In French law, your children are protected heirs (héritiers réservataires), with an automatic right to a share of your estate.
The size of their entitlement depends on whether there is a surviving spouse, and the number of children.
In the recent case, an elderly widower died, leaving as his successor his son, as well as his nephew, to whom he had bequeathed that part of his estate that was freely disposable (quotité disponible).
It was established in court that the son was estranged from his father.
As there was no surviving spouse and only one son, the son was entitled to half of the estate, with the remainder left to the nephew under the will.
According to a draft declaration of succession, drawn up by the notaire, the estate assets consisted of bank balances of €38,267 and the undivided half of a boat with an estimated full value of €16,000, or €8,000 returning to the estate.
However, in court the son contested that these were the estate's only assets, and sought compensation for other assets received by his cousin during his father’s lifetime.
The first of these was an assurance vie policy taken out by the deceased in 2005, 13 years before his death, in the sum of €30,500, with his nephew designated as the beneficiary of the contract. The sum is the maximum premium that can be paid by an insured person 70+ before it is taxable on death.
The son claimed that by virtue of the age of his father (73 years) at the time, and his lifestyle and modest wealth, the amount of the policy was excessive. He considered, that as a result, he was entitled to have it reintegrated into the inheritance calculation.
But having examined his father’s income and assets at that time, the court concluded that the amount of the premium was not ‘manifestly exaggerated’.
The son also contested the sale of a house to his cousin by his father at a price below free market value. The house was sold in July 2010 for €240,000 yet had been valued in January 2010 at €340,000.
The son claimed that by selling the property at a price below its the market value made it a disguised gift which should be taken into account when calculating the inheritance.
Nevertheless, in court it was established that the sale agreement contained a clause granting the seller the right to use the property for 4 months every summer, for a period of 30 years, and evidence produced showed that he had indeed exercised (in part) that right until his death in 2018.
The court therefore dismissed the son's claim.
The son also contested a loan of €70,000 from his father to his cousin, which was used to purchase the property. The loan agreement provided that it should be reimbursed over 10 years.
The son claimed that the loan was another disguised gift which should be reintegrated into the estate.
In court, whilst it was shown that no repayments were ever made against the loan, the court concluded there was no evidence the father intended to make the loan a gift.
Nevertheless, as the debt remained outstanding it was ruled that this should be reintegrated into the estate, but that due to the 5-year statute of limitations on recovery of debts, only the amount due 5 years prior to the father's death could be included, equivalent to nearly €43,000.
Over the period 2010-2017 the deceased also issued 5 cheques to his nephew, amounting to nearly €50,000.
Once again, the son argued in court that these cheques were disguised gifts and should be reintegrated back into the estate.
However, the cousin was able to show that a large cheque for €42,000 made in 2010, was used to undertake repair, maintenance and new construction work on the property, albeit mainly through statements provided by witnesses, and only two invoices, amounting in total to just over €10,000.
Other cheques, made in 2017, were to remunerate the nephew, who had been caring for his uncle until his death in 2018.
Accordingly, the court dismissed the claim that the cheques were disguised gifts.
Related Reading:
-
[How to Transfer French Property to Children](
https://news.france-insider.com/archive/how-to-transfer-french-property-to-children)
