Case C-20/17 Oberle on the EU Succession Regulation – The rise of a true European property law?

On 21 June 2018 the CJEU took its third decision after the EU Succession Regulation entered into force on 17 August 2015. The EU Succession Regulation is a revolutionary piece of EU legislation with very far reaching effect on national law. Although many authors have tried, both during the process of negotiations and after its adoption and entry into force, to limit the effects, the effects turn out to be far reaching indeed. In short, the EU Succession Regulation allows for a single legal system to apply to an entire succession estate and introduces a European certificate of succession that can serve as evidence throughout the EU of the rights and obligations arising under that succession regime, which is to be issued by a single competent authority.

The first decision, Kubicka (Case C-218/16 of 12 October 2017), dealt with the recognition and material application of foreign ways to acquire property rights. In that case a Polish national explicitly wanted to choose Polish law as the law applicable to her succession. She co-owned a house with her husband in Germany and wanted to choose Polish law to enable her to make a legacy ‘by vindication’ (legatum per vindicationem) to her husband, avoiding administrative difficulties for her minor children in case she would die. The Polish notary that she approached refused cooperation as he held (correctly) German law only uses the legacy ‘per damnation’ (legatum per damnationem) in which the heirs (in this case including the children) become owner and must transfer ownership of the object to the legatee. The CJEU held that such refusal was precluded under the EU Succession Regulation and that a single legal system (Article 23(1)) governs the succession as a whole. Therefore, the legacy by vindication had not only to be recognised in German law, but also to be (materially) applied. A revolutionary result, opening op the traditional exclusive power of member states to determine the ways in which property rights can be acquired. 

This third decision, Oberle (Case C-20/17 of 21 June 2018, which follows Case C-558-16 Mahnkopf on the content of the EU certificate of succession)), deals with the other central issues of the EU Succesion Regulation: the competence to issue certificates of succession. These certificates of succession, which can take different shape and form throughout the EU (in some countries issued by courts (such as Germany), in some by notaries (such as the Netherlands)), are traditionally given by the competent authority in country where property is situated (lex rei sitae). The main question in this respect arising after the entry into force of the EU Regulation is whether such competent authorities still have this power notwithstanding the competence of a colleague to do so under the rules of the EU Regulation?

In this case there is an international succession whereby a French national has his last habitual residence in France and has not made a choice of law. The deceased had an estate that contains both French and German property and leaves behind two sons. One of the sons, mr. Oberle, obains a national French certificate of succession and tries to aproach a German court to declare that he and his brother co-own the house in Germany by issuing a German national certificate to that effect limited to the German property. The EU Succession regulation points to French law and French jurisdiction in these cases. The German court therefore refused to cooperate, but in appeal the court had doubts and issued a question to he CJEU in a preliminary reference procedure.

The Gesetz gum International Erbrecht und zu Änderung von Vorschriften zum Erbschein sowie zur Änderung sonstiger Vorschriften of 29 June 2015, which entered into force on 17 August 2015, is clear about this: it allows German competent authorities to still provide a national certificate of succession.

The answer of the EU Court is negative. The EU Succession Regulation creates a single regime and therefore the situation in which there are two certificates certifying information about the same object should be avoided. The Court states to this effect:

56      As was recalled by the Advocate General in points 109 and 110 of his Opinion, the Court has thus already held that an interpretation of the rules of Regulation No 650/2012 which would lead to the fragmentation of the succession would be incompatible with the objectives pursued by that regulation (see, to that effect, judgment of 12 October 2017, Kubicka, C‑218/16, EU:C:2017:755, paragraph 57). Indeed, as one of those objectives is to establish a uniform regime applicable to successions with cross-border implications, achieving that objective involves harmonising the rules relating to the international jurisdiction of the courts of the Member States in both contentious and non-contentious proceedings.

57   An interpretation of Article 4 of that regulation whereby that provision determines the international jurisdiction of the courts of the Member States as regards the procedures for issuing national certificates of succession seeks, in the interests of the sound administration of justice within the European Union, to achieve that objective, by limiting the risk of parallel proceedings before the courts of different Member States and of contradictions that may arise as a result.

58      Conversely, achievement of the objectives pursued by Regulation No 650/2012 would be hindered if, in a situation such as that at issue in the main proceedings, the provisions of Chapter II of that regulation, in particular Article 4 thereof, were to be interpreted as not determining the international jurisdiction of the courts of the Member States in relation to proceedings concerning the issuing of national certificates of succession.

59      It follows from all of the foregoing that Article 4 of Regulation No 650/2012 must be interpreted as precluding legislation of a Member State, such as that at issue in the main proceedings, which provides that, although the deceased did not, at the time of death, have his habitual residence in that Member State, the courts of that Member State are to retain jurisdiction to issue national certificates of succession, in the context of a succession with cross-border implications, where the assets of the estate are located in that Member State or the deceased was a national of that Member State.

This, for the moment, decides the direction the CJEU is taking with the EU Succession Regulation. It is certainly taking the EU side of the matter. For the EU citizen, this is good news: you can do actual business with one single notary and be ensured, more than before, that your estate planning will work in the way you intend it to work. Of course you can’t do everything you want: the next frontier seems the recognition of foreign property rights and the scope of the public policy exception. What parts, in other words, of national property and succession law, regardless of the promise made in the Recitals that the Regulation does not affect the national systems of property law, will remain for the Member States. Recognition and application of each other’s law seems not only inevitable, but also the right way to go if citizens are to have one single area of justice.