March 6

Expats die too…

Whether your great-aunt leaves you a coastal villa in Marbella or your grandfather bequeaths you his fashionable Madrilenian flat, one thing is certain: the hassles have just begun. The funeral over, you must begin to unravel Spanish red tape and prepare to pay your newfound Spanish tax liabilities…

Administering Spanish and UK estates differs greatly. Who pays inheritance tax (“IT”) is an example: Spanish IT is paid by beneficiaries, whereas in the UK it’s the deceased’s estate that foots the bill. To have Grandpa’s flat registered in your name (essential if you’re ever to sell it subsequently), you must first pay Spanish IT. Rates vary throughout Spain and depend on the familial relationship that links the beneficiary to the deceased (if related). Contrast this with the UK, where IT is paid at a flat 40% rate above a sizeable non-taxed sum.

To move in to your great-aunt’s villa, in addition to Spanish IT you must also pay local value increase tax (known as plus valía) to the town hall in Marbella, as well as Land Registry and Notary’s fees. The villa itself and all her other Spanish assets of significant value must be listed in an inheritance acceptance deed, including her Spanish bank accounts, her red Ferrari and her collection of Salvador Dali lithographs.

January 8

The International Child Abduction Lottery

The Hague Convention on the Civil Aspects of International Child Abduction of 1980 (the Convention) is one of a large number of conventions signed in the Hague but it stands out as possibly the most well-known – why? Probably because it deals with the emotional and sometimes highly publicised issue of child abduction.

The Convention’s aim is to have children swiftly returned to their country of habitual residence when someone – usually a parent – takes them from, or prevents them from returning to, that country in breach of the other parent’s rights.

When the Convention was first conceived, it was expected that it would mainly prevent fathers from turning up at school gates, bundling their children into fast cars and taking them off in clouds of dust. But the last four decades have shown that the reality is very different: most abductions involve no physical violence or spiriting-away of children in the middle of the night. Instead, the typical abductor is the mother and abduction occurs when – perhaps after a stay with the children in her original home country – she can’t bear to return them to the country where they were being brought up, her relationship with the children’s father having ended.

January 8

The International Child Abduction Lottery

The Hague Convention on the Civil Aspects of International Child Abduction of 1980 (the Convention) is one of a large number of conventions signed in the Hague but it stands out as possibly the most well-known – why? Probably because it deals with the emotional and sometimes highly publicised issue of child abduction.

The Convention’s aim is to have children swiftly returned to their country of habitual residence when someone – usually a parent – takes them from, or prevents them from returning to, that country in breach of the other parent’s rights.

When the Convention was first conceived, it was expected that it would mainly prevent fathers from turning up at school gates, bundling their children into fast cars and taking them off in clouds of dust. But the last four decades have shown that the reality is very different: most abductions involve no physical violence or spiriting-away of children in the middle of the night. Instead, the typical abductor is the mother and abduction occurs when – perhaps after a stay with the children in her original home country – she can’t bear to return them to the country where they were being brought up, her relationship with the children’s father having ended.

Abductions fall into two categories, either wrongful removal or wrongful retention:

  • wrongful removal includes the situation where a parent disappears with his child and takes her to another country; whereas
  • wrongful retention occurs where both parents agree their child should be taken abroad (so the child leaves her country of habitual residence temporarily and legally) but, when that stay abroad is ended, the accompanying parent can’t bear to return her.

Ninety-eight countries are signatories to the Convention, including all EU countries, as well as the USA, Canada and Australia. But much of Africa, the Middle East (with the exceptions of Pakistan, Israel and Iraq) and China aren’t signatories: so the safety-net created by the Convention still has large holes in it.

However, signatory status does not mean the same level of application in all the countries that have signed it. Just within the EU, there are vast differences in speed and thoroughness when it comes to implementing the Convention: vigorous appliers include the UK and Germany; others (such as Poland and Spain) are less effective, failing sufficiently to centralise the hearing of Convention cases in expert courts, falling down on educating judges and lawyers in terms of the Convention and insufficiently funding the government authorities responsible for facilitating the Convention’s application within their borders. In such countries, a Convention case can end up being heard by a judge with little or no experience of the Convention, and sometimes the lawyers involved know too little about the Convention too: when that happens, it’s a case of the blind leading the blind.

A trap that inexpert courts may fall into is deciding not to return a child to her country of habitual residence because such return will put her at grave risk; however, the bar for assessing whether grave risk exists should be a high one and, indeed, the EU has taken steps to try to ensure this grave risk defence is not used to prevent children being returned from one EU state to another.

A lack of experience in Convention cases, can also result in the court considering and giving weight to welfare-based questions, such as:

  • who should the child best live with?
  • is she happy living away from her country of habitual residence?
  • was her left-behind parent paying enough towards her upkeep?

Such questions should rarely be relevant in Convention cases, and are ones that should instead be decided by the courts of the child’s country of habitual residence.

Strip such (what should be irrelevant) issues out of the equation, and a court required to consider a Convention claim has, in fact, relatively limited questions to decide:

• first, was the country from which the child was abducted her country of habitual residence? (here, looking at where the child was being schooled is important, as may be the length of time she’s spent living in different countries during her life);

• secondly, does the left-behind parent have rights which have been breached by the abduction? (generally, mothers and married fathers will have, as will fathers who’ve recognised a child as theirs); and

• thirdly, is there a valid defence which means a return of the child should not be ordered? (an older child’s strong objections to return may be relevant here, as too may be her being well settled in her new country, should the left-behind parent have waited too long before bringing a Convention claim).

© 2018 Legal Advice in Spain, S.L.

For more information about this topic, or to obtain any other legal advice concerning Spain, please email cl@domenechabogados.com

October 25

Differences in Spanish/English divorces

Clients may have a choice of where to divorce.  Here we examine some of the very different procedures and possible outcomes that may arise if a couple has the right to divorce either in Spain or in England and Wales (which from now on in this blog post we’ll refer to as ‘England’).

If one spouse perceives either of these two jurisdictions as being advantageous (London being billed as the ‘divorce capital of the world’, the levels of its punchy financial orders not being seen in Spain, and Spanish courts not making the asset redistribution orders that an English court does), there may be a race to ‘get in first’, thereby ensuring that the divorce is heard in one jurisdiction as opposed to the other.  Where time is of the essence, drafting the necessary paperwork to win that race and divorce in England is likely to be a quicker process than it will be in Spain.  In England, one can launch a divorce process and follow up with the financials later;  whereas in Spain, to start a divorce, one must do all the very careful drafting (including regarding financial claims) before filing in court, this then being a brake on filing first.

Another big difference between divorcing in Spain and England is that, in the English court, there are strict rules to stop a spouse misleading their other half – and hence the court – by lying or committing perjury.  Spouses divorcing in England who deliberately set out to hide the extent of their wealth or the location of their assets may find themselves in deep trouble, perhaps even in jail.  Contrast Spain, where there’s no perjury for spouses in a divorce process.  So you could say a Spanish judge expects the husband and wife not to be telling the truth.  It follows that where there’s a high level of doubt about the extent or location of a spouse’s assets (perhaps they’re hidden off-shore, for example), it’s more likely they’ll be rooted-out in the context of an English divorce than in a Spanish one.

It’s because of that key difference that one won’t see sworn statement (known as ‘affidavit’) evidence in the context of Spanish divorce proceedings;  a Spanish court is not so much interested in what someone says happened as how that can be proved independently:  hence a wife who says “He hit me more than once” had best back up her statement by having reported his violence to the Spanish police (otherwise, her recounting of events is unlikely to carry weight in court).

Finally, depending on which region of Spain is relevant in a divorce, ‘matrimonial regimes’ may largely dictate financial results.  Some Spanish regions (Madrid being an example) uphold a shared matrimonial regime (known as gananciales):  this means that assets acquired by one spouse after marriage will be treated upon divorce as being shared:  thus, a house which is bought as an investment after marriage in just the wife’s name will automatically be treated in a Spanish divorce regulated by this regime as being half owned by her husband.  This form of sharing pursuant to a matrimonial regime is not seen in English divorces, where the starting point will be more akin to the second form of Spanish matrimonial regime (applicable in Barcelona, for instance) under which what’s bought or earned by him after marriage is his and what’s bought or earned by her is hers (this regime being known in Spain as separación de bienes).

For more information on these of any other Spanish law issues, please contact Christopher Lee at cl@domenechabogados.com or on (00 34) 93 415 0677.

 

© 2017 Legal Advice in Spain, S.L.

Kate Wasyliw and Charlie Wilson enjoying work experience with Doménech Abogados