ARTICLE
27 April 2023

The Advance On The Inheritance Share: A Solution For A Partial Release Of The Estate

CP
CMS Pasquier Ciulla Marquet Pastor & Svara

Contributor

CMS Monaco is a leading law firm, providing local and international clients with a one-stop shop service for all their legal challenges, both in counselling and litigation. The firm was created in 2009 and is strongly anchored in the Monegasque market and well familiar with its dynamic economy. In 2017 the firm joined CMS, an organisation of independent law firms, composed of 80+ offices in 45+ countries, with over 6,000 lawyers worldwide, making it the only law firm in Monaco with such significant international reach. Today CMS Monaco is composed of 80+ professionals, including five partners (Avocats Associés Monégasques) and over 50 associates, experts in Monegasque law. The firm is structured around seven practice groups: Private Clients, Business Law, Real Estate & Construction, Employment, Banking & Finance, Tax and Criminal law. The teams regularly work together on complex cross-practice cases with high stakes for a large variety of Monegasque and international clients, such as companies of various sect
It is a well-known fact that settling an estate takes time, partially due to the necessity to carry out the administrative and legal formalities and the division of assets.
Monaco Wealth Management

It is a well-known fact that settling an estate takes time, partially due to the necessity to carry out the administrative and legal formalities and the division of assets.

In some cases, the heirs and/or legatees of the deceased do not agree with each other and can't reach an agreement, either on the composition of the estate or on its division.

The disagreement then inevitably becomes a cause of blockage of the estate, which can prevent any progress from being made for months or even years, if there is litigation.

It is also possible to face a deadlock when the estate is particularly complex and requires financial expertise to reconstitute the assets, as is often the case in an international context.

Thus, heirs and/or legatees cannot claim their share of the deceased's estate, let alone enjoy it, for an undetermined period.

Is there a solution?

Fortunately, the situation is not inextricable: heirs do not have to wait for the division of the estate to start benefiting from a part of their inheritance and/or legacy.

They can obtain an advance on their inheritance share.

What are the conditions to apply for an advance on the inheritance?

The advance on the inheritance is allowed under Monegasque case law which requires several conditions to be met to implement it.

The essential existence of joint ownership of the estate

An application for an advance on the inheritance is only possible when the heirs hold the inheritance assets in joint ownership.

It means the heirs indistinctly own the assets, and their share is not materially individualized.

The advance must not exceed the foreseeable rights of the claimants

Since the goal is to provide heirs with a provision based on their rights in the estate before its settlement, the advance they request must not exceed their foreseeable rights.

Hence, for the application to be admissible, the amount requested by way of the advance cannot exceed what the heirs are likely to obtain in the context of the division of the estate.

The presence of cash in the undivided estate

Furthermore, even if the claim does not exceed the foreseeable rights of the claimant heir, for such a claim to have any chance of success, the undivided estate must have available funds.

Indeed, to make the advance, no asset should be divided. Thus, the said advance can only be in cash.

Therefore, to obtain an advance on their share, the heirs must ensure that part of the estate's assets is cash flow and not only real estate or securities portfolios.

How can an heir or a legatee claim an advance of their inheritance share?

The request for an advance on the inheritance can happen in amicable terms, provided that all the heirs and/or legatees agree on the principle of the advance and on the amount requested by those who initiated it.

If the amicable route is not conclusive, the judicial proceedings are open to the heir or the legatee, who can address this claim in the context of the liquidation and division of the estate proceedings.

Even though they cannot speed up the settlement of an estate that is dragging on, the heirs and/or legatees may apply for an advance on their inheritance share, which enables them to move forward and start benefiting from their share.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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