The death of a family member leaving minor heirs

One of the wishes and concerns of the founders or members of the family business is that the control of the wealth and business built up by their efforts remains within the family and is not disturbed by outside interference.

We analyse possible ways of limiting unwanted interventions

One such contingency, which could affect the family business, could arise as a result of the death of a family member and participant in the family business.

It is common that, in order to continue the family character of the business, the deceased has made a provision in his will that his children should succeed him in the ownership of the shares in the family business.

In particular, after the death of the family member and shareholder in the family business who is succeeded by minor children, the surviving parent’s interference can arise at the following two points in time:

• From death until the partition of the inheritance.

During this interim, during which the inheritance remains undivided, the administration of the inherited assets is, in principle, the responsibility of the plurality of successors, who decide by majority. And for this purpose, the successors who are minors will be represented by the surviving parent, according to the law. Thus, if the minor or minors have a majority position in the community of heirs, in practice it will be the surviving parent who will determine, for example, the direction of the exercise of the political rights corresponding to the shares in the family business that form part of the inheritance.

• The second period in which the surviving parent may interfere, in the case of minor successors, is once the inheritance has been divided and the shares of the family business have been awarded to the minor, until he or she reaches the age of majority.

During this period, the surviving parent is, in principle, legally entitled to represent the minor child in the exercise of the political rights corresponding to the shares or holdings in the family business that the minor child has acquired in the estate of the deceased family member.

Conclusion

There is no general solution, but a case-by-case analysis is necessary. The determination of the obligations or burdens to be imposed on the successor to avoid external interference will depend on the particular circumstances of the family business in question.

If you have any doubts about this subject, please do not hesitate to contact us by telephone at Núria Martí García or by e-mail at nmg@btsasociados.com, we will be delighted to help you.