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Debt collection in the case of a deceased debtor requires special skills and must be approached by following a specific strategic process.
In this article:
Recovering a debt, as is well known, is no picnic. The procedure becomes more complicated when the debtor dies, leaving the creditor with the burden of taking action to track down and warn any heirs, urging them to pay what is owed.
But are heirs really obliged to pay the debts of the deceased? How do you trace heirs when there is no will? And what to do if the heirs renounce the inheritance?
There are many possible scenarios, but reaching the result is possible. In this article we will see how to do it, step by step.
The law stipulates that, upon the death of the debtor, it is the heirs, personally and in proportion to their share of the inheritance, who must take on the debts and burdens of inheritance.
The first step, in the case of debt collection, is to trace the heirs, an operation that may prove more or less complex (especially when the heirs are numerous and located throughout the country, perhaps even abroad). This, for example, is one of the cases for which it is preferable to rely on the assistance of a lawyer.
The lawyer in charge of recovering the claim extracts historical family status certificates, visas, consults the General Register of Wills at the notarial archives etc.
For identifying heirs, in some cases one can rely on a will (this is the so-called testamentary succession) in other cases, when a will is missing, one must instead rely on the criteria established by the Italian Civil Code (see the article).
All in all, the creditor through his lawyer will necessarily have to take care of identifying the heirs and verifying whether the identified individuals are actually obligated to pay the debts of the deceased. Let us see exactly how.
Although it seems obvious, one can take action against the heir only if the heir has accepted the inheritance (Article 459 of the Civil Code). Prior to acceptance, those designated in the will or entitled to succeed by law are merely “called”.
Acceptance may be express or silent (art. 474 Civil Code) but remains, in any case, an indispensable prerequisite for claiming payment from heirs.
The assistance of a lawyer, in this sense, can help to recognize so-called tacit acceptances (often difficult to ascertain in practice) and create the prerequisites for a recovery action. But that is not all.
In the case of pure acceptance, the creditor will not encounter any particular problems. The heir’s assets will merge with those of the deceased debtor, and the creditor will be able to act to obtain payment of his claim in full.
When the heir, on the other hand, renounces the inheritance, he or she will not be liable in any way for the debts of the estate. Moreover, it often happens that the called party accepts the inheritance with the so-called “benefit of inventory” (Article 470 of the Civil Code).
In the latter case, the heir will be required to answer for the debts of the deceased exclusively with the assets received as inheritance and within the limits of their value. In short, beneficial acceptance allows the heir not to risk more than what he received with the bequest.
Let’s be clear, in order to obtain all this information, as a matter of practice, recovery is initiated by sending a cease and desist letter to those who have been identified as possible heirs.
Having received notice of the debtor’s death, once the heirs have been identified, the creditor’s lawyer proceeds with the intimation by sending a demand letter for payment.
This step is crucial because it will also (and especially) serve to interrupt any statute of limitations.
In the event that the heirs who have accepted the inheritance refuse to pay, the creditor can take legal action against them by applying to the competent court, for example, for the issuance of an injunction, and then proceed by seizing both the property received as part of the inheritance and the heir’s personal property (so-called forced execution).
The tracing of attachable assets, as a matter of practice, is done with the support of the debt collection lawyer. It will be possible to locate both movable and immovable property owned by the heirs, but also any bank/postal accounts, wages received and pensions.
Upon completion of all relevant registry checks and after sending the letter of notice, it may happen that the person called to the estate responds that he or she has not yet decided whether to accept or renounce.
During the pendency of the ten-year period, the creditor, in order to speed up the time, may exercise the so-called actio interrogatoria under Article 481 of the Civil Code.
This is because the right to accept or renounce the inheritance is prescribed in ten years, which runs from the day of the opening of the succession.
In order not to wait ten years, the creditor may ask the court to set a time limit within which those called to the estate must declare whether they intend to accept or renounce.
In any case, in the meantime, the estate can be managed through the so-called receiver of the dormant estate. In fact, the creditor can both request his or her appointment and satisfy himself or herself on the assets of the estate lying in abeyance. Let’s see how.
Between the opening of the succession and the acceptance of the named parties, the need arises to request the appointment of a receiver of the estate (Article 528 of the Civil Code) in order to prevent, among other things, the assets from being dispersed.
After all, should it be decided to institute enforcement proceedings during the aforementioned period, it will be the receiver of the estate who will “suffer” it (so much so that the acts will be served directly on the latter).
The creditor may apply to the competent court for the appointment of a receiver of the estate when:
Indirectly, the cooperation and role of the curator are central to increasing the chances of obtaining satisfaction of the claim.