Estate succession planning – Death brings with it countless difficult matters to deal with; among them, the succession of assets. Despite the sensitivity of the moment, the Code of Civil Procedure, in article 611, imposes a deadline of up to 2 (two) months for the probate and estate-partition proceedings to be commenced, counted from the date of death.
In view of this short deadline, families are compelled to make decisions that, often, would not be adopted if they were able to plan the division of the assets and the means to be employed for their perpetuation and increase.
When building wealth, the person responsible intends for it to be kept within the family and to continue generating returns beyond their own existence, thereby ensuring the financial security of their heirs.
In this context, the succession of assets emerges as a strategic ally for those who wish to safeguard their loved ones upon their death, since it makes it possible to draw up a plan in which the recipients of the wealth and its respective administration will be designated.
And not only that. Estate succession planning prevents the possible onset of conflicts among family members regarding a given asset, or even the squandering of the wealth. It is therefore recommended for all who have acquired divisible assets and who have more than one heir, since, if there is only one, that person will be the recipient of all the assets.
Where there is a plurality of heirs and assets to be partitioned, it is prudent to carry out estate succession planning, since the holder of the wealth may, while alive, give their assets the purpose they intend and stipulate how the continuity and maintenance of the acquired assets will take place.
Understand when to opt for estate succession planning
The concentration of assets in the name of a single person becomes extremely bureaucratic upon their death. Let us consider the following scenario. A family owns a property that is leased to a large supermarket chain. In the interval between the owner’s death and the division of the assets, the supermarket chain files a lease-renewal action, combined with a request for revision of the rent, seeking a 40% reduction in the amount and an extension of the contract for a further 10 years.
In this scenario, the matter would have to be referred to the probate court and, furthermore, to the will of the parties, with unanimity being required for a decision to be made.
Imagine the passage of time between all the procedural acts and the possibility that unanimity in the decision may not exist, which could lead to the loss of the contract and to the severing of the source of income that supports the heirs.
Taking the same hypothetical case as a basis, if the owner of the property carries out estate succession planning, establishing rules among the heirs with premises for decision-making, focusing on the perpetuation of the wealth and the maintenance of the family income, the decision of the majority will prevail over the minority. And the matter will be resolved within a reasonable time so as not to generate conflict with the opposing party.
Estate succession planning requires a multidisciplinary team
For estate succession planning to be efficient and for its effects to multiply in the future, a study by a plural legal team is necessary, including professionals with experience in various areas, among them: Civil Law, Family Law and Tax Law.
Depending on the assets to be included in the planning, the participation of an accountant and a financial advisor will also be necessary, all acting together to make the interests of the holder of the wealth and of their family members viable.
Owing to the plurality of areas involved, the process of drawing up the planning until its implementation will take, on average, six to eighteen months, and an extension of this period may be necessary if there is a need to implement corporate governance.
In addition to the capabilities and specifications pertinent to the interests of the prospective heirs, the professionals responsible for conducting the estate succession planning must be endowed with the sensitivity to listen to and understand the family’s interests and needs.
Estate succession planning is currently the most efficient means for preserving wealth and maintaining the family’s financial security, allowing the heirs to go through such a painful moment with greater security and stability. However, it is important to ensure that this matter is handled with specialized professionals, as noted above.
Over the years, here at the firm Lassori, we have developed an exclusive methodology for handling estate succession planning, including all legal, administrative and corporate governance aspects.
We also understand that, beyond the legal aspects, it is important for us to work on family counseling, through clear, direct and explanatory language, in order to act as mediators so that everyone agrees on the partition and perpetuation of the wealth.
If you wish to delve deeper into the topic or want to receive more information, get in touch with us.
By Juliana Assolari and Yanna Pierrondi, both attorneys at the firm Lassori Advogados.
Article previously published on the profile of Juliana Assolari, on Linkedin.
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