A client from UK called me a while ago asking about whether it is better to include his China real properties in his will made in UK or he should prepare a separate will for his China assets.
I have seen a lot of discussion and articles on Internet regarding such a topic. However, I believe there may not a one-size-for-all solution. Sufficient regard shall be given to client’s specific situation when analyzing and giving advice.
Since the client has domicile and habitual residence in UK, not in China, the law governing the will is English law, which makes it difficult for China notary offices and courts to decide on the validity of the will made in UK. However, if the will is duly probated in UK and affirmed as valid by UK courts, then that will basically clear the way for the will to be recognized in China.
So if we prepare a separate will for his China assets only, then upon death of the client, is it possible to have UK court probate his will made only for China assets? Our team research found that in Australia there is a rule saying local courts won’t admit such a will into probate proceeding if there is no local estate under the will.
If it can be probated, then a separate will can be a good idea assuming the probate proceeding for such a will could be quick before a grant of probate is issued.
Can you explain why you would not prepare a valid Chinese will for the Chinese assets and admit that directly to probate in China? That would presumably avoid translation and the need to prove the validity of an English will to the relevant Chinese Court or authorities.
(I appreciate this does not answer your question!)
A separate will made in UK by the UK client will be governed by UK law according to China law on choices of laws (private Internationa laws). So a will Iike this will have problem of being recognized as valid by China notary office if not probated in UK.
Please note that China does not have a probate process, meaning no court invention in the course of inheritance. When there is no dispute, we help clients get inheritance done by way of notarization which simplifies the process of inheritance of China estates by foreigners without resorting to courts in China.
If such a separate will made in UK can be easily probated in UK court, then it will much solve the problem of being recognized as valid by china notary office, which in turn will avoid the inheritance matter being elevated to court. That is the best option for clients.
22 Sept 2020.
Dear Jason,
First of all be very careful. I note your firm name which indicates you are based in the PRC. The English Courts will not probate a Will unless there are English assets - which may be just a bank account. Secondly do you mean China (PRC) or do you mean Hong Kong or both?
The basic law on real estate is that on death the law of the jurisdiction where the land is situated will govern, so the English Will might not be recognised (or rather enforced) in China. Hong Kong is different being basically English law, so the English Will will apply to assets in Hong Kong, and UK Will if probated in the UK can be resealed and then enforced in Hong Kong.
You also need to be very careful to make sure that each Will (I would have one for the PRC assets and one for the English assets) mentions the other, and does not revoke the other Will for example by including a phrase such as “I revoke all former Wills and testaments” which can cause disaster.
One way around the problem may be to create a trust of the Chinese real property and have the properties transferred to that Trust as then the issue of a Will may not arise. This depends upon whether or not the PRC recognises trusts. Certainly local PRC legal advice needs to be taken. There are several Hong Kong law firms with branches in the PRC who can be consulted…
I hope this helps.
Peter Double
Probate Resealing Services
Tel: (44) 1638 713 288
On the basis that HM Courts and Tribunal Service has jurisdiction within the UK only, I would strongly suspect that it would be unlikely to probate a will dealing only with assets outside of its jurisdiction. I am not aware of any written rule to this effect.
Is there the equivalent to the Wills Act 1963 in China? If so, might not a statement of law given by a UK notary suffice?
Paul Saunders FCIB TEP
Independent Trust Consultant
Providing support and advice to fellow professionals
If the client is domiciled within the United Kingdom i.e. in one of England and Wales, Scotland or Northern Ireland then it depends upon which of those jurisdictions has the authority to grant probate over the will.
If the Chinese estate only comprises movables, then an English Court if competent will grant probate of the will to the will’s executors. If you need you can appoint separate executors for the Chinese movable assets, or even have separate wills, provided that you take precautions against unintended revocations.
That is the limit of my competence, but if there are Chinese immovable rights involved, these would not be totally within the grant of probate or the English Court’s fundamental jurisdiction, despite Matthews HHJ’s heroic attempts to assign title to English trustees over land in ex-Yugoslavia in Vucicevic v. Aleksic[2017] EWHC 2335 (Ch). where the relevant parties were domiciled and had submitted to the English jurisdiction. Please note that a trust of land is still considered an immovable following re. Berchtold. It might not be wise to attempt to impose a trust in a will over any immovable in China.
My limited understanding is that the PRC and the regional administrations has title to immovable property, and thereby grants rights of occupation over land and immovable property. I do not know what for these adopt, whether they are equivalent or not to leasehold, short term leases or terms of years for for life or whether it is possible to leave any such interest independently of a reversion to the PRC, but I daresay that the Chinese lawyers concerned will be able to address that.
Whether such a politically reversionary interest could be treated as a movable or an immovable is generally left to the lex rei loci sitae, China, but if it is treated as a movable under Chinese land law and can be subjected to a succession in China outside the relevant owner’s purview and consent then it might be possible to include the movable interest in an immovable in the will. and so obtain English probate over it.
These hesitant propositions are subject to the doubtless wider and better informed knowledge of others on the Forum.
Peter, thanks for your good advice. I have noted those points you mentioned. I have instructed my two associates to gather information regarding foreign inheritance/succession laws. We did notice that in Australia, local courts won’t probate a will dealing only with estates outside Australia, but has not information on that under UK rules. That is why i asked here.
Unfortunately, China doesn’t have living trust or even testamentary trusts esp when it comes to real properties. No way.
I won’t brag much about my own knowledge in this regard. However my team deal with cross-border estate planing for more than a decade, I do believe I know a lot more than average.
Hi Paul, you seem to concur with Peter on the point that UK courts won’t probate a will dealing only with estates outside UK. Peter seems to indicate that it is possible only if the estates is located in anther common law jurisdiction where the UK court grant of probate can be resealed in that other jurisdiction.
We don’t have a statute only for wills. We do have a Succession Law which has now been merged into China Civil Code which will only take effect from January 1, 2021.
A statement of law from UK notary could work, but most likely that China notary officers won’t accept it. In practice, they may only feel comfortable to see the will duly probated in UK. Though in my personal opinion, grant of probate doesn’t necessarily and conclusively mean the will is valid, since it can still be challenged after the issuance of grant of probate. Correct me if i am wrong on this.
Thank you Peter Harris. Well, you have stretched the topic further to cover property rights, which is a wild area of law if one is not really versed in both jurisdictions. I won’t address those property rights issues here, there will be too much to say.
Interesting to note that you were saying the UK competent will issue grant of probate to movable estates covered by a will dealing only with such movables, a departure from the Peter and Paul. I thought it should have been well established in UK law regarding such an issue, since UK citizens are more likely to have overseas assets.
So far, the consensus is that UK courts won’t probate a will dealing only with foreign real estates.
A separate note to all interested: China (excluding HK for purpose of this post) does not usually enforce foreign court judgments (arbitral awards are different), so it will be unwise for a UK court to assign title of China properties to foreign trustees. At the end of day, a separate court action shall have to be initiated in China to deal with the substantive issues adjudicated by the UK court already.
However I do notice that a recent landmark case (Akers V Samba) in UK affirming that UK court can exercise in personam jurisdiction over trustees who hold title in assets in civil law jurisdictions. That may partially solve the trust issue in China (namely, China doesn’t recognize family trusts over real properties) by appointing a proper trustees (legal heirs) under a UK trust (governed by UK or other offshore trust laws) to take up title of real properties in China, and then the trustee sells the properties, and get the sale proceeds repatriated out of China and settle the same on the said UK trust. I believe this may work in some cases according to the law expressed in Akers V Samba case.
You did refer to “China real properties” in your post.
The point is that the English Court needs to have trustees or persons within its jurisdiction or their submission to its jurisdiction in order to impose and then enforce the duties of trusteeship, that is the only way through the UK Court’s inability if not refusal to deal with foreign realty.
Akers v. Samba involved a Cayman Island trust and movable assets. The reason why the Supreme Court took “jurisdiction” was that it was in UK, not Cayman, Bankruptcy proceedings revolving on the nature of the asserted equitable interest over Shari’ah assets. They did not take full jurisdiction over the trust itself.
You might find the postings on a different case, Vucicevic v Aleksic , 2020 EWHC 2236 Ch, involving the Serbian Orthodox Church of interest here as it shows the issues which both the English Court and the receiving Montenegrin notary were faced in dealing with the realty there had to address in imposing and English will over foreign land even with both the proposed trustees and all other parties within and happily submitted to the English jurisdiction: https://www.bailii.org/ew/cases/EWHC/Ch/2020/2236.html
The main issue is that England is a scissionnist jurisdiction in Private International Law which tends not to assert jurisdiction as of right and particularly as to ownership or title over foreign realty.
Do you have an authoritative Chinese work on Chinese realty which is translated into English or perhaps better into French? I would be grateful for the reference as I understand that the notarial system in China is a rich one. Since Vucicevic, a great deal of attention to the details involved will be needed to persuade an English Court to give an order asserting a trust over foreign land where trustees are not recognised as capable of holding title to land in that specific capacity.
I did not, I think, say and certainly did not mean that that at all. Reesealing is a common law matter but there is nothing stopping a Chinese notary effectively acting upon an English/Welsh sealed will if he chooses to under Chinese law. My apologies if I was not clear enough. There is a difference between a foreign movable estate and a foreign immovable estate.
The English/Welsh Probate court will give a grant over movables everywhere where the deceased is domiciled in E&W. Different rules apply where the deceased is not domiciled in England. However that grant does not extend to foreign, i.e. Chinese immovables outside E&W unless there are also English immovables governed by the same Will.
In this case, I still think that it would be unwise to put the Chinese immovables into an English will trust of any sort, for the reasons emanating from the Serbian Orthodox Church case.
The question may be whether the Chinese Courts will be as magnanimous and supportive to an English will including a trust disposition over Chinese realty.
Thanks for your e-mail. We will certainly bear you in mind if and when we have any matters dealing with the PRC.
On the other hand, we will be please to help you in regard to other jurisdictions as we practise all over the World, and will be happy to work with you. I expect most of your clients deal with Australia; USA; Canada and the UK and we are familiar with the resealing aspects in those countries.
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Dear Peter, apologize, I should have replied to your comments earlier. The case you referred to is interesting and it could happen when a China property is involved in the English court decisions. Right, as the court has rightly pointed out, the two systems have different approach on dealing with estate and inheritance. On the other hand, i did believe the foreign court (in that case Montenegro) should respect the English court decision to transfer the title of the property to the trustee, and i think they did that but due to the lack of details about the property, they cannot finally transfer the title according to English court decisions.
Peter, thanks again for your comments. Interesting observation.
I agree that China notary offices should feel comfortable with sealed will (probated) provided that there is no challenge to the will. But so far as i understand, when a will is probated (meaning a grant is issued to the executor), this doesn’t conclusively mean that the will is valid and enforceable in full. Here i am concerned with challenge to a probated will. My research indicated that in both UK and HK, it is possible to challenge a will after a grant of probate is issued. If the challenge is successful, well it means the will probated may be put aside or otherwise comprised.
Corrects me on this point if i am wrong.
Right, you see, my point of arguing for writing a will cover both Chinese and UK assets makes sense. Based on your words, if the will covers properties in both countries, the UK court will have to probate the will, but if the will deals with China real properties only, the UK courts won’t probate the will.
China does have trust law, but still inter vivos trust and testamentary trusts are both rare and there are too many uncertainties surrounding them in the practice. While the Shanghai court recognized that trust (which was done with wild interpretation of the court of the wording in that will), it does not mean it is advisable to set up a family trust designating natural persons as trustees. China trust companies are shifting their focus on family trusts that may eventually bring china family trust businesses to a new level provided that pertinent laws will be put into place, esp tax laws.
China courts recognition of foreign family trusts may not be an issue. We did have a precedent case involving China courts seemingly recognized a testamentary trust set up in a will made in Hong Kong. Also, there is a lot of confusion and uncertainty in this area. My understanding based on the Akers v Samba case, a foreign trustee is capable to obtaining title in China (despite that there is trust registration over the trustee title) since the foreign courts (e.g. UK court) may still enforce the trust against the trustee over the trust properties in China.
Thanks Peter Double, I am more than happy to cooperate with you on any cross-border estate planning and inheritance matters. I have worked extensively with many lawyers from all over the world.
