Inheritance due diligence

Inheritance research is in some cases associated with practical and legal ambiguities regarding inherited real estate, bank deposits, motor vehicles, securities and holdings in commercial companies, but also about obligations, or other rights, related to the testator – bank loans and others. Sometimes, however, the heirs are given deadline for accepting the inheritance, according to Art. 51 of the Inheritance Act (LA), in which they should either accept or refuse, and the request is most often made in practice by creditors of the testator, and is carried out through a bailiff. In this regard, it is extremely important for all heirs to know whether by accepting the inheritance they will become liable for old debts, or they will acquire pure property. Also, depending on the content of the inheritance, a judgment can be made as to whether to be accepted in full, to be accepted under inventory, or to make a disclaimer of inheritance, each of which options is the right choice, depending on the situation. It is important to emphasize that examining the inheritance and making inquiries is not equivalent to its acceptance, therefore each study in itself carries no risks. For heritage research the consent of the other heirs is not necessary, if any, therefore each of them independently can make a check and decide whether to accept the set left to him.

Real estate inspection

The most complex and difficult probate is that of real estate owned by the testator. The practical difficulty stems from the fact that although the Property Register, maintained by the local Registry Offices of the District Courts and maintained by the Registry Agency, is centralized and electronic, references in it are practically available for all entries, markings and deletions for properties since 1997. This means that if the testator acquired a property after 1997, this would be easily detected, but if the properties were acquired before that, or were inherited by his testators, checks should be carried out in practice in every populated place in the country, in which there is a separate Registry Office to locate immovable property. A practically working option is this is done by references in The municipalities for declared properties, c The land commissions, through the information system of The Agency for Geodesy, Cartography and Cadastre, or through verification of the testators of the testator himself – his parents, grandmothers, grandfathers, etc. In practice, it often turns out that for the complete study of an inheritance it is necessary to reach the most distant known ancestral relationships, born before Emancipation in 1878. The test for inherited real estate is often effectively a test on ownership of real estate and check for encumbrances, in so far as it is possible to prove that there are claims of third parties on an inherited property, which is important when assessing whether the inheritance should be accepted.

Inspection for motor vehicles

A reference for motor vehicles owned by the testator can be made in the relevant Directorate of the Ministry of the Interior - Control of road transport, as well as by reference to the declared property in The municipality. However, the reference from the Ministry of the Interior can show whether there are impoundments imposed on the registered motor vehicle.

Check for cash deposits and safes

The availability reference cash deposits and safes is done through The Bulgarian National Bank, which issues a list of the person's registered bank accounts and safes, the respective bank in which they are located, as well as the currency. However, for balances in the accounts and safes, additional inquiries should be made in each individual bank.

Screening for securities and holdings in commercial companies

The reference for securities takes place in Central Depository, while reference for holdings in commercial companies, as well as in non-profit companies, is carried out in the Commercial Register at the Registration Agency, as in register BULSTAT. However, the presence of shares does not mean that the inherited property constitutes an asset, and for completeness, the relevant companies should also be investigated, as far as an heir can be identified with a share in a financially unstable company, or in a company that is poorly managed.

Probate of wills

The current legislation in Bulgaria regarding the testamentary procedure is imperfect, which gives limited opportunities to check for available wills and testamentary dispositions. Wills are handwritten and notarized, and the former may not be kept everywhere, without being reflected in a register, and without anyone knowing about them at all, except those who drew them up. These types of wills are virtually impossible to find if there is no record or direction as to where they may be stored. Notarial wills, or handwritten wills left for safekeeping, can be verified through Registry Agency, as well as through the "Unity" system of the Chamber of Notaries. Here again, as with general real estate title probate, the checks are limited to wills deposited for safekeeping after 1998, and there is no universal way to check for wills deposited before that period.

Check for court cases

An often-overlooked aspect of probate is finding out the lawsuits to which the testator was a party. This is important in several directions, as it may concern properties that do not appear in the reports from the other types of inspections, as well as concern properties for which there is still no effective decision. E.g. it is possible that the testator may have sued his counterparties for sums of money, for the return or receipt of movables under contracts, as well as for immovable property, at an early stage of the cases concerning the latter. The chosen hypothesis may also be present - based on court decisions, the testator was sentenced to return sums of money. Information on closed or pending cases is of particular importance, insofar as it can show available claims of the testator, or obligations that do not appear on the other hand. In any case, however, pending cases under the law occur succession in the process and the heirs become parties to the cases - art. 227 of the Civil Procedure Code (CPC), which is why it is important to learn about such cases in time, in order to prepare well for them.

Inspection for enforcement cases for debts or claims

One of the mandatory inheritance checks, along with that for real estate and bank accounts and safes, is the one for enforcement cases. The references are in practice two, insofar as one is carried out at Chamber of Private Bailiffs, and the other is carried out at known addresses of the testator to the respective one State judicial enforcement service at the District Court. Checks are mandatory to clarify whether the testator has receivables from third parties, or whether the testator has obligations to third parties, which will be transferred to heirs upon full acceptance of the inheritance, and may influence their decision to do so.

Credit check

The check for credit obligations, registered in the central bank, is the other mandatory verification of the liabilities included in the property. The reference is made in Bulgarian National Bank, as individual loans described therein, should be checked in the individual credit institutions, creditors under them.

Check for tax and social security obligations

Public obligations to the state and municipalities can also be a huge liability in the estate, so doing this check should not be underestimated. The liability check can be made to the relevant Municipality for local taxes and fees, as well as to The National Revenue Agency on public obligations to the central budget.