ADMINISTRATION OF DECEDENT’S ESTATE ACCORDING TO CZECH LAW
Death of a close person is a very complex matter. It is associated with big emotions while there is simultaneously a lot of legal matters that must be taken care of. Frequently, some parts of the estate require maintenance and quick decisions arising of their nature – flat needs to be rented, running enterprise operated, debts paid, and receivables enforced.
Generally speaking, the heirs are responsible for this interim management. But that is often impractical. For example, if you live in a foreign county and one of your relatives, who lived in the Czech Republic, died, you usually do not have the capacity to take care of the estate during the inheritance proceedings. Also, if there is more than one heir, the heirs can disagree on some operational matters concerning the estate. Therefore, it is useful to use one of the following two possibilities to facilitate the transition of the property.
While the common law systems usually appoint Executors and Trustees to handle these matters, the Czech Civil Code provides for different figures to play role in the administration of the estate from the death of the decedent (the person deceased) until the final decision on the inheritance – the Administrator of Decedent’s Estate (“Administrator”) and Executor of Testament (“Executor”).
Appointment of the Administrator is a guarantee that there will be no situation where no one acts for the decedent’s estate. The Administrator’s main role is to manage the property of the decedent in course of the inheritance procedure. He even has a competence to dispose with the property. This competence serves as a prevention against decrease of estate value.
The Executor is primarily responsible for fulfilling the last will. The testator has a power to determine inheritance conditions. If the testator does so, the Executor supervises the fulfilment of these conditions. In addition to this important function, he also acts as an Administrator, unless there is no other person appointed. It might happen that the testator appoints both the Executor and the Administrator. In that case there is a certain hierarchy – the Administrator must respect Executor’s orders, unless the court decides another way.
The Administrator can be named by the court but also by the testator, however, a nomination by the testator must be carried out by using a public document, i. e. the notarial deed. Administrator’s role ends when the inheritance proceeding is finalized. The Executor is specified in the testament by the testator. Subsequently, the nominated Executor is summoned by the court. The nominated person can refuse to be an Executor and then his function shall cease by the moment of delivering his resignation to the court. Position of the Executor continues even if the proceeding is finalized because he has to supervise compliance with the inheritance conditions. Obligations and remuneration of these two position holders can be specified by the testator in the testament. Nevertheless, both the Executor and the Administrator have to take care of decedent’s property while exercising due managerial care by default.
If the testator does not specify any of these two positions, an heir, optionally heirs, must take care of all inheritance proceedings themselves and agree of the solution among themselves. The reason why you should consider appointment of at least one of them when executing your last will, is that the Administrator represents a sort of service for heirs, he is a guardian of the estate. Appointing the Executor will additionally guarantee that there will be someone who will oversee the fulfilment of your last will and inheritance conditions.
For more information please feel free to contact:
Michal Dobiáš, attorney at law
rutland & partners, law firm
tel: +420 226 226 026
michal.dobias@rutlands.cz
