Where
There’s A Will There’s A Way – Part 1
By:
Russell D. Mayer, Adv. – March 2006 As
it says in Kohelet, there is a time for everything. Planning for the inevitable,
BE”H, therefore makes good sense. What arrangements
can be made in a Will? Does it matter if you already have a will that you executed
abroad? What happens if you don’t have a will? Who takes care of your children
when you die? Who gets your prized possessions when you die? Is it really necessary
to engage an attorney to draft your will? We will seek to address some of these
issues, in very broad terms, in these articles. General
Rules Inheritance. Israeli
inheritance laws govern the distribution of a deceased’s property located in Israel.
The law pertains to distribution of assets in the absence of a legally valid will
(“intestate”) as well as the rules applicable to preparing and executing a will. In
the absence of a legally binding will, a deceased’s spouse would receive all movable
property (including a car) owned by the deceased at the time of his or her death
and, with respect to the remaining assets: (a) if the descendent had children
then the spouse would receive half of the remainder and the children or their
descendents would receive the balance (equal shares to each of the children or
their descendants) or (b) if the descendent had no children but left a spouse
and siblings, then the spouse receives two-thirds of the remainder with the balance
divided among the siblings. Certain types of joint
ownership will automatically convey the deceased’s share in the surviving joint
owner regardless of intestate succession or provisions of a will. For example,
some bank opening statements provide that in a jointly held account, the survivor
receives all of the balance in the account. Outside of Israel, it is common for
many types of property to have this automatic trigger. In such cases, notwithstanding
the provisions of a will, the property of the deceased will pass in accordance
with the property provision. In the course of planning one’s estate it is important,
therefore, to share with your lawyer, a thorough description of all assets held
by the parties as well as the technical title so that the lawyer can advise how
to structure the estate passing under the will while taking into consideration
assets they may pass outside of it. Section 17(a)
of the Inheritance Law provides that where an heir cannot otherwise be identified
pursuant to the Law, the State of Israel shall inherit the estate. Guardianship.
Israel’s guardianship law will determine who will be appointed as guardian of
minor children or incapacitated individuals. The Guardian General will often
take the totality of circumstances into consideration in determining who is best
suited to be appointed guardian but in the absence of a surviving parent will
give preference to immediate relatives (e.g. parents’ siblings, parents’ parents,
aunts and uncles). If a parent provides in a will for the appointment of a specific
guardian, the Guardian General and the courts will generally respect that provision
subject to overriding concerns as reflected in the law. It is, therefore, highly
recommended that one provide for appointment of guardianship of minors in a will
and that the appointment be made within the parameters of the law. Israeli
Inheritance Tax. Israel had an inheritance tax until several years ago.
From time to time the tax authorities suggest that they are considering reintroducing
the tax. Until such time as the tax is re-implemented, tax considerations which
may have been considered in developing a will abroad, may not be applicable regarding
Israeli assets (although they may still be subject to foreign inheritance taxes)
and, therefore, design of inheritance schemes may have more flexibility than did
their foreign counterparts. Probate.
A will generally needs to be processed (e.g. probated) in every jurisdiction in
which assets are located (e.g. if there is one will and assets in both Israel
and the U.S., probate will need to be done in both countries). Trusts.
Particularly if minors are involved, immediately or potentially, a properly executed
will, that we recommend be drafted by an experienced attorney, may very well include
the establishment of trusts that will control the use of assets which would otherwise
be directly bequeathed to minors. The above article
provides a general view on the laws governing wills and estates in the State of
Israel. As emphasized above, we strongly suggest that, upon deciding to draft
your last will and testament, you consult appropriate legal counsel in order to
guarantee that your wishes are fulfilled and avoid your family undue problems
and anguish that can arise in the event of the lack of a will or contest to an
improperly constructed will.
Learn
More
Where There’s A Will There’s A Way – Part 2
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This article is not to be considered
as a legal opinion. For legal advice, we suggest you contact legal counsel directly Russell
D. Mayer is senior partner at the Jerusalem-based law firm of Schuman,
Livnat & Mayer. If you have any comments or questions with respect
to this article, please contact Russell at mayer@slmlaw.co.il
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