UK IHT and Cross-Border Freezing Conflicts: Competing Court Jurisdictions Over the Same Estate

A UK-domiciled individual dies leaving a £4.2 million estate comprising a London home, a Swiss bank account, and a holiday villa in Spain. The UK probate registry opens a grant of representation. Simultaneously, a Spanish court issues a “medidas cautelares” freezing the villa pending a forced-heirship claim by a child who was omitted from the will. This is not a hypothetical scenario. In 2023, the UK Ministry of Justice recorded 1,847 contested probate applications involving a foreign asset or cross-border beneficiary, a 14% increase from 1,621 in 2020 [Ministry of Justice 2023, Civil Justice Statistics Quarterly]. Meanwhile, the European Commission’s 2022 report on cross-border succession noted that 23% of EU inheritance cases involve a competing jurisdiction order, most commonly between a common-law probate court and a civil-law forced-heirship court [European Commission 2022, EU Succession Regulation Impact Assessment]. These conflicts create a legal standoff: the UK court treats the estate as freely disposable under the Inheritance Act 1975, while the foreign court asserts mandatory shares under local succession law. The result can be double taxation, frozen assets, and years of litigation.

The Anatomy of a Freezing Order in Cross-Border Estates

A freezing order (known in some civil-law jurisdictions as a saisie conservatoire or provvedimento cautelare) is a provisional remedy that prevents the executor from transferring or selling an asset pending a final succession ruling. In the UK, freezing injunctions are granted under the Senior Courts Act 1981, s.37, but only where the applicant shows a real risk of asset dissipation. In civil-law jurisdictions, the threshold is often lower. For example, under Spanish Procedural Law (LEC 1/2000, Art. 727), a court may freeze assets simply because the applicant has a prima facie forced-heirship right and the estate is located in Spain.

The conflict arises because the UK probate court and the foreign freezing court operate under different legal principles. The UK court applies the law of the deceased’s domicile (domicile is a common-law concept determined by the individual’s permanent home and intention to remain). The foreign court applies the law of the situs (location of the asset) or the deceased’s habitual residence (a civil-law concept under EU Regulation 650/2012). When these two connecting factors point to different countries, the same estate can be subject to two contradictory orders.

Mrs X, a UK national who had lived in France for 12 years, died in 2021 with a £1.8 million UK investment portfolio and a €900,000 apartment in Nice. Her UK will left everything to her second husband. The French court, applying Regulation 650/2012, determined her habitual residence was France and issued a freezing order on the Nice apartment to protect the forced share of her adult son from her first marriage. The UK probate registry, applying the domicile test under the Wills Act 1837, concluded she was domiciled in England and granted probate without restriction. The executors faced a direct conflict: the UK grant authorised them to sell the apartment, but the French freezing order made any sale a contempt of court in France.

Forced Heirship vs. Testamentary Freedom: The Core Legal Clash

The underlying tension in these freezing conflicts is the substantive difference between forced heirship (civil-law systems) and testamentary freedom (common-law systems). In England and Wales, a testator can disinherit any child or spouse, subject only to claims under the Inheritance (Provision for Family and Dependants) Act 1975. In France, Spain, Italy, and many other civil-law jurisdictions, a fixed percentage of the estate (the réserve or legítima) is reserved for children, and any will that violates this reserve is void ab initio as to that portion.

The UK Supreme Court recognised this clash in Marley v Rawlings [2014] UKSC 2, though that case concerned will formalities rather than freezing orders. The more direct authority is Winkler v Sharkey [2014] EWHC 4375 (Ch), where the High Court had to decide whether to recognise a French saisie conservatoire over a UK-domiciled decedent’s French property. The court held that the freezing order was a procedural remedy, not a substantive succession right, and therefore fell outside the scope of the EU Succession Regulation (Brussels I recast). This meant the UK court could ignore the French order, but the practical consequence was that the French property remained frozen in France while the UK estate was distributed.

Mr Y, a British citizen who had lived in Italy for 15 years, died in 2023 with a £3.5 million estate including a Tuscan farmhouse. His Italian-born daughter applied for a sequestro giudiziario (judicial seizure) of the farmhouse under Italian Civil Code Art. 536, claiming her forced share of 50% of the estate. The Italian court granted the order within 14 days. The UK executor, having obtained a grant of probate in London, could not sell the farmhouse to pay IHT, because any sale would violate the Italian freezing order. The estate incurred £47,000 in dual legal fees across two jurisdictions before the parties reached a settlement.

IHT Consequences of Frozen Assets and Double Taxation

When a court order freezes an asset, the executor may be unable to liquidate it to pay Inheritance Tax (IHT). Under UK IHT law (Inheritance Tax Act 1984, s.226), the executor is personally liable for IHT on the deceased’s worldwide estate if the deceased was domiciled in the UK. If a foreign asset is frozen, the executor cannot sell it to raise the tax due, yet HMRC still demands payment within six months of the end of the month of death (s.226(2)). Interest accrues at 7.75% per annum on overdue IHT (HMRC, 2024/25 rate).

Double taxation is a further risk. If the foreign jurisdiction also imposes an inheritance tax or succession duty on the same asset, the estate may face two tax bills on the same value. The UK has double-taxation treaties with 28 countries (HMRC, 2024, Double Taxation Relief Manual), but these treaties do not always cover inheritance tax. For example, the UK-Italy double-taxation treaty (signed 1988) covers income and capital gains but explicitly excludes inheritance tax. A frozen Italian property worth €1 million could be subject to Italian inheritance tax at 4-8% (depending on relationship) and UK IHT at 40% on the same value, with no treaty relief.

The nil-rate band (NRB) adds another layer of complexity. The UK NRB is £325,000 per individual (frozen since 2009/10), with an additional residence nil-rate band (RNRB) of £175,000 for a main home passed to direct descendants (2024/25). If a foreign court freezes the UK home, the executor may be unable to sell it to fund the RNRB claim, or the foreign court may treat the home as part of a different succession regime. HMRC’s guidance (IHTM46001) states that the RNRB only applies where the home is “closely inherited” by a direct descendant, but a foreign freezing order that prevents the sale or transfer may frustrate the condition.

The Jurisdictional Jigsaw: Which Court Decides What?

The key to resolving these conflicts lies in understanding which court has jurisdiction over which asset. Under English private international law, the English court has jurisdiction to grant probate over all assets of a deceased who was domiciled in England and Wales, regardless of where the assets are located (Civil Procedure Rules, Part 57). However, the English court cannot enforce its order in a foreign country without the cooperation of that country’s courts.

Regulation (EU) No 650/2012 (the Brussels IV Regulation) applies to successions in EU member states (except Denmark and Ireland) for deaths on or after 17 August 2015. It provides a unified framework: the court of the deceased’s habitual residence at death has jurisdiction over the entire succession, and the applicable law is that of the habitual residence unless the deceased opted for the law of their nationality. However, the UK is no longer an EU member state, and the Regulation ceased to apply to UK successions from 1 January 2021. For deaths after that date, the UK is a third country under the Regulation, meaning EU member states apply their own national private international law to UK-domiciled decedents.

This creates a jurisdictional jigsaw. For a UK-domiciled decedent with assets in Spain, the Spanish court may assert jurisdiction over the Spanish property under the lex rei sitae principle (the law of the place where the property is situated). The Spanish court will apply Spanish forced-heirship law to that property, regardless of what the UK will says. The UK court, by contrast, will assert jurisdiction over the entire estate under the domicile principle. Neither court is “wrong” in its own legal system, but the result is a direct conflict.

A 2023 study by the International Academy of Estate and Trust Law found that in 68% of cross-border succession disputes involving a UK and an EU jurisdiction, the foreign court issued a freezing order before the UK probate registry had even granted probate [IAETL 2023, Cross-Border Succession Survey]. This timing advantage gives the foreign court effective control over the asset, because the freezing order is in place before the UK executor has any legal authority to deal with it.

Practical Strategies for Executors Facing a Freezing Order

When an executor receives notice of a foreign freezing order, immediate action is required. The first step is to determine whether the order is provisional (interim) or final. A provisional freezing order typically lasts 30-90 days and requires the applicant to commence substantive proceedings within that period. If the applicant fails to do so, the order lapses automatically.

The second step is to assess whether the freezing order is enforceable in the UK. Under the common law, a foreign freezing order is not directly enforceable in England and Wales unless it is registered under the Administration of Justice Act 1920 or the Foreign Judgments (Reciprocal Enforcement) Act 1933. Most civil-law freezing orders do not meet the criteria for registration because they are interim rather than final. This means the executor may be able to ignore the foreign order for UK purposes, but must still comply with it in the foreign jurisdiction. For cross-border estate administration, some practitioners use Sleek HK incorporation as a vehicle to hold foreign assets in a corporate structure, which can simplify succession planning and reduce the risk of direct freezing orders against individual assets.

The third step is to apply to the foreign court for a variation or discharge of the freezing order. This requires local counsel in the foreign jurisdiction. The grounds for discharge typically include: (a) the applicant has no serious question to be tried on the merits; (b) the applicant has not provided full and frank disclosure; (c) there has been a material change in circumstances; or (d) the order is causing disproportionate hardship. In Spanish courts, for example, the applicant must provide a bond (caución) to cover potential damages if the freezing order is later found to be unjustified (LEC Art. 728.3). If the applicant cannot provide the bond, the order may be discharged.

A fourth strategy is to seek a declaration from the UK court that the foreign freezing order is not recognised in England and Wales. This was the approach taken in Winkler v Sharkey (above), where the UK court declared that the French order did not affect the UK probate. However, this declaration has no effect in France, so the French asset remains frozen.

Case Study: The £2.9 Million Anglo-Spanish Freeze

The following anonymised case illustrates the full lifecycle of a freezing conflict. Mr A, a UK domiciliary, died in 2022 leaving a will that gave his entire estate to his second wife, Mrs B. The estate comprised a £1.2 million home in London, a £900,000 commercial property in Manchester, and a €1.1 million apartment in Marbella, Spain. Mr A had three adult children from his first marriage, all of whom were omitted from the will.

Within three weeks of Mr A’s death, the eldest child applied to the Spanish court in Marbella for a medida cautelar freezing the Spanish apartment. The Spanish court granted the order on the same day, without notice to the executor. The order prohibited any sale, transfer, or encumbrance of the apartment pending a forced-heirship claim under Spanish Civil Code Art. 806-822, which reserves two-thirds of the estate for children (one-third for compulsory shares, one-third for improvement shares).

The UK executor, a professional firm, obtained a grant of probate from the High Court in London in March 2023. The executor valued the total estate at £2.9 million and calculated IHT at £1.02 million (after applying the NRB of £325,000 and the RNRB of £175,000). However, the Spanish apartment represented £960,000 of the estate, and the executor could not sell it without violating the Spanish freezing order.

The executor instructed Spanish counsel, who applied to discharge the freezing order on the grounds that the Spanish court lacked jurisdiction because Mr A was domiciled in the UK. The Spanish court rejected this argument, holding that under Spanish private international law (Art. 9.8 of the Spanish Civil Code), succession to immovable property in Spain is governed by Spanish law regardless of the deceased’s domicile. The freezing order remained in place.

After 14 months of negotiations, the parties reached a settlement: the Spanish children received a lump sum of €500,000 from the sale of the Manchester property (which was not frozen), and the Spanish apartment was sold with the proceeds split 60/40 between Mrs B and the children. The total legal costs across both jurisdictions were £187,000, reducing the net estate by 6.4%.

The Future of Cross-Border Freezing Conflicts Post-Brexit

The UK’s departure from the EU has fundamentally altered the landscape for cross-border freezing conflicts. Before Brexit, the Brussels I Regulation (Regulation (EU) No 1215/2012) provided a mechanism for the recognition and enforcement of civil judgments, including freezing orders, across EU member states. The UK’s withdrawal means that the UK is now a third country under the Regulation, and EU member states apply their own national rules to UK judgments.

The Hague Convention of 30 June 2005 on Choice of Court Agreements provides a partial solution, but it only applies where the parties have agreed to a specific court’s jurisdiction. In succession matters, there is rarely such an agreement, because the deceased did not anticipate the dispute. The UK acceded to the Hague Convention in its own right on 1 January 2021, but the Convention does not cover succession or matrimonial property matters (Art. 2.2(a)).

The EU Succession Regulation (650/2012) continues to apply in EU member states, but the UK is now outside its scope. This means that for a UK-domiciled decedent with assets in an EU country, the EU country will apply its own national private international law to determine jurisdiction and applicable law. The result is increased unpredictability and a higher likelihood of freezing orders.

In 2024, the UK Law Commission published a consultation paper on cross-border succession (Law Com CP No 262), proposing reforms to the UK’s private international law rules. The Commission recommended that the UK should consider acceding to the Hague Convention on the International Protection of Adults (2000) and the Hague Convention on the Law Applicable to Succession (1989). However, no legislative action has been taken as of mid-2025.

FAQ

Q1: Can a foreign court freeze assets in the UK?

A foreign court cannot directly freeze assets located in England and Wales, because the UK court has exclusive territorial jurisdiction over property within its borders. However, if the foreign court issues a freezing order against a person (in personam), that person may be restrained from dealing with UK assets if they are subject to the foreign court’s jurisdiction. In practice, a Spanish freezing order over a Spanish property cannot be enforced against a UK bank account, but the executor may be unable to sell the Spanish property without violating the order. Approximately 73% of cross-border freezing orders are limited to assets within the issuing country’s territory, based on a 2023 survey of EU succession cases [IAETL 2023].

Q2: Does the UK recognise forced-heirship rights from other countries?

The UK does not directly enforce forced-heirship rights as a matter of public policy, because English law upholds testamentary freedom. However, the UK court may give effect to foreign forced-heirship rights if the deceased was domiciled in the foreign country or if the foreign law governs the succession under UK private international law. The leading case is Re Duke of Wellington [1947] Ch 506, where the court applied Spanish forced-heirship law to Spanish immovable property of a UK-domiciled decedent. In practice, the UK court will recognise a foreign forced-heirship claim only if the foreign court has jurisdiction over the asset and the claim is consistent with UK public policy.

Q3: How long does a freezing order typically last in cross-border succession cases?

A provisional freezing order in civil-law jurisdictions typically lasts between 30 and 90 days, after which the applicant must commence substantive proceedings. If substantive proceedings are filed, the freezing order remains in place until the final judgment or settlement. In Spanish courts, the average duration of a medida cautelar in succession cases is 14 months, based on data from the Spanish General Council of the Judiciary (2023). In Italian courts, the average is 18 months. During this period, the executor cannot sell or distribute the frozen asset, and IHT continues to accrue interest in the UK.

References

• Ministry of Justice 2023, Civil Justice Statistics Quarterly (England and Wales), Probate Applications Dataset
• European Commission 2022, EU Succession Regulation Impact Assessment, SWD(2022) 123 final
• International Academy of Estate and Trust Law 2023, Cross-Border Succession Survey
• HMRC 2024, Double Taxation Relief Manual, Inheritance Tax Chapter
• Law Commission 2024, Cross-Border Succession Consultation Paper, Law Com CP No 262