IN RE: the ESTATE of Magdalena CHICHERNEA

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District Court of Appeal, Second District, Division 2, California.

IN RE: the ESTATE of Magdalena CHICHERNEA, Deceased. ELEANORE G. SIDFLETEA et al., Petitioners and Appellants, v. STATE of California and Bank of America National Trust and Savings Association, Respondents.

Civ. 29301.

Decided: September 07, 1966

Mosk & Rudman, by Edward Mosk, Los Angeles, for appellants. Thomas C. Lynch, Atty.Gen., Elizabeth Miller, Deputy Atty.Gen., for respondent State. Chas. T. Rippy, Torrance, for respondent, Bank of America Nat. Trust and Savings Assn.

Petitioners herein are Rumanian citizens and legatees under the Last Will of Magdalena Chichernea who dies in this state on April 15, 1958..  A trial was held on the petition to determine heirship filed November 3, 1959.   The sole issue in said trial and on this appeal, is the right of petitioners to inherit under the provisions of Probate Code, § 259 1 which requires a reciprocal right to inherit by Americans in the country wherein petitioners reside.

Opposing the petition is the State of California which claims the property in the estate by escheat (Probate Code, § 259.2).

The trial court determined that the People's Republic of Rumania did not grant reciprocal inheritance rights as of the date of death and awarded the property to the state.   Petitioners appeal.

 The burden of establishing the existence of reciprocal rights of inheritance is on the alien petitioners (Probate Code, § 259.1).   Since 1957 the question of foreign laws has been a matter of judicial notice (Code of Civil Procedure, § 1875(4)), reviewable de novo by this court.

Our determination in the present case is based on all the information provided by counsel irrespective of evidentiary objections made in the trial court.

 The parties agree that the law of Rumania on the date of death, April 15, 1958, controls the outcome of this case.  (Estate of Arbulich, 41 Cal.2d 86, 89, 257 P.2d 433.)

California has once before decided the right of Americans to inherit under Rumanian law.  (Estate of Kennedy, 106 Cal.App.2d 621, 235 P.2d 837.)   The Kennedy case, however, was decided in 1951, at a time when the determination of foreign law was a question of fact rather than judicial notice.   Although that opinion sustained a finding by the trial court that reciprocal rights of inheritance existed, we are not bound by that decision since the only question on appeal was the sufficiency of the evidence to support the findings below.

Resolution of the issue is complicated by the absence of any specific textual reference in Rumanian law and by the advent of socialism in that country.2

At trial and on this appeal, however, there is considerable evidence to assist the court in its determination of the law of Rumania on April 15, 1958, specifically with regard to the rights of aliens to inherit from decedents in Rumania.

We commence our analysis of the record in the case at bench in the light of guidelines enunciated in Larkin, supra.   The court says:

“Though section 259 requires only the demonstration of a ‘reciprocal right’ on the part of our citizens ‘to take property upon the same terms and conditions' as residents of the foreign country itself, we doubt that mere equality of treatment would suffice.   We would almost certainly not find the requisite reciprocity with respect to a country which permitted no inheritance at all, or which made the enforcement of inheritance rights subject to official whim or caprice.   Though the statute speaks in terms of equal treatment, we believe that it necessarily imports a requirement that the inheritance rights recognized in the foreign country meet some minimal standard of economic substantiality and that it be shown that such rights are regularly recognized in practice.

“On the other hand, the fact that another country recognizes property interests of different scope and content than those which prevail in California, establishes its government on a different pattern than our own, or embraces a political philosophy rejected by our people, does not necessarily negate the existence or reciprocal inheritance rights.  Section 259 does not confer upon our courts a broad charter to invalidate gifts made by our citizens to the residence of countries whose patterns of government, political philosophies, or domestic or foreign policies we dislike.  * *.”  (P. 54, 52 Cal.Rptr. p. 444, 416 P.2d p. 476.)

 On the ground that Rumanian law discriminates against foreigners in the actual delivery of property as herein pointed out, form a Rumanian decedent to an American heir, we conclude that there is no reciprocal right of inheritance within the meaning of Probate Code, § 259.

Mr. George Crisan, an expert on Rumanian law, called by the State, prepared a memorandum on various aspects of reciprocal inheritance rights in Rumania.   He included therein his translation of the official text of Act No. 169 of March 4, 1941 entitled “Control of Foreigners' Acts of Disposition”, as follows: 3

“Article 1. Paragraph 1.   Foreigners shall not be allowed to dispose of any part of their property right or interests in Rumania except by advance authorization by the Department of National Economy.

“1. Pursuant to Act No. 335 of August 26, 1949, the authorization provided for under Article 1 shall be issued by the Department of Justice.

“2. Pursuant to Article 2, Act No. 351 of May 2, 1942, an advance authorization is required in all disposals regarding property rights and interests whereby a foreigner disposes of or a foreigner acquires property rights or interests.

“Article 2. The following acts shall not be deemed acts of disposition:  acts in connection with the management of a business company;  acts in connection with the usual management of property rights or interests, or acts concerning maintenance.

“Article 3 [as amended by Article 3 of Act No. 351, May 2, 1942].  Pursuant to this Act, foreigners shall be deemed:  individuals of foreign nationality regardless of their domicile * * *.

“ * * *.”

In his memorandum, Mr. Crisan gives the following discussion of the foregoing law:

“Foreigners may not dispose of or acquire property rights or interests in Rumania unless previously authorized to do so by the Department of Justice.  * * * There are no criteria to guide that department in determining when it will issue such authorizations.   No judicial or administrative authority gives assistance to a foreigner in disposing of his property in Rumania or in transferring the proceeds or personal property abroad without an advance authorization by the Ministry of Justice.

“I have inquired of lawyers who have clients with interests in Rumania.   No one was ever able to secure any transfer of any money or any goods from Rumania to the United States.

“There is no law or regulation in Rumania, as far as I am aware, to provide for the rights of a foreign beneficiary in a Rumanian estate, if such an estate exists.   There is no provision under the law that a foreigner may file claim either against an administrative authority who does not reply or react in any way to his claim or against a party who refuses to deliver goods due to the foreigner.”

Petitioners, who carry the burden of proof generally, and the burden of coming forward with evidence in this particular matter, have not produced any evidence of any criteria utilized in the regulation of foreigners' dispositions of property.

On direct examination, Mr. Crisan testified that Act 169 was in effect on April 15, 1958 and was repealed in 1959.   This testimony is corroborated by the answers to interrogatories propounded to Professor Ionascu, whose credentials as an expert are impeccable, states:  “ ‘It is true that the Facist Regime of Rumania had improved [sic], during the Second World War, certain restrictions as to the right of aliens to dispose of their properties, mentioned by the Decree nr. 169/1941.   But this regulating disposition has been abrogated by the Decree nr. 376 of October 5, 1959.’ ”

Petitioners rely to some degree on a letter addressed to their attorney from the American Legation in Bucharest stating that an investigation by the legation disclosed that United States citizens inheriting property in Rumania may dispose of their inheritances as they please, without restriction.   The letter, however, is in the present tense, relating the situation as of its date, October 10, 1963.

Appellants also rely on the Treaty of Peace between Rumania and the United States dated February 10, 1947.   Article 24 of that treaty provides:  “In so far as Rumania has not already done so, she shall restore all legal rights and interests in Rumania of the United Nations and their nationals as they existed on September 1, 1939.' ”   61 Stat. 1808.   Petitioners argue that this provisions effectively abrogates Act No. 169 as of the date of the treaty.   The language of the treaty, however, does not support this contention.   It says only that Rumania shall restore foreigners' rights in the future.   No time limit is set.   Moreover, even if the 1959 repeal of Act No. 169 was beyond any time period set or implied from the treaty, nothing is proven other than that Rumania violated the treaty in this respect.

Petitioners contend however, that Act 169, though remaining on the books, was considered a dead letter after Rumania entered into the treaty.   However, in 1949, two years after the date of the treaty, Act 169 was amended to transfer the regulatory power granted therein to the Department of Justice.   This demonstrates that the Rumanian government considered Act 169 vital and effective in spite of the Treaty of Peace.

Petitioners also argue that despite the language of Act 169, the Rumanian government has in practice allowed American citizens to inherit property, dispose of it, and receive the proceeds in the United States.   They present evidence of American citizens inheriting estates and in two instances show receipt of the cash proceeds of such inheritances in the United States.   Such evidence, however, is of limited probative value.   In the first place, there is no evidence that the transaction did not receive the prior approval of the Ministry of Justice.   Secondly, Mr. Crisan testified, and there is no evidence to the contrary, that Rumanian citizens remain such even though they become citizens of a foreign country.   If this be true, and we assume it is, then the recipients of these particular inheritances may have been treated not as foreigners, but as Rumanian nationals.   Finally, there is nothing to indicate that a fair rate of exchange was achieved by those actually receiving money in the United States.   Since there are no objective criteria which govern the actions of the Department of Justice, and in view of the logical gaps in the evidence, we cannot conclude that the Rumanian government has totally ignored the clear mandate of its own law.   Indeed, there is a presumption to the contrary.  (Estate of Kennedy, supra, 106 Cal.App.2d at p. 625, 235 P.2d at 837.)

 Finally, petitioners argue that even were we to give effect to Act 169, it is totally unrelated to the right to inherit.  Probate Code, § 259, they argue, requires only that American citizens be able to “take” real and personal property in the foreign country on the same terms and conditions as citizens of that country.   The statute does not refer to their ability to dispose of the property and receive the proceeds in this country.   It is to be noted, however, that the Probate Code refers to “reciprocal” rights of inheritance.   Such rights would be hollow indeed if the recipient of the property were unable to obtain the benefits of ownership.

“Thus, where the right of a citizen of the United States to receive a legacy from a foreign nation is conditioned upon obtaining the ‘approval’ of an agency of the foreign government and the granting of permission to receive such a legacy is not regulated by objective standards but is left to the unbounded discretion of the governmental agency, there is no ‘reciprocal right’ as that term is used in the Probate Code.”  (Estate of Gogabashvele, 195 Cal.App.2d 503, 508, 16 Cal.Rptr. 77, 80.)

As already pointed out, our Supreme Court has recently said in Larkin, 65 A.C. p. 54, 52 Cal.Rptr. p. 444, 416 P.2d p. 476:  “We would almost certainly not find the requisite reciprocity with respect to a country which permitted no inheritance at all, or which made the enforcement of inheritance rights subject to official whim or caprice.  * * * [W]e believe that it necessarily imports * * * that such rights are regularly recognized in practice.”

Further support for the proposition that the right to conditioned approval from an agency within a foreign government, which approval is based on no objective criteria, is a fatal defect, is found in Estate of Arbulich, 41 Cal.2d 86, 257 P.2d 433.   In that case, the court was confronted with a Yugoslavian “Foreign Exchange Law” which restricted the disposition and removal of property and money in much the same manner as Act 169.   The court said at pp. 96–97, 257 P.2d at pp. 439–440:

“Appellant urges that the ‘Foreign Exchange Law’ has no materiality in relation to the question of reciprocity;  that is is merely ‘regulatory of foreign exchange and has no reference whatever to rights of inheritance.’   But a reading of the entire substance of the documents mentioned makes it apparent that the trial court was justified in reaching the conclusion that under Yugoslav law a citizen of the United States, at the time of decedent's death, had no definitely ascertainable and enforceable right to receive Yugoslav property by testament, and that the receipt of any such property would depend in each case upon the largely, if not entirely, uncontrolled discretion of the Minister of Finance.   This is far different from a standardized regulation which might merely delay the transmission of gold, money, or other stores of value from one nation to another.  (See Estate of Schluttig (1950), supra, 36 Cal.2d 416, 425, 224 P.2d 695;  cf. Estate of Miller (1951), supra, 104 Cal.App.2d 1, 12, 13, 230 P.2d 667.)   Here is is pertinent to observe, as was declared in estate of Blak (1944), 65 Cal.App.2d 232, 238, 150 P.2d 567 [citation omitted]:  ‘The “right” to take property by inheritance and the “right to receive” that inheritance by payment in money have long been recognized as part of the substantive, legal and sanctioned incidents of the normal legal order of society.  * * * The “right” to receive the benefits of the inheritance is a necessary and inherent corollary to the “right” to take by inheritance.   One is not separable from the other.   The one includes the other.   If the right to take exists * * * the right to receive exists * * *.’ ”4 (Emphasis added.)

We are satisfied, therefore, that reciprocal rights of inheritance do not exist when the country in question regulates without objective criteria the right of foreign heirs to dispose of their inherited property and remove the property or proceeds to their native soil.

 Petitioners contend that Probate Code, § 259 is unconstitutional in that it denies to them the equal protection of the laws and due process under the Fourteenth Amendment of the United States Constitution and that it constitutes an unwarranted infringement on the powers of the Federal Government in the area of foreign relations.   In Clark v. Allen, 331 U.S. 503, 517, 67 S.Ct. 1431, 91 L.Ed. 1633;  Estate of Knutzen, 31 Cal.2d 573, 191 P.2d 747;  Estate of Bevilacqua, 31 Cal.2d 580, 582, 191 P.2d 752, these arguments are analyzed and rejected,  We agree with these cases.

The judgment is affirmed.

CONCURRING OPINION.

In concur in the judgment on the ground that petitioners have not sustained the burden of proof placed on them by Probate Code, section 259.1 to establish the existence of reciprocal rights of inheritance in 1958 between citizens of the United States and citizens of Rumania.

The Attorney General relies on the text of Rumanian Act No. 169, March 4, 1941 (Ministry of Justice, Civil Laws in Force, Official Texts with Amendments to Sept. 1, 1956.   Scientific Publishing House, Bucharest, 1956), which specifically restricted the rights of aliens to dispose of property in Rumania without advance consent of the Department of National Economy.   Act No. 169 was amended in 1949 to transfer the power to consent to the Ministry of Justice and was not abrogated until October 5, 1959.   Presumably during the period of its existence it accurately reflected the legal status of aliens in Rumania with respect to the disposition of property.

Petitioners claimed that Act No. 169 had been a dead letter since 1945, and if they had produced convincing proof that in practice the Act was ignored during those years I would agree with them.   However, no substantial proof to this effect was presented.   The proof before us did indicate that following the abrogation of Act No. 169 in 1959, the United States and Rumania executed an agreement in March 1960 settling financial questions between the two countries, and that from the time of that agreement funds have been regularly transferred between the two countries.   While this evidence might have sufficed to prove reciprocity during the post–1959 period, it was inadequate to establish the existence of a reciprocal right during the earlier period.

Hearing granted;  MOSK, J., not participating.

FOOTNOTES

1.   Probate Code, § 259:  “The right of aliens not residing within the United States or its territories to take real property in this State by succession or testamentary disposition, upon the same terms and conditions as residents and citizens of the United States is dependent in each case upon the existence of a reciprocal right upon the part of citizens of the United States to take real property upon the same terms and conditions as residents and citizens of the respective countries of which such aliens are residents and the right of aliens not residing in the United States or its territories to take personal property in this State by succession or testamentary disposition, upon the same terms and conditions as residents and citizens of the United States is dependent in each case upon the existence of a reciprocal right upon the part of citizens of the United States to take personal property upon the same terms and conditions as residents and citizens of the respective countries of which such aliens are residents.”

2.   We are mindful of the admonition in Estate of Larkin, 65 A.C. 49, 52 Cal.Rptr. 441, 416, P.2d 473, filed August 2, 1966, wherein our Supreme Court says:  “Whatever our reaction to the methods of the Soviet Union or to its policies, we must scrupulously confine ourselves to the issues raised by our statute and permit the resolution of questions of foreign policy to rest with the federal government.   To allow such considerations to flavor our decision would be to endanger the constitutionality of the statute and unduly to extend the province of this court.”

3.   The United States Treasury Department, Office of the General Counsel, in its “Preliminary Studies of Certain Financial Laws and Institutions, Rumania”, published in November 1944 lists this act as “Decree–Law no. 529”.   Its translation, while worded slightly differently, agrees essentially with Mr. Crisan's.   It does not include subparagraph 1 and 2 of Article I as does Mr. Crisan.

4.   See also Estate of Kennedy, supra, 106 Cal.App.2d at pp. 628, 629, 235 P.2d at p. 842, wherein the court distinguished prior decisions, stating:“This conclusion is not inconsistent with the decisions in Estate of Schluttig, 36 Cal.2d 416, 224 P.2d 695 [citation], and Estate of Miller, 104 Cal.App.2d 1, 230 P.2d 667 [citation].  In each of those cases there was in evidence a German law which could have been interpreted by the German courts as meaning that inheritance by nonresident aliens did not exist as a matter of right but was subject to the arbitrary discretion of Nazi administrators acting in accordance with Nazi ideology.”

ROTH, Presiding Justice.

HERNDON, J., concurs.

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