When a person is deceased in Korea, the inheritance comes to fruition immediately. The Korean inheritance law provides who shall become the inheritor and beneficiary of the property of a deceased person, i.e. estate. This, however, does not always mean the inheritor shall be given all the property of the decedent. There are separate rules and restrictions of the distribution of the estate in Korea.
The basic rule of the Korean inheritance law is that the property of a deceased person is distributed according to his or her will. So, a person who is not categorised as a person who can be an inheritor by law can be a beneficiary of the property by the decedent’s will. What if there is no valid will? The Korean inheritance law sets forth the rule of intestate succession. This rule of intestate succession names the beneficiary and the shares of each beneficiary for a distribution. The intestate succession rule provides that persons become beneficiaries in the following order:
- Direct descendants (children or grandchildren)
- Direct ascendants (parents or grandparents)
- Relative within the 4th degree of collateral consanguinity
If there are multiple persons standing in the same rank, the closest in degree of relationship shall have the priority. And if there are multiple persons in the same rank and same degree of relationship, they become co-inheritors and co-beneficiaries. The shares of the co-beneficiaries are all equal.
The spouse has a unique position here. If there are no relatives in the first and second rank, the spouse shall become the sole inheritor. If there is any inheritor(s) in the first or second rank, the spouse shall become the co-inheritor with that inheritor(s). As to the intestate succession share, the Korean law provides more protection to the spouse. According to the Korean intestate succession rule, the spouse shall have 50% more share than those of other co-inheritors. For example, if a deceased person leaves a spouse, 2 children and his parents, the 2 children and the spouse shall become the co-inheritor with each child having 2/7 of the estate and the surviving spouse having 3/7 of the estate.
As mentioned earlier, this rule of intestate succession only applies when there is no valid will of decedent. Does this mean the decedent can dispose the estate freely by his own will? The answer is not always. The Korean inheritance law recognizes a reserved share, i.e. statutory minimum share of the succession which is obliged to go to an inheritor. This means any inheritor is able to claim an inheritance despite what the decedent have written into the will . By this statutory reserved share, the decedent’s freedom to making a will is restricted. Currently, the reserved share under Korean inheritance law is 50% of the share of an estate which an inheritor would have received in the case of intestate succession. So, in the above example, even if the deceased person made a will which names his friend as the sole beneficiary, each child is still entitled to 1/7 of the estate, and the spouse is entitled to 3/14 of the estate.
Most of inheritance disputes in Korea center on executing or contesting the will and enforcing the reserved share. We have seen many cases where Korean-based family of the deceased person requests the non-Korean family to sign a certain legal document to handle the succession process in Korea, not fully disclosing the situation of the estate and even providing false information about the law and practice. This could harm the transparency of the whole process of distribution and cause a financial loss to the foreign party who is lack of sufficient and reliable information on the Korean inheritance law. Inheritance law is a complicated area of law in Korea. Thus, It is a good idea to seek legal advice from a Korean licensed attorney before you take any legal action.
© 2015 Wonil Chung, Korean Licensed Lawyer. All rights reserved.