Death is never an easy subject to address, especially when it is sudden and tragic. Similarly, determining how the deceased's assets will be distributed also requires an effort that the parties involved are often unprepared for.

In many cases, the deceased family member tends not to leave any eventual division of assets already organized. As a result, the heirs are faced with the need to cover part of the costs out of their own pockets. 

Given the high operational costs of probate, heirs question whether the estate itself can afford the expenses. This can be achieved through the sale of movable and immovable property to settle liabilities.

The sale of a property that is part of an estate inventory frequently raises questions among heirs and interested parties. Although it is possible to sell real estate during the inventory process, this operation requires specific legal requirements and procedures. These requirements aim to safeguard the rights of all parties involved.

What is an inventory?

Probate is the legal procedure for identifying, evaluating, and distributing the assets, rights, and obligations of a deceased person. The division of assets takes place among heirs and successors. This process can be judicial or extrajudicial. The method depends on the existence of a will, the presence of minor or incapacitated heirs, and the consensus among the heirs.

In short, after death, the collection of assets and liabilities becomes known as the "estate." This estate is the core of the probate process. It is structured to settle as many debts as possible. If any assets remain, they are divided among the heirs.

As established by the Civil Code, " From the signing of the agreement until the approval of the division of assets, the administration of the estate will be carried out by the executor ."

The executor acts as the estate manager. They are responsible for listing the assets and liabilities, as well as settling debts, liquidating and distributing the assets.

However, in many cases, the deceased does not leave sufficient net worth to settle any debts. Faced with this situation, the heirs can resort to three solutions:

• (i) one or more heirs pay off the debts and receive a larger percentage as compensation.
• (ii) the heirs divide the debts among themselves and maintain the ordinary distribution of assets.
• (iii) the heirs sell off the deceased’s assets in order to raise the necessary funds to pay off the debts and, in the future, divide the remaining assets.

This article focuses on the latter hypothesis, so, within a thematic scope, we will examine the sale of real estate.

Sale of Property During Probate

Initially, it is important to emphasize that the sale of a property during probate is legally permitted. However, for this procedure to comply with legal requirements, certain conditions must be observed and met:

1. Unanimous Agreement of the HeirsAll heirs and the surviving spouse or partner must expressly consent to the sale of the property. Lack of unanimity may invalidate the transaction.

The agreement of the heirs is essential in extrajudicial probate, but it can be waived in judicial probate. If there is unjustified disagreement, the judge may authorize the sale of the property.

2. Judicial or Extrajudicial Authorization:
   • Judicial InventoryTraditionally, the sale of estate assets during probate proceedings required obtaining a court order, with a plausible justification, such as the need to settle the deceased's debts or cover probate expenses.
     
   • Extrajudicial InventoryPrior to Resolution No. 571/2024 of the National Council of Justice (CNJ), heirs had to seek judicial authorization to sell assets, even when carrying out the probate process through extrajudicial means.

With the publication of Resolution No. 571/2024 of the National Council of Justice (CNJ), it became possible to sell estate properties directly at a notary's office, without the need for judicial authorization, provided that the legal requirements are met, such as the unanimous agreement of the heirs and the allocation of the proceeds to pay the expenses of the probate proceedings.

3. Purpose of the SaleThe sale must have a valid justification, usually to cover probate expenses, settle debts left by the deceased, or prevent depreciation of the asset. The intended use of the proceeds from the sale must be clearly defined and agreed upon by the heirs. 
4. Tax RegularizationIt is essential that all taxes levied on the property, such as the Inheritance and Gift Tax (ITCMD), are fully paid before the division of assets. Furthermore, the tax obligations arising from the sale itself must be observed.

Want to understand more about this topic? Check out these complete articles:

• The role of the lawyer in probate proceedings: How to conduct the process effectively.z
• Extrajudicial inventory: how it's done and who can do it.r?

Procedures for the Sale

In a judicial inventory , the executor, responsible for administering the estate, must petition the judge requesting authorization for the sale, presenting the heirs' agreement and justifying the need for the sale. The judge will evaluate the request and, if deemed appropriate, will issue the authorization for the sale.

In the case of extrajudicial probate , Resolution No. 571/2024 of the CNJ (National Council of Justice) allows for the sale directly at the notary's office, through a public deed, provided that the requirements of the last chapter are met. The authorization must be express and accompanied by the appointment of the executor.

Necessary Care

In the sale of high-value goods, certain precautions are essential to ensure greater legal security for the transaction. 

The first step is to appraise the property, determining its true market value. This ensures that the sale is fair and equitable for all heirs.

Furthermore, the legal and notary risks of a real estate purchase and sale transaction are clear, so having the support of a lawyer specializing in inheritance law is essential to guide the heirs on legal procedures, prepare the necessary documents, and ensure that the transaction complies with current legislation.

Finally, it is of utmost importance to maintain clear and transparent communication between the heirs to avoid misunderstandings and ensure that everyone is aware of and agrees to the terms of the sale.

Advantages of Selling During Inventory

Selling an asset during the probate process can ensure a faster completion of the procedure, as it can provide financial resources to cover probate expenses, enabling a quicker conclusion to the process.

Furthermore, selling the property can be a strategy to avoid depreciation or high maintenance costs, preserving the value of the assets to be divided.

Possible Disadvantages

The potential disadvantages lie in the possibility of conflicts between heirs, since a lack of consensus can generate family friction, delaying the probate process and, consequently, the sale of the property. Any disagreement arising from an extrajudicial probate process has the power to convert it into a contentious judicial probate. 

Final Words

The sale of real estate during probate is a possibility foreseen in Brazilian law, which can bring benefits such as obtaining resources to pay expenses and speeding up the division of assets. However, it is essential to rigorously observe all legal procedures, ensuring the validity of the transaction and the protection of the rights of all heirs.

The recent CNJ Resolution No. 571/2024 has brought greater flexibility by allowing the sale of estate assets directly at the notary's office, without the need for judicial authorization, provided that the legal requirements are met. This change aims to streamline the probate process and ensure greater efficiency for the parties involved. Even so, hiring specialized legal counsel is essential to avoid errors or procedural defects.

In short, although the sale of a property under probate is feasible, the process requires caution, planning, and compliance with legal requirements. Agreement among the heirs, tax regularization, and, in certain cases, judicial authorization are essential elements for the transaction to occur in a valid and transparent manner. 

In extrajudicial probate proceedings, the process can be faster, but it requires consensus among the heirs. Furthermore, it is essential to inform the buyer about the legal status of the property and the steps for its regularization, ensuring security in the transaction.

Finally, selling a property during probate is a valid and often necessary alternative, especially when the assets need to be converted into resources to settle debts or legal expenses. With proper legal counsel, open communication between the heirs, and adequate tax planning, it is possible to successfully complete the sale, ensuring the satisfaction of the parties and compliance with the law.