Israeli probate proceedings
Joseph Tamir and Shira Shine-Fried
Israel provides a second home for many people who have chosen to live outside its borders. A fair number of these maintain active connections with Israel and even hold property in the country, notwithstanding that the center of their lives is abroad. Further, the pace of economic development is attracting considerable foreign investments.
These features make it necessary to address the situation of a property owner who dies domiciled outside of Israel and leaves property in Israel. The process for realizing the deceased’s estate in such circumstances must take into account Israeli succession law, as well as the rules of private international law as applicable in Israel.
This process can be complex and cumbersome. It is therefore preferable to draw up a regulated will in good time, so as to facilitate the realization of the estate’s assets in the future, as well as the taking of appropriate steps and procedures following death. This article considers the principal provisions of Israel’s Succession Law – 1965 (“the Succession Law”) that deal with the estate of a deceased whose domicile was overseas, as well as the procedures for obtaining a probate or succession order in such circumstances. The article also considers the options open to a non-resident wishing to control the devolution of his assets situate in Israel.
International jurisdiction of Israeli courts
Where a deceased lived outside Israel and left property in Israel, the initial question of jurisdiction is addressed in Section 13 of the Succession Law, pursuant to which the Israeli courts are competent to deal with the inheritance of any person who is domiciled at the date of death in Israel or who left property in Israel.
Domicile is not always easily determined, particularly in the modern experience, where it is not uncommon for people to divide their lives among a number of countries. It is indeed the general rule that the majority of the factual components connecting a person to a particular country (subject to the existence and provisions of tax treaties) such as place of residence, place of employment/business, place of residence of surviving family members and the like must be examined. The first alternative, provided in the Succession Law, relates to the question of whether a deceased has left property in Israel. The existence of such property will confer on the Israeli courts international jurisdiction for the purpose of considering the deceased’s estate.
Substantive jurisdiction of the Israeli courts
Ordinarily, applications for probate or succession orders are lodged with the Registrar of Legacies. However, where the domicile of the deceased was outside Israel, substantive jurisdiction rests with the Family Court.
Where all the heirs agree, there is a concurrent jurisdiction to consider applications for a succession or probate order before the religious courts.
Choice of law
That an Israeli court has jurisdiction to consider the estate of a non-domiciled deceased person does not mean that the proper law that will be applied by the Israeli court will be the Israeli law. In order to determine the proper law applying to the estate, one must examine the proper law provisions under the Succession Law.
Section 137 of the Succession Law states that the law of the deceased’s domicile at the date of his death applies to his estate. This rule has an exception, and that is with respect to assets passing by way of inheritance solely pursuant to the lex situs of such assets. One could therefore have a situation where the Israeli courts will apply foreign law to a deceased’s estate.
If the law of the jurisdiction in which the property is situate does not oblige the application of that law over the estate, the law of domicile of the deceased will apply to the entire inheritance of such property. With regards to immovable property situate in Israel, Israeli law will in most situations apply.
However, such contingencies bring with them a certain complexity in that the Israeli courts are not necessarily familiar with the law of any given foreign jurisdiction. Foreign law is deemed to be a matter of fact and must therefore be proved by educing evidence in court. Accordingly, foreign law is to be evidenced by means of an expert who is well versed in the particular foreign law, and whose opinion must be attached to the application for the succession or probate order.
Proceedings for the realization of legacies
In order to transfer an asset registered in the name of a deceased to his lawful heirs, an application for a succession or probate order must be lodged in Israel. This application must be accompanied by certain original documents, such as a death certificate and the original will, together with certified legal translations.
It is important to note that, notwithstanding Israel’s being a signatory to the Enforcement of Foreign Judgments Treaty, Supreme Court precedents suggest that a succession or probate order granted outside Israel cannot be enforced. There is no “re-sealing” facility, as in some other jurisdictions, and one cannot apply to have a foreign succession or probate order recognized in Israel, as such documents have no extraterritorial validity.
Lastly, with a view to avoiding a plethora of complications in proving a foreign will, including the inclusion of foreign trust provisions that are often awkward in their application in Israel, it is recommended to have two or more wills drafted; one or more dealing with foreign assets in various non-Israeli jurisdictions, and the other dealing with Israeli assets, where Israeli law will be applied. In this manner, only the Israeli will needs to be filed with the Israeli court, thus avoiding the complexities of dealing in Israel with foreign assets. This is particularly helpful where the release of foreign assets is delayed, leaving the Israeli assets realizable sooner under a separate Israeli order.
Joseph Tamir, LL.B., LL.M., TEP, is a Senior Partner in the law firm of Michael Shine, Tamir & Co., where he manages the firm’s local practice. He serves as a member of its Trust Committee and served as a Member of the Board and the National Council of the Israel Bar. He has also authored and edited several books in the field of commercial law and co-authored several articles published in international law journals. .
Shira Shine-Fried, LL.B., TEP, is a Senior Partner in the law firm of Michael Shine, Tamir & Co., where she manages the firm’s international law division, focusing on multinational family asset structuring and planning, trust law and international trust administration. She has co-authored several articles published in international law journals and chairs the Trust Committee of the Tel-Aviv District Committee of the Israel Bar Association. Mrs. Shine-Fried lectures on a regular basis in various forums on trusts.