Antonio Flores’ Blog

The effects of Brexit appear to have reached some Spanish government offices, 
inclusive of Courts of law. The Directorate General of Registrars and Notaries (DGRN), a regulatory body equivalent to the UK Notaries Society, has recently issued a startling ruling (14 Sept. 2016) rejecting the validity of all Powers of Attorney (PoA) granted by a qualified United Kingdom “Notary Public”, on grounds that the authority and competence of these British professionals is not equivalent to that of their Spanish peers.

The ruling went as far as unbelievably stating that only UK-qualified “notaries-at-law” or “lawyer notaries” could validly issue powers of attorney, negating this prerogative to plain “notaries public”.

As was expected and with immediate effect, the erratic decision sent shock waves throughout the network of thousands of professionals, directly or indirectly, involved with expat legal work. And for a reason: hundreds of Court cases could be dismissed (one of Lawbird Legal Services’ case among many), thousands of property transactions could be voided (on the upside, along with their mortgage loans) whenever such PoAs were used and overall, legal chaos.

Alerted by this misguided ruling, the Notaries Society, based in Ipswich, issued the following statement:

1. A Notary is a qualified lawyer whose work is recognized internationally, unlike the work of Solicitors. The primary function of a Notary therefore, is the preparation of documents and the authentication of clients’ identities and signatures principally for use abroad.
2. Some Notaries are also “Scriveners”, who mostly operate in London.
3. “Notaries-at-law” or “lawyer notaries” do not exist as a separate profession.

Hundreds of Spanish Notaries and Registrars, fully aware that their regulator´s historical cock up would certain bring embarrassment to their reputation but more importantly, cause incalculable financial damage, have taken an unusual step: completely ignore this binding ruling and fully accept the Powers of Attorney correctly granted by UK Notaries Public.

And as if to soften the blow, the International Law Registrars Council has issued a non-binding report where it is confirmed that documents signed by UK Notaries Public, who are appointed by the Archbishop of Canterbury and are regulated by laws as ancient as the Ecclesiastical Licenses Act 1533, an Act of the Parliament of England.

Antonio Flores Legal Practise, Property POA UK Spain, Power of attorney conveyance property spain, Power of attorney conveyancing property spain, Power of Attorney UK Notary Public, Spanish Wills, Use of UK POA Spain

Newspaper ABC has exposed a worrying trend: since 2007 110% more of eligible heirs to Spanish inheritance have renounced to their portion of the estate because there is more debt than equity to inherit.

According to the Notarial Council General, it’s a shame that so many people take the route of renouncing the inheritance, without knowing whether indeed the liabilities exceed the assets, just because it is not possible to have a clearer picture of the financial situation of the deceased prior to going in front of a Notary.

But Spanish Notaries remind us that the Spanish Civil Code has a solution for this: to inherit subject to “benefit of inventory”. This allows the inheritor to have the right to obtain the exact situation with the estate of the deceased testator prior to becoming a full inheritor but at the same time, accepting the designation if finally, there are assets worth inheriting. In other words, debts that are inherited will be covered by assets from the estate, not the inheritor.

For example, beneficiaries of a will written by victims of banks implicated in the Equity Release fraud are advised to choose this route to avoid becoming personally responsible for the mortgage loan that was sold fraudulently as the miracle product against Spanish Inheritance Tax.

This method of inheriting also allows inheritors to litigate against creditors (banks for instance where miselling took place) without becoming personally liable for it.

Finally, if all inheritors renounce to the inheritance, the Spanish State will be eligible to receive it although, subject too to debts not being higher than the part of the estate that is really worth something!

Antonio Flores Inheritance, Litigation herencia beneficio inventario, spanish inheritance tax, Spanish Succession, Spanish Wills

Viewers of this post may initially be lost with the title of it, but will soon know what I am writing about. As we say in Spain, there is a lawyer and a doctor in each family, even if no member of it has finished high-school, given the abundance of advice you tend to get from some family members when you have abdominal pain or you are about to sign a rental agreement with a tenant.

In the Costa del Sol, and definitely in the rest of Costas, many foreign individuals seek advice for legal issues, but they use neither traditional legal advisers nor less formal legal sources. Instead, in the majority of cases (reportedly three quarters!) they obtain advice from family and friends, and from a broad range of non-legal professionals, including professionals working in many other fields who are known to the information seeker. They also have the habit of roaming through expat forums with the hope of getting the answer they wish to listen, and which rarely conforms to reality (unfortunately). Thus, there appears to be an informal network of non-legal practitioners who are routinely consulted by people with legal problems and who have created a parallel case law which is simply wrong.

You will know what I am writing about when you read some the beliefs spread in our Costas during years of pseudo-legalese innuendo, hearsay and gossip in bars and pubs, “chiringuitos”, Christmas Dos and other socializing events appropriately lubricated with abundant booze. Lets start with a few:

Spanish Wills & Inheritance

1. Die without a will and the Spanish Government will snap up everything: this is a classic I must have clarified at least 999 times. NO, Spanish law does not say this, it says that if you die without a will then you die intestate, in which case your personal national law applies, and only if no inheritors turn up will the Spanish Government ultimately claim ownership (someone has to!). As an example, according to Hubert Bocken and Walter de Bondt (Introduction to Belgian Law) most Belgian married people with children die intestate and therefore Belgian rules will apply, with usufruct rights passing to the heirs. This will happen too to any Spanish property or asset owned by a Belgian national because his/her law says so.
2. My English will is not valid in Spain: it is perfectly valid but it needs to be translated, legalized and the authorship confirmed by the Spanish Courts. Of course, it better include Spanish or worldwide assets because otherwise it has not relevance. The best option in this case is to obtain grant of probate by the Courts that can then be legalized and translated for its use in Spain.

Spanish Rental agreements

1. My tenant is not paying, I will change the locks: FORGET IT, you can end up in the gallows for this because it is trespassing.
2. My tenant is not paying; I will cancel the electricity and water supplies: CAREFUL, doing this is punishable under the Spanish Criminal Code as it is considered to be coercion and/or harassment.
3. My landlord has not made some repairs I have asked him to do so I am deducting the repair costs from the rent. NO, if you do this you can get evicted. Rent has to be paid every month, religiously, and if you want to ask him to carry out remedial work on the property you have to notify him formally. They are 2 separate issues and cannot be mixed up because the law has established this.
4. I have an 11 month contract which I am told is short term and so I will be able to kick the tenant out on expiration of the term: FALSE, all residential rental contracts can be challenged and extended up to 5 years, optional for the tenant and mandatory for the owner. A registration certificate with the local Town Hall will suffice to invoke this.
5. My contract is in German so it is not valid: A very common fallacy. Any document which can be translated by a registered or certified translator or interpreter is valid in a Court of law.

More to come on my next Post!

Antonio Flores Inheritance, Property legal gossip, rental contract spain, rental contracts in spain, rental spain, spain will, spanish tenancy agreement, Spanish Wills, will in spain

It has been widely believed that British citizens who own property in Spain will invariably be subject to English law, which determines freedom of disposition of assets, as opposed to the more restrictive Spanish inheritance law where children will get 2/3 of the estate and the spouse the life interest of one third (and who may not be the preferred choice of the testator/testatrix!).

The reason for this is that under Article 9.8 of the preliminary title to the Spanish Civil Code, succession to all property, whether movable or immovable and wherever situated is determined by the law of the deceased’s nationality, in our case, English law, which takes relevance but surprisingly, it conversely stipulates that for property located abroad it will be the laws where the property is located which are to be applied. And in Spain forcible inheritors will almost always challenge a will if they don’t receive what they are supposed to get according the Spanish Civil Code, unless of course there are more debts than assets!

The above legal quarrel between both legal systems is now resolved by the Spanish Supreme Court, in various rulings, to the effect that if a British testator dies in Spain and:

• has moveable assets and property only in Spain then Spanish law applies.
• has property in the UK and Spain then English law applies.
• has movable assets in Spain only then English law applies.
• has property in Spain and assets in the UK (but not property), then Spanish law applies.

It normally happens that if no inheritor challenges the application of English law, which is normally typed into the will as the governing law, it will apply regardless of the above.

Antonio Flores Inheritance Spanish Inheritance Law, Spanish Wills, Wills in Spain