A typical matter of a party renouncing an estate in Korea commences when a family member in Korea requests the waiver/disclaimer of the right to a Korean inheritance. Sometimes the waiver is for a valid reason and sometimes the Korean-based family does not have a legitimate reason for the waiver other than self-interest.
A, typical, situation involves an estate of a Korean national decadent with non-Korean family abroad. The estate, often, includes assets in Korea and sometimes abroad.
The Korean-based family, often, requests the non-Korean based family to sign a power of attorney or a document waiving the estate, thus, granting the Korean-based family total control over the estate without any guarantees of payment of the proceeds of the estate for the foreign-based family members.
For a basic understanding of Korean Interstate Succession Law and Korean Inheritance Law see: Korean Inheritance Law. The post provides a basic explanation of what families are entitled to inherit under Korean Law.
If the deceased is a national of Korea, the matter is, typically, governed under Korea’s inheritance/probate law. If the deceased is a non-Korean national, in most cases, the matter is handled under the law of the jurisdiction where the deceased was last a legal resident. Thus, the nationality of the children (hiers) has no bearing on the matter – the residence of the deceased, normally, prevails. Thus, the nationality/residence of the deceased prevails, typically, in conflict of law issues related to estate matters in Korea.
Renouncing an Inheritance in Korea
In order to renounce an inheritance in Korea, in most cases, the heir is required to make a “declaration of renunciation to the family court” (Korean Civil Act, Art. 1041) in Korea within three (3) months of notification of the inheritance to the heir. Thus, it is essential to act quickly.
Often, not renouncing an estate can lead to the assumption of the debt of the estate – a debt that is enforceable outside of Korea. Yes, a debt, in Korea, can be enforced in the States, Europe and most anywhere in the world. Courts, nearly universally, recognize judgments of Korean courts.
After termination of this period (3months), an estate, in Korea, is presumed accepted without condition. Exceptions exist.
However, the co-inheritor in Korea of a particular asset may divide the inheritance based on contract under Article 1013 of the Civil Act or gift the asset to the remaining heirs. The inability to renounce an asset, however, may create an additional taxable event.
If you believe you are the victim of an unscrupulous relative (I see this far too often), contact an attorney immediately. You often have options at the Korean courts if you act quickly and smartly.
Additionally, don’t sign an agreement that you don’t understand or you may find yourself in a debt that you wished you could avoid. Yes, again, Korean creditors can attach assets globally.
Sean Hayes is co-chair of the Korea Practice Team at IPG Legal. He is the first non-Korean attorney to have worked for the Korean court system (Constitutional Court of Korea) and one of the first non-Koreans to be a regular member of a Korean law faculty.
Sean is ranked, for Korea, as one of only two non-Korean lawyers as a Top Attorney by AsiaLaw.
- Renouncing an Estate/Inheritance under Korean Law
- Navigating Korea’s Inheritance Law: Korean Inheritance Laws Basics Explained
- Korean Intestate Succession Law: Inheriting Property from your Korean-National Parents
- Korean Inheritance Law: Who Inherits What, When & How in Korea?
- Korean Inheritance Tax for Estates in Korea
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- Korean Real Estate Acquisition Taxes for Purchase of Real Estate in Korea
- “Samsung’s First Family Struggles to Keep Grip on Company” Report by Bloomberg
- Provisional Attachments of Assets in Pending Litigation in Korea Courts
- Can Foreigners buy Real Property in Korea? Korean Real Estate Law for Non-Korean Residents and Non-Residents