succession

Movable or Immovable? The Hidden Classification That Determines Your Estate

Published: 14 April 2026

Movable or Immovable? The Hidden Classification That Determines Your Estate

Before any question of succession, taxation, or jurisdiction can be resolved in a cross-border context, a prior question must be answered: is the asset a movable or an immovable? This classification — which may seem academic — is in practice the single most consequential determination in international estate planning. It decides which country's law governs the asset, which court has jurisdiction over disputes, and which succession regime (including forced heirship) applies. A misclassification can redirect an entire estate from the testator's intended beneficiaries to individuals the testator never envisaged.

The Doctrinal Foundation: Dicey Rule 135

The principle is stated in Dicey, Morris & Collins on the Conflict of Laws (15th Edition) as Rule 135:

"The law of a country where a thing is situate (lex situs) determines whether: (1) the thing itself is to be considered an immovable or a movable; or (2) any right, obligation, or document connected with the thing is to be considered an interest in an immovable or in a movable."

This rule is absolute. The classification is not made by the law of the deceased's domicile, the law chosen in the will, or the law of the testator's nationality. It is made exclusively by the law of the country where the asset is situated at the relevant time. For succession, the decisive moment is the date of death (23-009).

The rationale is pragmatic: only the lex situs has effective control over property within its territory. Italy decides what is immovable in Italy. England decides what is immovable in England. Neither country can impose its classification on the other.

The Realty/Personalty Trap

English domestic law uses a technical distinction between realty (interests in land) and personalty (everything else). This distinction does not apply in the conflict of laws. The international system uses the universal distinction between movables and immovables — a distinction that all legal systems recognise, even if they define it differently (23-004).

The danger arises when English practitioners assume that the domestic realty/personalty classification applies internationally. It does not. Several categories of property that are classified as "personalty" under English domestic law are treated as immovables in the conflict of laws:

Leaseholds

Under English domestic law, a leasehold interest in land is classified as personalty — a chattel real. This classification is a historical artefact of the common law's treatment of terms of years.

In the conflict of laws, a leasehold is classified as an immovable (Freke v Carbery (1873) L.R. 16 Eq. 461). The practical consequence is significant: if a deceased person held a 99-year leasehold on an Italian apartment, that leasehold is subject to the Italian law of succession for immovables. If no choice of law has been made under Brussels IV, the lease falls under Italian forced heirship.

An English solicitor who treats the Italian leasehold as "personalty" and plans the estate accordingly will produce a plan that is legally defective.

Land Held on Trust for Sale

Under the English equitable doctrine of conversion, an interest in land held on trust for sale was historically "converted" from real property into personal property — the beneficiary was treated as having an interest in the proceeds of sale, not in the land itself.

In the conflict of laws, this conversion does not occur. An interest in land held on trust for sale remains an immovable for conflict purposes. This was established in Re Berchtold [1923] 1 Ch. 192, where the English court held that Hungarian land held on trust for sale remained an immovable governed by Hungarian law, not English law.

The practical consequence: if a trust governed by English law holds Italian real estate, the Italian property is classified as an immovable for all conflict-of-laws purposes, regardless of whether the English trust deed contemplates a future sale. Italian law — not English law — governs questions of succession, formalities of transfer, and capacity.

Mortgagee's Interest in Land

A mortgagee's interest in land in England is treated as an interest in an immovable in the conflict of laws (Re Hoyles [1911] 1 Ch. 179). If an Italian bank holds a mortgage over English property, that mortgage interest is governed by English law as the lex situs. Conversely, if an English lender holds a mortgage over Italian property, the mortgage interest is governed by Italian law.

Determining the Situs: Where Is the Asset?

Once the movable/immovable classification is made, the situs of the asset must be determined. This is governed by Dicey Rule 136, which establishes a precise framework:

Land and Buildings

Land is situated where it lies. This is self-evident. Italian real estate is situated in Italy. There is no complexity here.

Bank Accounts

A bank account is situated at the branch where the account is kept (Joachimson v Swiss Bank Corporation [1921] 3 K.B. 110). The consequence: an account at Barclays in London is situated in England. An account at Banca Intesa in Milan is situated in Italy. An account at HSBC in Jersey is situated in Jersey.

This matters because the situs determines which jurisdiction's succession law applies to the account, which court has jurisdiction over disputes concerning the account, and which authority has the power to freeze or release the funds during probate.

The multi-branch trap: A client with accounts at the same bank in both London and Milan holds assets in two jurisdictions. Each account is governed by the law of its own situs.

Shares in Companies

Shares are situated where they can be effectively dealt with as between the owner and the company — usually the location of the share register (Brassard v Smith [1925] AC 371).

For Italian companies: Shares in an S.r.l. (Società a Responsabilità Limitata): the share register is maintained at the Camera di Commercio (Chamber of Commerce) where the company is registered. These shares are situated in Italy. Shares in an S.p.A. (Società per Azioni): if the shares are in dematerialised form (as is standard for listed companies), they are held through the central depository (Monte Titoli). The situs is generally Italy.

For English companies: Shares in a UK limited company are situated in England if the share register is maintained in England.

Debts and Receivables

A debt is generally situated where the debtor resides (23-026). An amount owed by an Italian individual or company is situated in Italy, regardless of where the creditor is based. This classification affects garnishment, assignment, and inheritance of debts.

Negotiable Instruments

Negotiable instruments (cheques, bills of exchange, promissory notes) are situated where the physical instrument is located (23-034). This is a movable classification — the instrument follows the paper.

Cryptocurrency and Digital Assets

This is a rapidly developing area. The emerging English authority in Ion Science Ltd v Persons Unknown [2020] suggests that the situs of cryptocurrency is the domicile or habitual residence of the owner, since the owner exercises control through encryption keys held in their possession, wherever they happen to be. This is a provisional view and may evolve. For estate planning purposes, clients holding significant cryptocurrency balances should be advised that the governing law is uncertain and that explicit testamentary provisions are essential.

Ships and Aircraft

Ships and aircraft are generally situated where they are physically located (23-057, 23-061), but registration may provide an "artificial situs" if the vessel is on the high seas or in non-sovereign territory. An Italian-flagged yacht in international waters may be treated as situated in Italy by reference to its port of registration.

The Complete Classification Table

The following table maps common asset types to their situs, classification, and the resulting governing law for succession:

Why This Classification Matters: Three Worked Examples

Example 1: The Leasehold That Triggered Forced Heirship

A UK national holds a 99-year diritto di superficie (surface right — functionally equivalent to a leasehold) over an apartment in Rome. They die without making a Brussels IV choice of law. Their English solicitor, treating the interest as "personalty" (as it would be under English domestic law), distributes it to the surviving spouse under the terms of the English will.

The solicitor is wrong. In the conflict of laws, a leasehold interest in Italian land is an immovable. Italian law governs its succession. The children of the deceased are entitled to invoke their mandatory shares under the legittima. The surviving spouse may find themselves compelled to share the apartment with the children, or to pay a financial settlement to preserve sole occupancy.

Example 2: The Trust for Sale That Remained Immovable

A UK-resident settlor creates an English-law discretionary trust holding a portfolio of Italian properties. The trust deed provides that the properties should be sold at the trustee's discretion and the proceeds distributed. The settlor dies. The trust's English solicitors assume that because the properties are held "for sale," the beneficiaries' interests are interests in the proceeds (movable personalty), governed by English law.

Under Re Berchtold, this assumption is incorrect. The Italian properties remain immovables for conflict-of-laws purposes until they are actually sold. Until that point, Italian law governs all questions of succession, the mandatory rules of the Italian legittima apply, and the Italian forced heirship provisions override the discretionary powers of the English trustee to the extent required by Article 15 of the Hague Trusts Convention.

Example 3: The Bank Account at the Wrong Branch

A UK national residing in Italy maintains two accounts at HSBC — one at the London branch and one at the Milan branch. They die domiciled in Italy. The estate planner assumes both accounts are governed by a single law.

They are not. The London account is situated in England (movable, governed by the law of the deceased's domicile — Italy, under the lex domicilii rule for movable succession). The Milan account is situated in Italy (movable, also governed by Italian law as the law of habitual residence under Brussels IV). In this particular case, both are governed by Italian law, but the administrative procedure differs: the London account requires an English Grant of Representation; the Milan account is released under the Italian Dichiarazione di Successione.

If the deceased maintained a client at a Jersey branch, that account is situated in Jersey — potentially governed by a different succession law entirely, depending on the deceased's domicile.

The Decisive Moment: Death, Not Planning

A final critical point: the classification of property as movable or immovable is determined at the moment of death (23-009). This means that estate plans constructed during the testator's lifetime may become defective if the character of the asset changes before death.

If a testator sells Italian land and places the proceeds in an English bank account, the asset has moved from "Italian immovable" to "English movable" — a wholly different succession regime applies. Conversely, if liquid funds are used to purchase Italian land, an asset that was previously governed by the law of the deceased's domicile is now governed by the Italian lex situs.

Estate plans must therefore be reviewed whenever the asset portfolio undergoes material change, to ensure that the classification and governing law analysis remains correct.

Professional Legal Considerations

The movable/immovable classification is the foundational analysis that precedes every other question in cross-border estate planning. A will that makes a Brussels IV choice of law is effective only against assets whose governing law can be displaced by such a choice. An estate plan that assumes English succession law will apply globally is defective if it fails to account for Italian immovables governed by the lex situs.

Practitioners should conduct a comprehensive asset classification audit at the earliest stage of any cross-border planning engagement. This audit should map each asset to its situs, classify it as movable or immovable under the lex situs, and identify the governing succession law. Only once this audit is complete can a valid testamentary strategy be constructed.

Where the classification produces an unexpected result — such as a leasehold classified as immovable, or trust property that remains immovable despite a trust-for-sale clause — specific planning interventions are required to ensure that the testator's intentions are not defeated by the conflict of laws.

Ask the Succession Desk about Asset Classification

Authority Notes

The movable/immovable classification is stated as Rule 135 in Dicey, Morris & Collins on the Conflict of Laws (15th Edition), Chapter 23. The Italian PIL confirmation is found in Article 51 of Law 218/1995, which provides that in rem rights over movable and immovable property are governed by the lex situs. This means the Italian and English systems converge: both assign the classification exclusively to the law where the asset is situated. The situs rules are stated as Rule 136. Key authorities include Freke v Carbery (1873) (leaseholds as immovables), Re Berchtold [1923] 1 Ch. 192 (trust for sale property remains immovable), Re Hoyles [1911] 1 Ch. 179 (mortgagee's interest as immovable), Joachimson v Swiss Bank Corp [1921] 3 K.B. 110 (bank account situs), Brassard v Smith [1925] AC 371 (share situs), and Ion Science Ltd v Persons Unknown [2020] (cryptocurrency situs).

[!TIP] Authoritative Links: For more on the succession rules that apply once classification is complete, see our note on Forced Heirship in Italy 2026 or Brussels IV and Succession in Italy 2026.

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