. The summary at page 59 clearly shows that there is no fundamental and comprehensive common ground as to what renvoi is as between all Member States concerned. There are different mechanisms by which for example, each court decides which law to follow, whether it sits as itself or as a foreign court or then apply other mechanisms for different reasons in different areas and classifications of law. I can only echo John Pawley Bates' Notes on the doctrine of Renvoi commentary in stating that the word term renvoi in itself is fallacious as it implies a sending back, which is not a full description of the legal phenomenon at all, particularly in the case where the jurisdiction or legal system to which the issue is sent by the adjudicating forum retains jurisdiction and does not send it elsewhere or back. He cites the German terms Rückverweisung and Weiterverswiesung to illustrate that fundamental distinction.

Might I suggest this "Jack in the box" is still a troublesome pest despite it being eradicated from the European law of succession by the Regulation? The reference to renvoi made in article 31 of the Regulation as being applicable to the law of habitual residence or the continental lex domicilii, where it is applied is within the context of good order, it does not render renvoi a principle of law. It is a tool, no more.

Considerant 57 of Regulation (EU) n° 650/2012 states:

The conflict-of-laws rules laid down in this Regulation may lead to the application of the law of a third State. In such cases regard should be had to the private international law rules of that State. If those rules provide for renvoi either to the law of a Member State or to the law of a third State which would apply its own law to the succession, such renvoi should be accepted in order to ensure international consistency. Renvoi should, however, be excluded in situations where the deceased had made a choice of law in favour of the law of a third State.

Renvoi is therefore limited to what is necessary to ensure international consistency, whatever that might mean.

renvoi to the lex rei loci sitae is not therefore required where English law applies the same or equivalent principle as the lex rei loci sitae. Renvoi is not a law, it is not orthodoxy or doctrinal either.

Article 34 (1) refers to conflict of laws, not to a position where there is no conflict.

1. The application of the law of any third State specified by this Regulation shall mean the application of the rules of law in force in that State, including its rules of private international law in so far as those rules make a renvoi:

(a) to the law of a Member State; or

(b) to the law of another third State which would apply its own law.

2. No renvoi shall apply with respect to the laws referred to in Article 21(2), Article 22, Article 27, point (b) of Article 28 and Article 30.

In the Montenegro case, by way of example, were the English doctrine of direct seisin to have been applied, then there would have been no conflict to resolve. It is simple, where there is no conflict, as there appears to be none, between the civil law concept of le mort saisit le vif in simple French and direct seisin, Renvoi to the law of an EU States is not required, where the same principle applies in both jurisdictions. To argue from a Third State perspective as certain commentators are doing that the "law" in a unitary context requires a renvoi is futile.

Rereading pages 6-16 of Dicey's Introduction to his second 1908 Edition pages demonstrates the fallacy of assuming that renvoi is a rule of law and that Conflict of laws is a separate set of legal rules - I cite that edition as it is the one following on from the 1897 Law- they are not, for the reasons Dicey sets out. It is a cold shower for those who believe that renvoi and scissionism/duallism are absolutes rather than tools of the profession.

I therefore urge practitioners faced with these issues to consider reconfiguring their applications for relief abroad along the lines of Direct Seisin, citing the common law of England, if for any reason there is an immovable situated in a jurisdiction that uses the concept of direct seisin or an equivalent as its own manner of transferring immovables on death. I stress that the Cridon of Lyon has heard my proposal and is deploying it amongst its French notary members without any apparent difficulty. This has been confirmed by an English notaire practicing in a well established in the French Alps The main issue with Direct seisin in England was that debts could not be recovered without a mortgage surety or guarantee. The English rules are clearer now and can be used in the French succession by the notary administering the estate under the Regulation, thus avoiding fraud.

The point is that in the framework of the EU Succession Regulation n° 650/2012, English law as it stands leaves the questions of the administration of the estate prior to its devolution or distribution in the hands of the lex fori. That includes the collecting in of the assets and the payment of creditors. The direct seisin principle applies only when the estate has been finalised. Those who fear a return to the bad old days when the English nobility or landed gentry were able, in the absence of a mortgage charge, to elude neo-capitalistic creditors seizing their lands may need to think again. That is dealt with by the lex fori, and there is no renvoi from English law to the lex fori which is already seized of the issue as such by the Regulation. The English language version of article 23 of the Regulation which probably will not be replaced by Gaeilige as from the Saint Sylvestre, reads as follows as to the scope of the applicable law:

2. That law shall govern in particular: ...

(f) the powers of the heirs, the executors of the wills and other administrators of the estate, in particular as regards the sale of property and the payment of creditors, without prejudice to the powers referred to in Article 29(2) and (3);

(g) liability for the debts under the succession; ...

"Governing" does not induce the actual application of the law of England as to priority and payment of creditors, the Regulation leaves that by necessity to the EU competent court or the notary or the heirs administering the succession. The term "shall regulate" is not used. The actual provision as to any renvoi cited above reads as follows, and does not preclude the application of the English rules as to the priorities of creditors or their payment by the EU person charged with the administration of the succession.

1. The application of the law of any third State specified by this Regulation shall mean the application of the rules of law in force in that State, including its rules of private international law in so far as those rules make a renvoi:

(a) to the law of a Member State; or

Neither does it preclude the use of the law of the Member State concerned in a case governed by the habitual residence of the deceased, rather than any option made by the deceased for the application of the law of their nationality.

"Unitary" does not mean foreign court theory: it has replaced it in Europe.

Peter Harris