Solving the Multi-Jurisdictional Puzzle: Which Law Applies? – Civil right
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Increasingly, people and their assets have ties to multiple jurisdictions, rather than just one as in the past. Over the course of a lifetime, many of us will leave behind real estate, bank accounts, investment accounts, retirement savings plans and pensions, as well as beneficiaries and other ties spread across many many different places.
But what happens at death to determine which law will apply? The body of law called “conflict of laws” creates rules to determine the applicable law to govern the succession in the event of death. The rules are complex, sometimes vague, and vary widely between common law jurisdictions, such as Canadian provinces and territories (except Quebec), United States, England and Wales, Australia and New Zealand, and civil law jurisdictions such as Quebec, France, Italy, Japan and most Latin American countries, and many more.
Common law countries deal with questions of succession based on a two-pronged approach: the “domicile” of a deceased person, or the location of the property, in legal terms called “situ”.
Domicile is an intriguing concept, and in short, it means where a person’s permanent home is. Everyone must have a home, and we are each born with one by right, what is called a “home of origin”.
Your original domicile never changes, but it can be suspended by the acquisition of a “domicile of choice”, for which two elements must be present: the acquisition of a residence in a new place, and the intend to stay there permanently. Determining intent requires a detailed examination of the facts, and there is no precise formula. So you can see how it can lead to litigation later on if it’s unclear whether someone has moved or not.
In the two-pronged approach used by common law jurisdictions, the other important concept is that of the location of the property or “situs”. Real estate is simple – it is located where the land itself is. For tangible property, such as jewelry, furniture, and vehicles, the general rule is that they are where they are.
For several other categories of assets, including intangibles, such as debt and shares, the rules of situs are more complex.
Under common law rules, the applicable law to determine a matter of succession will depend on whether the property is “movable” or “immovable”. Buildings include land and interests in land, such as a lease or life estate. Personal property includes the remainder of a deceased’s estate, other than real estate, including intangible assets in most cases.
For most estates, if the property is moveable, wherever it is located, its estate will be governed by the domicile of the deceased. But if the property is a building, the succession will be governed by the place where it is located, or in succession terminology, located.
For example, if a person dies without a will, the right to his property intestate will depend on the application of possibly two rules: the domicile of the deceased for his movable property and the law of the place where his immovable property is located for their property. real estate.
An example based on a real case from 2014, Vanston v. Scottis useful for understanding how these rules may apply in practice.
At issue was which law should apply to determine the succession to the movable property of the deceased in the event of death. The plaintiff wife claimed it was Saskatchewan, and the defendant’s children claimed it was British Columbia.
The children wanted to challenge the will, as the deceased left most of his estate to his second wife and excluded the children from his first marriage. British Columbia has liberal legislation that can allow a court to change the terms of a will, including where adult children have not been adequately cared for. The deceased was born in Alberta (his original home) and died in Kelowna, BC. He practiced medicine in British Columbia for many years, then moved to Saskatchewan to work. He met his second wife shortly after moving, who was residing in British Columbia. After several years, she moved to Saskatchewan. The deceased lost his job and spent several months looking for work across Canada. Without finding new employment, he and his wife returned to British Columbia, sold their condominium in Saskatchewan, stored furniture and moved a large number of personal effects to a short-term rental property in British Columbia, and registered their car in British Columbia. After arriving in British Columbia, the deceased and his spouse traveled abroad in search of employment, with a view to working outside of Canada. The deceased died shortly after returning from his international job search.
The court ruled that the deceased had abandoned Saskatchewan as his chosen home when leaving the province, but that although he had acquired a residence in British Columbia, he had no indefinite intention of living there. Although the deceased had not resided in Alberta for more than 25 years, the expected court — to the surprise of the parties — found that his original Alberta home had come back to life, and that he had abandoned his former home of choice (Saskatchewan), without yet acquiring a new one.
Civil law jurisdictions have different rules for determining applicable law, often based on the nationality of the deceased. On August 17, 2015, the European Union adopted the
EU Succession Regulation which applies to all EU Member States except Denmark and Ireland, which have opted out. In most cases, the “last habitual residence” of a deceased person will determine which laws of the country will apply. Again, this is a factual determination that can also certainly give rise to disputes.
When it comes to conflict of laws, estates and deceased persons that cross borders or have multi-jurisdictional connections, there is significant complexity and a great deal of uncertainty.
Solving the multi-jurisdictional puzzle is not an easy task and, as we see in the case above, can sometimes lead to surprising results.
The content of this article is intended to provide a general guide on the subject. Specialist advice should be sought regarding your particular situation.