This article is co-authored by Marisol Cordero-Goodman
The validity of an international will has been the subject of much discussion and debate among Estate Planning Practitioners. So much so that practitioners at several international conventions have discussed under what circumstances an international will is valid and which countries laws should govern the disposal of a decedents assets when the decedent is not a citizen, a national or a domiciliary of the country where the assets are located. For the purpose of this discussion, the following is a brief synopsis of the basic rules for (1) the validity of an international will for disposing of a decedent’s assets located within Oregon and (2) the validity of an international will executed within Oregon for disposing a decedent’s assets located in another country. Even with a valid international will, proper estate planning requires an understanding of the tax laws, succession laws, and choice of law.
I. International Wills Accepted in Oregon
In Oregon, a will is valid as an international will regardless of the place where it is executed, the location of the assets, and the nationality, domicile or residence of the testator, if the will complies with the following requirements: (1) the will is in writing (in any language); (2) the testator signs or acknowledges the will and declares in the presence of two witnesses and an authorized person (defined below) that the document is the testator’s and the testator knows its contents; (3) the testator signs each page and each page is numbered; (4) the signatures are at the end of the document; and (5) the witnesses and authorized person sign the will in the presence of the testator. Oregon Revised Statute (“ORS”) §112.232.
The formal validity of an international will can be proven by a certificate, which basically states that the requirements for the valid execution of an international will have been fulfilled. The responsibility of preparing the certificate falls to the authorized person. An authorized person is either an individual admitted to the practice of law before the courts in the State of Oregon or a member of the diplomatic and consular service of the United States designated by foreign services regulations. ORS §112.232(1),(9). The authorized person is also responsible for asking the testator whether the testator wishes to make a declaration concerning the safekeeping of the will and to make a note of the location in the certificate. Id. An example of the certificate form can be found at ORS §112.232(5). Please note, the absence or irregularity of the certificate does not affect the formal validity of the will. The purpose of the certificate is to prove the will’s formal validity, absent evidence to the contrary. ORS §112.232(6).
When an international will complies with the formalities above, it will be valid for the purpose of disposing a decedent’s assets located in Oregon. There is, however, an exception to the requirements stated above. Lack of the testator’s signature does not void the will, if the testator indicates the reason for the inability to sign and the reason is noted on the will by the authorized person. The testator can also direct another individual to sign on behalf of the testator. ORS §112.232(2)(d).
An international will that fails to meet the requirements outlined above (absent an exception) is invalid as an international will. Despite this, a foreign will may nevertheless still be valid in Oregon as a general will as defined under ORS §112.235, (if it meets the applicable requirements therein) even if the will is invalid as an international will under ORS §112.232.
II. International Wills Executed within Oregon and Accepted in Foreign Countries
A will drafted in Oregon under ORS §112.232, as discussed above, is valid in a foreign jurisdiction if (1) the foreign jurisdiction has adopted the 1973 Washington Convention; (2) the form of the Oregon will complies with the foreign jurisdiction’s internal laws; or (3) it may be valid, although not necessarily, if the foreign jurisdiction has adopted either the 1961 Hague Convention and/or the 1988 Hague Convention.
As previously mentioned, international wills have been the subject of much discussion and debate among Estate Planning Practitioners. The lack of uniformity among countries with respect to the rules determining the formalities of a will, choice of law, and succession of law has led to the convening of the following three international conventions.
The 1961 Hague Convention essentially provided that a will was valid if the will was valid in the jurisdiction where: (1) the will was executed, (2) the testator was a national at his death, (3) the testator was domiciled when he executed the will, or (4) the testator was domiciled at the time of his death.
The 1973 Washington Convention focused on the structure and form of a will and basically provided that a will was valid regardless of the place of execution, the situs of the testator’s assets, or the testator’s nationality, domicile, or residence, so long as the will conforms to a proscribed uniform format as described in section one above.
Lastly, the 1988 Hague Convention provided that a testator had the power to designate the governing law (choose between law of nationality and law of habitual residence) that applies to a will. If none stated, then the default rule was the law of habitual residence.
The conventions sought to provide uniformity in the rules that determine the formalities of a will, choice of law and succession of law. Despite this, many foreign jurisdictions have not yet enacted the rules formulated by the conventions, or if they have enacted the rules, the jurisdictions have modified them. The most common modification is when a will attempts to dispose of assets that are categorized as “immovables” (e.g. real property). For example, if a will disposes of an immovable, then many jurisdictions require that the will comply with the laws of the place were the “immovable” (e.g. real property) is located regardless of testator’s nationality, domicile, or habitual residence at the time of the will’s execution or at the time of the testator’s death. The same will, however, can dispose of a “movable” (e.g. personal property) by either complying with the laws where the movable is located or the laws of the testator’s nationality, domicile, or habitual residence at the time of the will’s execution or at the time of the testator’s death.
Another common modification is Forced Heirship and/or Law of Succession rule. While many countries in Western Europe, Japan and South Africa have all signed and/or adopted the 1961 Hague Convention and/or the 1973 Washington Convention, some countries (e.g. France, Switzerland, etc.) have the Forced Heirship laws and/or Law of Succession that limit the fraction of an estate that can be disposed of by will. For example, Forced Heirship laws require that a fraction of the estate be given to certain ascertained heirs and those heirs cannot be disinherited.
To ensure that a testator’s intent regarding the disposition of a foreign asset is accomplished, the international will should comply with the rules of the jurisdiction. Practitioners may use either a single multi-jurisdictional will or separate situs wills to accomplish this.
Separate situs wills are prepared under the laws of each of jurisdiction where the testator’s property is maintained. The question of whether to draft separate situs wills or a single will is a fact-specific inquiry and dependent on the needs of your client and the skills of the practitioner. Separate situs wills are often favored since it allows more flexibility as to choice of law and can address Forced Heirship laws in those countries that have them. The disadvantage of separate situs wills is the inadvertent revocation of other separate situs wills. This can be avoided with careful planning and drafting.
To safeguard that the testator’s disposition of property is recognized by a foreign jurisdiction, it is generally recommended that separate situs wills be used and written and executed in accordance with local laws when it is known that the decedent owns real property in a specific foreign jurisdiction. Local counsel should be consulted to ensure that the required formalities of execution are observed and potential issues of local law are addressed.
Despite the conventions noted above, there is no universal rule for an international will. It is, therefore, always important to check the rules for a given jurisdiction where the assets are located to determine whether the international will can dispose of the assets, and if so, under what type of restrictions.
As illustrated above, the requirements for drafting a valid international will to dispose of a decedent’s assets located outside of the United States are complex and require more discussion than allotted for the purpose of this blog.