WELCOME to our common evening event and presentations ... · Attorney at law and Notary, M.B.L. Certified Specialist SBA Inheritance Law Zug, 8th November 2016 . Incapacity to act

WELCOMEto our common evening event and presentations about

Death and Inheritance in Switzerland

Dr. Roland BruhinAttorney at law and Notary, M.B.L.

Certified Specialist SBA Inheritance Law

Zug, 8th November 2016

Incapacity to act

What happens if you are no longer capable of judgement?

Death and Inheritance in Switzerland 2

Summary

1. The KESB

2. The Advance Care Directive

3. The Patient Decree

4. Legal Situation without Advance Care Directive / Patient Decree


What is KESB?

KESB = Kindes- und Erwachsenenschutz Behörde

= Child and adult protection authority


VORSORGEAUFTRAGThe Advance Care Directive

Art. 360 Swiss Civil Code

1 A person with capacity to act may instruct a natural person or legal entity to take

responsibility for his or her personal care or the management of his or her assets or to act

as his or her legal agent in the event that he or she is no longer capable of judgement.


The Advance Care Directive

Execution

• Prerequisites: Full legal age and capable of judgement

• Holographic form → handwritten from beginning to end including date and signature

or

• Notarized by a notary public

• Possibility of entry in the Civil Register

6Death and Inheritance in Switzerland

The Advance Care Directive

Coming into effect

• Loss of power of judgement with respect to the affairs stipulated in the Advance Care

Directive

• Validation of the Advance Care Directive by the KESB


PATIENTENVERFÜGUNGThe Patient Decree


1 A person who is capable of judgement may specify in a patient decree which medical

procedures he or she agrees or does not agree to in the event that he or she is no longer

capable of judgement.


The Patient Decree

Execution

• Prerequisites: Capable of judgement, full legal age not required

• Written form, dated and signed

• Possibility of entry on health insurance card


The Patient Decree

Coming into effect

• Loss of power of judgement

• Attending doctor’s duty to ascertain existence of Patient Decree on patient’s health

insurance card

• Provisions of the Patient Decree are binding for the attending doctor


Legal Situation without Advance Care Directive


• Right of spouse to act as representative regarding legal acts required for usual support

and usual management of assets

• Right of spouse to open and deal with mail, if necessary

• Consent of Adult Protection Authority required for acts exceeding the ordinary asset

management

• If person is unmarried/divorced or spouse not suitable to act as representative

→ Adult Protection Authority will take measures respectively establish a deputyship


Legal Situation without Patient Decree


Hierarchy of persons entitled to represent the patient and to grant or refuse consent to

planned medical procedures:

1. Deputy appointed by Adult Protection Authority

2. Spouse who cohabits with patient or regularly provides support

3. Any person who cohabits with patient and reguarly provides support

4. Descendants who regularly provide support

5. Parents who regularly provide support

6. Siblings who regularly provide support


Last Will / Contract of succession

Death most often comes unexpected.

What, if there is neither a last will nor a contract of succession?


Example

14

Marissa

(Dutch

citizen)

Paul

(US-

citizen)

Jim


What was the situation?

15

• Paul was not married but happily allied with Marissa, both of them living and working in

Switzerland based on seperate staying permits

• The two of them have had a common son called Jim

• Paul died in Switzerland and left neither a last will nor a contract of succession

• There were assets of the deceased in Switzerland, the Netherlands and in the USA

• For some bank accounts and insurances Paul had appointed Marissa as a beneficiary


What happened?

16

• The Child and Adult Protection Authority (KESB) has established a deputyship for Jim and

appointed a lawyer as the deputy

• Marissa no longer was allowed to dispose of assets of the deceased or of Jim

• It was not clear which assets, if any, belong to the estate

• It was not clear which law was applicable, and if there is, if any, a statutory entitlement

• It was not clear whether Paul intended to appoint Marissa as a beneficiary for the estate

From a pure Swiss point of view son Jim was the only heir

• The deputy had to initiate a probate proceedings in the USA


What could have been avoided?

17

• Paul could have disposed of his assets in a last will or in a contract of succession to

determine who the heirs are and, to what extent

• He could have determined which law will be applicable

• He could have appointed an executor


Death and Inheritance in Switzerland How to make dispositions

MLaw Christophe Raimondi, LL.M.Attorney at law and Notary


Summary

In a nutshell

How to make dispositions under Swiss law

• Last Will (Testament)

• Contract of Succession

Amendment and revocation


In a nutshell


Testamentary Dispositions

Last Will (Testament)

unilateral act

Contract of Succession

agreement

Last Will (Testament)

A will may be established (i) by public deed or (ii) in holographic form…


Public Deed

Prepared by a Notary

Holographic Will

Entire document handwritten, dated and

signed by testator

Pro

s

• Higher legal certainty, lower risk of

being challenged (validity +

content)

• Better recognition by foreign

authorities

• Nobody else required, might be kept fully

secret during a lifetime

• Does not entail any costs

Co

ns

• More time-consuming

• Costs in Zug approx. CHF 1‘500 –

2‘000

• Higher risk of being challenged

(ambiguous wording)

Contract of Succession

Contract between two or more persons in which at least one person commits him-/herself in his/her lifetime either by

- (a) renunciation of inheritance (with or without valuable consideration), or

- (b) provision of benefits between living persons, i.e. via a nomination as heir (extensive) or the passing on of a legacy (limited)

(same formal requirements as a last will by public deed – contact your Notary)


Pro

s

• Possibility to clarify issues directly, in advance and exhaustively with the co-/heirs

• Possibility to agree on a consideration for the renunciation or the provision of benefits

between living persons

Cons • Requires the involvement of co-/heirs

• More time-consuming than a Last Will, costs in Zug approx. CHF 2’000 – 3’000

Amendment and revocation [1/2]Last Will

The testator may amend/revoke his Last Will anytime/in full or in part…

How?

• Directly on the public deed/document

• By destruction of the public deed/document

• Through a new Testamentary Disposition (by public deed or as holographic will)

Mind the form - at least holographic will!

Keep new disposition clear and unquestionable


Amendment and revocation [2/2]Contract of Succession

A Contract of Succession may be amended (new contract – public deed) or revoked

(written agreement – no public deed) at any time by agreement between the parties…

Exceptions (unilateral termination or termination by operation of law)

• Heir’s/legatee’s conduct toward the testator constitutes a ground for disinheritance

• In case of provision of benefits between living persons, failure to perform or to furnish security for them

• Where the heir/legatee does not survive the testator (unless other provision in the contract)

• In case of divorce (unless other provision in the contract)


Death and Inheritance in Switzerland Estate Planning Possibilities

Dr. Stefan KlassAttorney at law and NotaryCertified Specialist SBA Inheritance Law



Overview

1. Matrimonial property regime

2. Essentials of estate planning dispositions

3. Cross border issues


Matrimonial Property Regime 1

Death of a married person

• Dissolution of the matrimonial property regime as first step

• Each spouse gets its quota according to the agreed matrimonial property regime

• Quota of the deceased spouse forms its estate which is then distributed according to the

rules of the inheritance law



Cross border issues

• Applicable regime in international situations

to be determined on a case-by-case basis

• Choice of the applicable law possible

even with retroactive effect



Matrimonial property regimes according to Swiss law

1. Separation of Property

2. Participation in accrued Gains

3. Community of Property

Matrimonial agreement of spouses



Participation in accrued Gains

• Individual property of each spouse

• property at marriage

• gifts and inherited property

• personal belongings

• Gains accrued during marriage



Planning Opportunities

• Accrued gains may be split other than 50:50 IF there are only common descendants

• The entire value of the accrued gains may be granted to the surviving spouse


Essentials of Estate PlanningDispositions 1

Wills and contracts of succession

• Allow individual solutions

• Choice of home law

• Executor



Freedom of Testation

• Freedom of testation as guiding principle

• Limitations by statutory entitlement (“Pflichtteil”) rules

• May be waived by protected heirs

• Choice of home law without statutory entitlements

is recognized under Swiss law



Statutory entitlement

• Step 1: calculation of entitlement of relatives or the surviving spouse as if no estate planning disposition

had been drawn up

• Step 2:calculation of statutory entitlement which is

75% for descendants

50% for parents

50% for surviving spouse

• Rest of estate may be granted to third persons

• Calculation in CHF, all items of the estate

valued at fair market prices



Example

• Husband dies, leaves mother, wife and 2 children

• Step 1:

0% for mother

50% for surviving spouse

50% for the 2 children

• Step 2, calculation of statutory entitlements:

25% for surviving spouse (50% of 50%)

37.5% for the 2 children (75% of 50%)

37.5% available for grants to third persons



Outlook:

• Reduction of statutory entitlements of spouse and descendants possible in upcoming

amendment of Swiss inheritance law


Cross Border Issues 1

Principles of jurisdiction

• One single estate including all assets worldwide

• Splitting of estates possible regarding foreign real estate

• Courts and administrative authorities of last domicile in Switzerland have jurisdiction over

probate proceedings and inheritance disputes



Governing law

• Competent Swiss Courts and administrative authorities apply their own procedural rules

• Swiss wills and contracts of succession are subject to Swiss law

• Foreign nationals (not in case of dual citizenship) may choose to apply their home law for

their entire estate



Existing wills drawn up under foreign law

• Remain valid if validly drawn up under foreign law

• But: valid choice of home law?

• But: dealing with assets in Switzerland?



EU Succession Regulation

• Applies to successions after August 17, 2015

• Not applicable in the UK, in Ireland and Denmark

• Likely conflict of jurisdictions if assets in the EU combined with EU citizenship, also for

UK, Irish and Danish nationals


Documents

WELCOME to our common evening event and presentations ... · Attorney at law and Notary, M.B.L. Certified Specialist SBA Inheritance Law Zug, 8th November 2016 . Incapacity to act