Debt lawsuits burdening inheritance

Jurisdiction.

The claims of the testator's creditors brought against the heirs, the executor of the will (the trustee of the inheritance), are subject to the jurisdiction of the court at the location of the inherited property in accordance with the rules established by the first part of Article 31 of the CPC (exclusive jurisdiction).

That is, in the event of a dispute regarding the estate, which includes immovable property, the claim by the creditor must be filed at the location of this property.

In other cases, creditors' claims for recovery of the testator's debts from the heirs are considered by the courts according to the general rules of claim proceedings – at the defendant's place of residence.

Definition of the legal relations of the parties and the law to be followed.

The legal relations of the parties in cases of this category arise from the application of the norms of Chapters 3, 36, 57-60 of the Civil Code, the Law "On Notaries" and are determined based on a set of data: the subject and basis of the claim, the defendant's objections to the claim, and other circumstances of legal importance for the proper resolution of the case.

The subject of the dispute is the existence and volume (size) of the testator's debts, and the procedure for collecting them.

The basis of the claim submitted to the court is the factual circumstances stated in the claim, indicating the existence of debts of the testator. At the same time, the indication by the plaintiff of a specific legal norm in support of the claim is not decisive when deciding by the judge which law should be followed in resolving the case.

Persons involved in the case. The creditors of the testator act as plaintiffs in cases of this category.

The defendants are heirs who have accepted the inheritance and have not refused to accept the inheritance within the time limit prescribed by law.

Facts to be established and proved. Evidence and proof.

The subject of the evidence includes the following facts:

- the fact of opening an inheritance;

- hereditary mass;

- the circle of heirs and their shares, including in value terms;

- the presence of debt and its size;

- other circumstances.

By virtue of the law, debts are inherited and the heirs must be responsible for the debts of the testator to his creditors, regardless of whether they received this inheritance by will or by law.

In accordance with Article 1040 of the Civil Code, the inheritance includes property belonging to the testator, as well as rights and obligations, the existence of which does not cease with his death. That is, their execution cannot be carried out without the personal participation of the debtor, or these rights (obligations) are otherwise inextricably linked to the personality of the debtor.

For example, heirs do not have to pay alimony for a deceased relative. The heirs are also not responsible for the damage caused by the testator to the life or health of third parties.

Otherwise, inheritance is carried out according to the rules of universal succession: the heirs assume obligations in the form in which the obligations were at the date of death.

So, the heirs are responsible for the debts of the testator, which include debts on loans, loans, contracts for the purchase of any property, and others. At the same time, debts include the amounts of the principal debt, as well as interest, penalties, and fines accrued on the date of the testator's death.

Since a loan obligation is not considered to be inextricably linked to a person, it cannot terminate due to the death of the debtor.

In accordance with Article 1081 of the Civil Code, creditors of the testator have the right to present their claims arising from the obligations of the testator to the executor of the will (the trustee of the inheritance) or to the heirs responsible as joint debtors within the value of the property transferred to each of the heirs.

Thus, the heirs are responsible within the limits of the value of the share received in the inheritance. In this case, the heir is responsible for the debts of the testator only if he has accepted the inheritance.

In the judicial process, it is extremely important to correctly correlate the value of the received inheritance and the transferred debt. Heirs should not give away more than they have received.

At the same time, in the decision on debt collection, the court cannot oblige the heirs to repay the debt at the expense of the apartment, but only collects the appropriate amount.

If the debt was secured by collateral (car loan or mortgage), then the heir receives not only the debt, but also the collateral. Accordingly, in this case, repayment of the loan to the bank is not difficult, since with the consent of the mortgagee, the collateral can be sold and thus the debt can be paid off. In such a situation, the creditor has the priority right to repay the debt at the expense of collateral.

Responsibility for debts between heirs should also be distributed.

If there are several heirs who have accepted the inheritance, then they are jointly responsible for the debts of the testator. This means that the creditor will be able, at his discretion, to file a claim against all the heirs or one (several) of them at once, for the entire amount of the debt or for some part of it. The creditor has the right to demand the fulfillment of obligations both from all heirs jointly and from any of them individually – within the limits of the value of the property transferred to each of them.

For example, if the property consists of shares in the ownership of an apartment, then in the same shares the heirs are obliged to repay the loan provided for the purchase of this apartment.

The law also provides for the renunciation of inheritance, for which the heir must contact the notary office at the place of opening the inheritance and write an appropriate application within the time limit prescribed by law.

If the debt is commensurate with the inheritance received, then the heir, based on expediency, may renounce the inheritance in order not to incur the costs associated with the proceedings in court and repayment of the testator's debt. But such a refusal is possible only within six months after the discovery of the inheritance (death of the testator). Therefore, if the creditor sued the heir who accepted the inheritance after the expiration of the specified period, then it will no longer be possible to refuse the inheritance and the testator's debts will have to be paid.

In accordance with paragraph 8 of Article 1074 of the Civil Code, renunciation of inheritance with reservations or under conditions is not allowed. If the heir renounces part of the inheritance, it is considered that he has renounced the entire inheritance.

It will be possible not to pay the loan to the heir even if the creditor does not present his demands for repayment of the debt.

Sometimes a will is made in favor of minors, such as children or grandchildren, or minors become legal heirs. They also inherit the debts of the deceased testator along with the property. Inheritance on behalf of a minor is accepted by his legal representatives: parents, guardians, trustees. For children under the age of 14, an application for inheritance acceptance is submitted by legal representatives. If the heir is 14-18 years old, then he acts when applying for inheritance himself, but with the consent of his parents, guardians or trustees. Repayment of the testator's debt in this case is carried out by the legal representatives of minors.

It should be noted that a minor heir can renounce the inheritance only with the official permission of the guardianship authorities.

If the inherited debt was issued under the guarantee of third parties, then the situation seems more complicated. It is of great importance how conscientious the deceased borrower was. If he paid his obligations accurately and on time, then in the event of his death this debt passes to the legitimate heirs, and the likelihood that the creditor will try to satisfy his claims by contacting the guarantors is not so high. But if the borrower did not pay, and at the time of death there was already a court decision on the recovery of overdue debts, including from the guarantor, then the guarantor will have to answer for this debt.

However, even in this case, the guarantor may, having fulfilled the obligations of the deceased borrower, apply for recourse to the legitimate heirs and return his money through the court.

Individual issues related to the consideration of cases arising from hereditary legal relations

Restoring the deadline for accepting the inheritance

Claims for the restoration of the time limit for accepting inheritance are considered in the order of claim proceedings, which is regulated by paragraph 12 of the normative resolution of the Supreme Court "On certain issues of the application of inheritance legislation by Courts" (hereinafter referred to as the normative resolution).

Cases concerning the extension of the period for refusal to accept inheritance are considered in a similar manner.

The jurisdiction of cases in this category is determined by part three of Article 31 of the CPC (exclusive jurisdiction) – at the place of inheritance discovery.

The defendants in cases of this category may be other heirs who have accepted the inheritance. In the absence of such heirs, the body authorized to manage communal property at the place of inheritance opening is involved in the case, since acceptance of inheritance is not required for the acquisition of extortionate property.

The above allows us to conclude that the courts have the right to approve mediation agreements in such cases. In all cases, regardless of the defendant's recognition of the plaintiff's claims in terms of time, the achievement of agreed conditions, the court is obliged to verify the validity of the reasons for missing the deadline for accepting the inheritance or for rejecting the inheritance, whether the mediation agreement complies with the law and whether it violates the rights of third parties (Article 180 of the CPC).

When considering cases in a special procedure (establishing the fact of acceptance of an inheritance, the place of opening an inheritance, etc.), the approval of mediation agreements is unacceptable, since the defendant's participation in such cases is not provided for. The interested persons involved in the consideration of cases of this category by the applicant or the court are not by status the opposing party challenging the statement on the establishment of a legal fact. Such persons may be citizens and legal entities whose rights and interests may be affected as a result of satisfying the applicant's request.

Establishment of the place of inheritance opening

When considering applications for the establishment of a place of inheritance, the provisions of paragraph 3 of the regulatory decree should be borne in mind that, in accordance with Article 16 of the Civil Code, the locality where the citizen permanently or predominantly resides is recognized as the place of residence.

According to paragraph 2 of Article 51 of the Law "On Population Migration", registration of citizens is carried out at the place of residence and at the place of temporary stay (residence).

In accordance with subparagraph 17-1) of Article 1 of the Law "On Migration of the Population", a place of temporary stay (residence) is a building, room, or dwelling with an address that is not a place of residence and in which a person resides (resides) temporarily.

As a rule, the testator's last place of residence coincides with the place of permanent residence.

Disabled persons

Paragraph 15 of the regulatory resolution stipulates that, in relation to Articles 1068 and 1069 of the Civil Code, persons who have not reached the age of eighteen should be considered as disabled persons; persons who have reached the retirement age established by pension legislation; persons with disabilities of groups 1, 2, 3; persons who have reached the age of eighteen and older, studying in educational institutions for full-time education until graduation, but not older than twenty-three years.

It should be borne in mind that the concepts of "disabled persons" and "disabled dependents" are not identical.

The recognition of dependents as heirs by law can be explained by their disability and obtaining a livelihood from the testator, whose death deprives them of the financial assistance they receive from him. It is also important that disabled dependents are often related to the testator by kinship or property, but do not belong to the line of heirs that is called upon to inherit by law.

Paragraph 15 of the regulatory decree stipulates that the testator's disabled dependents have the right to receive a share in the opened inheritance if they were unable to work at the time of the opening of the inheritance and were dependent on him for at least a year before the death of the testator.

Since the current civil legislation does not establish a procedure for determining the disability of a dependent, the norms of social security law apply in this case.

A citizen is recognized as disabled by age or disability, regardless of whether he applied for a pension and whether it was assigned to him on the day of the opening of the inheritance, as well as whether he is engaged in labor or other income-generating activities.

The existence of a source of livelihood for an incapacitated person is taken into account when establishing the fact of dependency, which is another necessary condition for the vocation to inherit according to the law as an incapacitated dependent of the testator.

The list of the main documents attached to the statement of claim

In accordance with the requirements of Article 149 of the CPC, including documents confirming the circumstances on which the plaintiff bases his claims.:

- death certificate of the testator;

- documents on the ownership of inherited property to the testator (title documents for immovable property, certificate of registration of vehicles; certificates of registration authorities; certificates of pension savings and bank deposits, etc.);

- inventory of inherited property and reports (certificates) on its valuation;

- documents confirming the testator's debts (promissory notes, loan agreements, court decisions and other evidence)

Laws to be applied in the consideration and resolution of cases

Civil Code (Chapters 3, 36, 57-60).

Laws:

- dated July 14, 1997 "About the notary".

- dated August 31, 1995 "On Banks and banking activities in the Republic of Kazakhstan";

- dated July 22, 2011 No. 477-IV "On Population Migration".

Regulatory rulings of the Supreme Court:

- No. 5 dated June 29, 2009 "On some issues of application of Inheritance Legislation by Courts";

- dated November 25, 2016 No. 7 "On judicial practice of consideration of civil cases on disputes arising from Bank Loan Agreements".

Order of the Minister of Justice dated January 31, 2012 No. 31 "On Approval of the Rules for performing Notarial Acts by Notaries"

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