Commercial & Civil

The Inheritance and Successions in Chihuahua, Mexico

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Ciudad Juárez, as a border city with the US, lives in a different environment compared to other Mexico’s cities. One important aspect of its location is how its population forms their families since they live near its sister cities, like El Paso, Texas, and Las Cruces, New Mexico. For this reason, in Juárez it is quite common to get married to people from the US and beget American children. Moreover, to acquire cheaper real estate in Mexico and do business there while living in the US.

These dynamics bring advantages while the couple is still alive. However, children from those marriages generally don’t have the same attachments as one of their parents had with Mexico. Therefore, once that parent dies, they don’t know what to do with the property acquired in Mexico, such as whether they can inherit or sell it.

For this problem, in this new blog entry, I will provide a quick guide on how you can inherit, convey, or sell that property in Chihuahua State through a civil court with two different legal venues: intestate and probate estate processes regulated primarily on the Civil Code of Chihuahua and Chihuahua’s Code of Civil Procedures. Without further ado, let’s take a look.

In general, intestate and probate estate processes have four stages with few differences and similar rules for submitting certain motions and acts. But I will address those variations in their own chapters. The shared stages are known as:

1. Determination of heirship and appointment of definitive Executor of the Estate.

2. Inventory and appraisal of the decedent’s Estate.

3. General account and accountability.

4. Allocation of the assets.

As for the common rules, they are the following:

Both processes begin with the same legal provision, which consists of filing a motion under Chihuahua’s State Civil Court denouncing the decedent’s death and attaching the documents or proof that proves the kinship with the decedent and, of course, his death.

If one of the petitioners is aware of the existence of the decedent’s will, he must inform the court of it and attach it to the legal motion. In that way, the court shall admit the case under probate estate’s rules. Otherwise, the case will start under the rules of intestate processes.

If the decedent’s Estate comes from a foreign person, Chihuahua’s State Civil Court must order a service of summons to his consular authorities pursuant to the international treaties signed by Mexico.

Through its public prosecutors, the local Attorney General’s Agency will represent absent heirs if they do not appear or prove a person is representing them in the case. Likewise, to girls, boys, teenagers, and generally, people with mental or intellectual disabilities who do not have legal representatives until the appropriate person is appointed.

According to Mexico’s tax system, Estates are not excluded from paying local and federal taxes such as property taxes, income tax, value-added tax, and more. Yet, federal taxes are more common, and with them, the Executor of the Estate must be more careful.

I affirm this because article 26, section XVIII of Mexico’s Federal Tax Code regulates a joint liability in tax matters for Executors of the Estate, stating they shall be responsible for solidarity regarding those contributions that were caused or had to be paid during the period of their assignment. Therefore, they could become personally liable for tax credits if they don’t comply with our tax system.

In such manner, after the following month of accepting the charge of the Executor of the Estate, he must give notice of the commencement of the Estate process to the Tax Administration Service (Servicio de Administración Tribuataria [SAT] in Spanish), filling the form 80/CFF which shall be submitted in the SAT’s offices, pursuant article 27 of the Federal Tax Code; articles 29, 30, and 31 of the Regulations of the Federal Tax Code and Rule 2.513 of the Tax Miscellaneous Rules.

This form intends to inform the Tax Administration Service of the decent’s death to change the status of his assets, have more control of its taxation, and update its joint liability with his Executor of the Estate.

The documents that must be attached to this form are:

1.- The death certificate issued by the Civil Registry of Chihuahua.

2.- Document that certifies who is the Executor of the Estate and his acceptance of the position.

3.- Official identification.

4.- The Power of Attorney, if the Executor of the Estate is represented through it.

A final caveat for the last point: according to the Tax Administration Service’s general rules, those foreigners who are represented through a Power of Attorney must include an express clause in the contract to represent that foreigner for tax purposes.

Finally, once the estate process accomplishes its purpose and allocates the decedent’s assets, the Executor of the Estate in agreement with form 84/CFF of the Tax Administration Service, must update the decedent’s status as a taxpayer and make notice of the conveyance of its assets. This is under articles 27 and 37 of the Federal Tax Code, 29 and 30 of Regulation of the Federal Tax Code, and Rule 2.5.13 of the Tax Miscellaneous Rules.

To carry out the above-mentioned, the Executor of the Estate must fill out the form and comply with these requirements:

1.- Fill out the form for liquidation, merger, spin-off, and cancellation notices to the Federal Registry of Taxpayers.

2.- Attach a notarial document that certifies the settlement of the decedent’s Estate (certified copy and simple copy)

3.- Attach the identification of the Executor of the Estate or its legal representative.

Once petitioners report the decedent’s death while filing the case, Chihuahua’s State Civil Court must issue an official letter to the Public Registry of Property and the Notarial Office of the State of Chihuahua. This letter aimed to probe if the decedent has a registered will.

If the officials of the Public Registry of Property and Notarial Office of the State of Chihuahua find a will, they must inform the court of the case and attach it to their answer. Then, the court shall conduct the case under the probate rules’ process and must summon the estate’s heirs, legatees, and Executor or Executors of the Estate who appear in that will.

It doesn’t matter if the case started from the beginning as a probate process and petitioners attached a will in their initial motion. If it’s found another will, the court must weigh which one is more recent or covers assets not mentioned in oldest wills. After that, the court shall decide which one shall guide the decedent’s intention for his assets.

Naturally, if there is no will registered in the Public Registry of Property and Notarial Office of the State of Chihuahua, the case shall be conducted under the intestate’s rules.

Sometimes, it could be difficult for the Executor of the Estate to navigate through the inheritance process in Mexico. For this reason, Chihuahua’s legislators regulated a special legal provision that allows attorneys, for example, to represent the Estate without being the Executor of the Estate.

In article 1589 of the Civil Code of the State of Chihuahua, the State Congress allowed the Executors of the Estate to appoint legal representatives to assist them with their duties, with a Power of Attorney held before a notary public.

If after ten business days, there is no knowledge of the

designation of an Executor of the Estate, the court, previous request of the interested party, will appoint one provisional Executor of the Estate who must meet the following requirements:

I. Have the legal age in Mexico (18+)

II. With conspicuous good behavior

III. Must have his legal domicile in Chihuahua

IV. Provide a guarantee to respond for its handling within ten days counted from the acceptance of the charge, under penalty of removal.

This requirement can be excluded or waived if there is only one petitioner (and therefore future heir) or if all petitioners waive from complying with this legal obligation.

The following three business days reckoned after its designation, the provisional or definitive Executor of the Estate shall state whether he accepts the charge. If he does it, the administration of the decedent’s assets will come into force.

On the other hand, if he didn’t waive his duty of guaranteeing his charge, the Civil Court shall admonish him to do so according to article 1600 of Chihuahua’s Civil Code, which states:

article 1600.- The Executor of the Estate is also obliged, within thirty days from the moment he accepts his charge, to guarantee its management, with a deposit, bond, mortgage, or pledge, at his election in accordance to the following bases:

I. If the value of the assets that compose the inheritance has been determined, for ten percent of that.

II. If the provision of the previous article cannot be applied, it will be determined as follows:

A) For the income produced from the decedent’s real estate calculated over the last year of his decease and for the revenues made by the capital imposed during that same time.

B) For the value of the decedent’s personal property.

C) For the amount of products from rural properties calculated over a year by experts, or for the middle term of five years, at the election of the court.

D) In commercial and industrial enterprises, twenty percent of the amount of the merchandise calculated by the accounting books if they are well-composed or by the opinion of experts.

III. If to appraise the amount of the guarantee, the court does not have the information referred to in the two fractions that precede, the judge will do so according to his prudent discretion, taking care that the interests of the Estate are guaranteed.

These requirements are also applicable to definite Executors of the Estate.

The provisional Executor of the Estate will receive the decedent’s assets and shall acquire the character of a mere depositary without being able to perform other administrative functions than those of mere conservation and those that refer to the payment of mortuary debts, according to judicial authorizations.

In the meantime, with the express authorization of Chihuahua’s State Civil Court, he could file claims against debtors of the Estate or other parties as long the lawsuits benefit the Estate.

Both intestate and probate Estate processes must contain these elements:

1.- The notice of the intestacy or the existence of the decedent’s will.

2.- The service of summons of all possible and declared heirs and the legatees.

3.- Matters relating to the appointment and removal of the Estate’s Executor or interveners and the recognition of hereditary rights.

4.- The ruling on the will’s validity, the legal capacity to inherit, and the rights preference.

5.- The inventory and appraisal formulated by the Executor of the Estate.

6.- Matters relating to administration, accounts, gloss, and qualification of the decedent’s assets.

7.- The project of provisional distribution of the proceeds and products of the goods hereditary.

8.- The project for distributing provisionally the decedent’s assets and the Executor of the Estate accountability.

9.- Matters relating to the distribution and allocation of the decedent’s assets.

10.- All the motions filed under the whole process and their interlocutory judgments.

This process only occurs when there is a decedent’s will, and eventually, the court declares its validity. Although this process could be thought of as faster at first glance, it can last years or decades, depending on the number of parties mentioned in the will.

After the declaration of validity of the decedent’s will, the Civil Court must order a service of summons over all heirs, legatees, Executor, or Executors of the Estate mentioned in the will so that within ten business days from the summons of each one of them, a meeting of heirs takes place.

If the addresses of the heirs are not known, the court shall issue an order providing for a summons by publication in 1) a newspaper of local or State circulation, 2) on the court’s bulletin board, 3) on the last decedent’s domicile, and 4) on the domicile of the decedent’s birthplace.

Heirs who reside outside the place of the trial will be summoned employing a rogatory letter according to international treaties.

If the will is not contested, the Civil Court shall determine those mentioned in his will as the decedent’s heirs and legatees in the amount he planned.

Likewise, the definitive Executor of the Estate shall be appointed according to the decedent’s intentions. After he accepts the charge, he must comply with the guarantees and rules mentioned in the previous section of this entry.

Those parties dissatisfied with the declaration of heirs and legatees can challenge that status by filing a civil claim, which in no case will halt the probate process. Therefore, there is no kind of injunction when a legal remedy is sought.

Within 5 business days of accepting the charge of as definitive Executor of the Estate, he shall give notice to the court, heirs, legatees, and creditors of the Estate about the formation of its inventory and appraisal.

In the motion where the Executor of the Estate informs of the formation of the inventory and appraisal, he must indicate the date, hour, and place in which the meeting will be held. Moreover, he must appoint expert witnesses to assess the Estate, such as valuation experts, accountants, etc., and those who will help him tailor the inventory and appraisal.

The inventory and appraisal are conducted in a meeting in the presence of all interested parties, generally held in the Executor of the Estate’s attorney’s offices.

Once the date takes place, the Executor of the Estate, in the presence of all interested parties, shall proceed to form the inventory and appraisal describing as clearly as possible the decedent’s Estate in the following order: 1) money; 2) jewelry; 3) commercial papers (stocks, bonds, etc.); 4) live goods (cattle, exotic animals, etc.); 5) proceeds; 6) goods; 7) real estate; 8) credits; 9) other important documents, and finally 10) contracts that the decedent had in his favor, such as bailment, lease, pledges, etc.

After the meeting, the Executor of the Estate will have 60 business days to inform the court of the decedent’s Estate’s value and add the inventory and appraisal to the case’s docket.

Once the inventory and appraisal are done and included in the case’s docket, all parties (heirs and creditors) have 3 business days to oppose the decedent’s Estate value.

For the court to proceed with the opposition, it is essential that when formulating it, the opposing party expresses explicitly what value it attributes to each one of the assets and attaches the evidence as the basis of his objection.

Once the above has been complied with, a hearing will be held, and there orally, the judge must resolve whether he approves the inventory and appraisal, issuing an interlocutory judgment.

The parties can contest the judgment that disapproves the inventory and appraisal through an appealing relief, which, in its admission, the court shall grant an injunction. Therefore, the probate process shall halt until the magister resolves the case in the appeal court.

If the inventory and appraisal are not contested by anyone and are not marred by legal defects, the court shall approve them, and the second stage of the probate estate process will end.

At the time the definitive Executor of the Estate accepts its charge, he must administer the decedent’s assets following these rules:

1.- He must pay his urgent debts with the decedent’s assets.

2.- In second place, the Executor of the Estate must pay all creditors of the Estate.

3.-He must focus on maintaining and repairing the assets.

4.- He must comply with our tax system and pay taxes to represent the decedent. For example, paying property taxes on time to Ciudad Juárez Municipality is essential.

5.- He must file all legal actions to increase the decedent’s assets, such as collecting debts, awards, enforcing judgments, etc.

6.- Similarly, the Estate’s Executor shall answer all claims against the Estate and defend its assets.

7.- The Executor of the Estate can sell its goods and use its money or proceeds to pay a debt or an urgent expense, but only if the majority of heirs and legatees give their express consent.

8. The Executor of the Estate can lease the decedent’s real estate for up to one year. If he wishes to lease for more time, the heirs’ and legatees’ consent is required.

9.- Every year the Executor of the Estate must report to all parties the whereabouts of his administration. If he doesn’t comply with this, he can be removed by the court.

10.- Exceptionally, the Executor of the Estate can sell the decedent’s real estate in order to pay his debts, but with the express consent of all parties involved in the probate process.

Finally, the Executor of the Estate must attach his general account to the case’s docket, setting out how he used the decedent’s assets to pay debts, what credits he collected, and so on.

All parties shall have 5 business days to present their opposition to the general account. If there are merits, the judge shall set up a hearing to resolve the issue through an interlocutory judgment.

After the general account is approved by legatees and heirs or by the court, the third stage of the probate estate process shall end.

In the next 5 business days after the approval of the general account, the Executor of the Estate must present to the court the project of distribution of the decedent’s assets.

This stage is the zenith of the whole process, and its regulation is broader than other stages of the intestate process. This is due to the fact that it would depend on the decedent’s assets to weigh how complicated the distribution would be.

For example, in Ciudad Juárez, according to article 27, paragraph tenth of the Mexican constitution, foreigners cannot hold ownership of the land. article that literally states:

“[…] Only those persons recognized as Mexicans by birth or by naturalization, as well as Mexican corporations, shall have a right to acquire legal domain over lands, waters, and their accessories. They shall also be entitled to acquire permits in order to exploit mines and waters. The State can grant the same right to foreigners as long as they agree with the Ministry of Foreign Affairs to be considered Mexican nationals with respect to such resources and to decline, therefore, any right to be legally protected by their national governments in case of being involved in a controversy about the resources; such an agreement’s breach shall be penalized by transferring the contested resources back to the Nation. Within a strip of one hundred kilometers from the national borders inland and fifty kilometers from the seashore inland, foreigners shall never be allowed to acquire direct domain over lands and waters”. […]

Therefore, in the project of distribution of the decedent’s assets, the Executor of the Estate shall tailor a way to benefit the Estate’s heirs, such as entering into a trust agreement, selling the real estate, etc. However, as a general rule, it must conform to the will of the author of the succession, as it is a probate estate process and it involves a will. Only in the event that there are assets not contemplated in the will the distribution must be made in accordance with the rules governed by the Civil Code of the State of Chihuahua according to the interstate process and rules.

This final chapter cannot be treated isolated without considering the decedent’s assets because the advice a capable attorney could provide to the Estate’s executor depends on the nature of those assets.

Finally, since this blog entry is just for informational purposes, I cannot provide all the legal hypotheses that the Estate’s Executor shall comply with to convey the decedent’s assets to its heirs. Hence, it’s essential to seek legal advice at this stage unless the decedent’s assets are so scanty that it’s quite easy to allocate them.

As I said before, most of the rules applicable to the probate Estate processes share common grounds with intestates, so in some parts of this section, intestate’s rules will be the same. However, this process is applicable when:

1) When there is no will.

2) When the will is vacated or has lost its validity

3) When the testator did not dispose of all his assets in the will

Petitioners who have an interest in the decedent’s Estate, either because they think are possible heirs or creditors, must file an initial motion denouncing the decedent’s death and attaching its death certificate issued by the Civil Registry of the State of Chihuahua.

In that motion, petitioners shall indicate and prove the degree of affinity or relationship with the decedent. Moreover, they shall indicate all the possible heirs they are aware of, providing their names and addresses to be summoned by the court.

In any case, the court shall formally request the Civil Registry of the State of Chihuahua to know the decedent’s closest relatives up to the fourth collateral degree.

After the court is aware of all possible heirs of the decedents, it shall order a service of summons over all of them. Likewise, the court shall urge to appoint an Executor of the Estate whom the majority vote will elect.

If the addresses of the possible heirs are not known, the court shall issue an order providing for a summons by publication in 1) a newspaper of local or State circulation, 2) on the court’s bulletin board, 3) on the last decedent’s domicile, and 4) on the domicile of the decedent’s birthplace.

According to international treaties, possible heirs who reside outside the place of the trial will be summoned using a rogatory letter.

Since this inheritance process is based on the relationship of the possible heirs with the decedents, the court shall weigh whose kinship is nearest.

Have the right to inherit by intestate, in this order:

1) Descendants

2) Surviving spouse or concubine resulted from the common-law marriage

3) Ascendants

4) Collateral relatives up to the fourth degree

5) In the absence of the people included above, the public assistance.

A few notes must be taken into account:

1) Straight-line relatives exclude collateral and closest relatives to the furthest ones. 2) Relatives in the same degree shall inherit in equal parts. Finally, 3) surviving spouses or concubines don’t inherit if the decedent’s descendants are alive unless they don’t have enough assets to ensure their livelihood.

Those parties dissatisfied with the declaration of heirs can challenge that status by filing a civil claim, which in no case will halt the probate process. Therefore, there is no kind of injunction when a legal remedy is sought.

Within 5 business days of accepting the charge of as definitive Executor of the Estate, he shall give notice to the estate’s court, heirs, and creditors about the formation of its inventory and appraisal.

In the motion where the Executor of the Estate informs of the formation of the inventory and appraisal, he must indicate the date, hour, and place in which the meeting will be held. Moreover, he must appoint expert witnesses to assess the Estate, such as valuation experts, accountants, etc., and those who will help him tailor the inventory and appraisal.

The inventory and appraisal are conducted in a meeting in the presence of all interested parties, generally held in the Executor of the Estate’s attorney’s offices.

Once the date takes place, the Executor of the Estate, in the presence of all interested parties, shall proceed to form the inventory and appraisal describing as clearly as possible the decedent’s Estate in the following order: 1) money; 2) jewelry; 3) commercial papers (stocks, bonds, etc.); 4) live goods (cattle, exotic animals, etc.); 5) proceeds; 6) goods; 7) real estate; 8) credits; 9) other important documents, and finally 10) contracts that the decedent had in his favor, such as bailment, lease, pledges, etc.

After the meeting, the Executor of the Estate will have 60 business days to inform the court of the decedent’s Estate’s value and add the inventory and appraisal to the case’s docket.

Once the inventory and appraisal are done and included in the case’s docket, all parties have 3 business days to oppose the decedent’s Estate value.

For the court to proceed with the opposition, it is essential that when formulating it, the opposing party expresses explicitly what value it attributes to each one of the assets and attaches the evidence as the basis of his objection.

Once the above has been complied with, a hearing will be held, and there orally, the judge must resolve whether he approves the inventory and appraisal, issuing an interlocutory judgment.

The parties can contest the judgment that disapproves the inventory and appraisal through an appealing relief, which, in its admission, the court shall grant an injunction. Therefore, the probate process shall halt until the magister resolves the case in the appeal court.

If the inventory and appraisal are not contested by anyone and are not marred by legal defects, the court shall approve them, and the second stage of the intestate process will end.

At the time the definitive Executor of the Estate accepts its charge, he must administer the decedent’s assets following these rules:

1.- He must pay his urgent debts with the decedent’s assets.

2.- In second place, the Executor of the Estate must pay all creditors of the Estate.

3.-He must focus on maintaining and repairing the assets.

4.- He must comply with our tax system and pay taxes to represent the decedent. For example, paying property taxes on time to Ciudad Juárez Municipality is essential.

5.- He must file all legal actions to increase the decedent’s assets, such as collecting debts, awards, enforcing judgments, etc.

6.- Similarly, the Estate’s Executor shall answer all claims against the Estate and defend its assets.

7.- The Executor of the Estate can sell its goods and use its money or proceeds to pay a debt or an urgent expense, but only if the majority of heirs give their express consent.

8. The Executor of the Estate can lease the decedent’s real estate for up to one year. If he wishes to lease for more time, the heirs’ and legatees’ consent is required.

9.- Every year the Executor of the Estate must report to all parties the whereabouts of his administration. If he doesn’t comply with this, he can be removed by the court.

10.- Exceptionally, the Executor of the Estate can sell the decedent’s real estate in order to pay his debts, but with the express consent of all parties involved in the probate process.

Finally, the Executor of the Estate must attach his general account to the case’s docket, setting out how he used the decedent’s assets to pay debts, what credits he collected, and so on.

All parties shall have 5 business days to present their opposition to the general account. If there are merits, the judge shall set up a hearing to resolve the issue through an interlocutory judgment.

After the general account is approved by legatees and heirs or by the court, the third stage of the intestate process shall end.

In the next 5 business days after the approval of the general account, the Executor of the Estate must present to the court the project of distribution of the decedent’s assets.

This stage is the zenith of the whole process, and its regulation is broader than other stages of the intestate process. This is due to the fact that it would depend on the decedent’s assets to weigh how complicated the distribution would be.

For example, in Ciudad Juárez, according to article 27, paragraph tenth of the Mexican constitution, foreigners cannot hold ownership of the land. article that literally states:

“[…] Only those persons recognized as Mexicans by birth or by naturalization, as well as Mexican corporations, shall have a right to acquire legal domain over lands, waters, and their accessories. They shall also be entitled to acquire permits in order to exploit mines and waters. The State can grant the same right to foreigners as long as they agree with the Ministry of Foreign Affairs to be considered Mexican nationals with respect to such resources and to decline, therefore, any right to be legally protected by their national governments in case of being involved in a controversy about the resources; such an agreement’s breach shall be penalized by transferring the contested resources back to the Nation. Within a strip of one hundred kilometers from the national borders inland and fifty kilometers from the seashore inland, foreigners shall never be allowed to acquire direct domain over lands and waters”. […]

Therefore, in the project of distribution of the decedent’s assets, the Executor of the Estate shall tailor a way to benefit the Estate’s heirs, such as entering into a trust agreement, selling the real estate, etc.

This final chapter cannot be treated isolated without considering the decedent’s assets because the advice a capable attorney could provide to the Estate’s executor depends on the nature of those assets.

Finally, since this blog entry is just for informational purposes, I cannot provide all the legal hypotheses that the Estate’s Executor shall comply with to convey the decedent’s assets to its heirs. Hence, it’s essential to seek legal advice at this stage unless the decedent’s assets are so scanty that it’s quite easy to allocate them.

By Omar Gómez

Partner

beLegal abogados S.C

Abogados en Ciudad Juárez, Chihuahua, México

Visit my personal website at www.ogomezabogado.com

Contact the firm at [email protected]

Call (656) 774-75-73 for English assistance or (656) 271-41-43 for Spanish.

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