The notary does not hold the funds out of excessive caution. He retains them because legal checks condition their release, and any negligence would engage his personal liability. Understanding the mechanisms of this blockage allows for anticipating delays and, in some cases, speeding up the process.
Movable property appraisal and tax inventory: an unknown lock since 2022
The 2022 reform transferred the competence of the movable property appraisal enforceable against the tax authorities to the judicial commissioner. The inventory carried out by the notary no longer has automatic probative force with respect to the tax administration.
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Direct consequence: as long as the judicial commissioner has not established the compliant inventory, the notary cannot finalize the inheritance declaration. The funds remain in the office’s account, not due to inertia, but due to the legal impossibility of closing the file.
We observe that this reform significantly lengthens the timelines in inheritances involving valuable movable property (collections, vehicles, works of art). The blocking of funds by the notary then results from dependence on a professional third party whose availability is not under the notary’s control.
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Unregistered quasi-usufruct agreement: the inheritance trap that blocks funds
The ruling of the Court of Cassation on November 27, 2024 (Cass. com., n° 23-12.151) has tightened the requirements for quasi-usufruct agreements. For the restitution claim to be deductible from the estate liabilities, the agreement must be notarized or registered.
An unregistered private deed exposes the estate to a refusal of deduction of liabilities by the administration. The additional tax burden can be considerable. Faced with this risk, the notary retains the funds while awaiting regularization or a tax ruling.
This blockage only appears at the time of settlement. Neither the heirs nor the previous advisor necessarily anticipated the problem. The notary then finds himself in a defensive position: unlocking the funds without security would expose him to liability if the administration corrects the declaration.
Blocking of funds in real estate sales: land formalities and mortgage release
In terms of sales, the notary collects the price in a dedicated escrow account. The release of funds to the seller is subject to several operations that do not all depend on the notary’s office.
- The publication of the deed at the Land Registration Service can take several weeks. Without this formality, the transfer of ownership is not enforceable against third parties, and the notary cannot close the file.
- The release of mortgage registrations requires obtaining an up-to-date mortgage status, followed by the release from registered creditors. A creditor slow to respond is enough to delay the entire process.
- The payment of taxes (transfer duties, real estate security contribution) constitutes a prior obligation. The notary deducts these amounts before any payment to the seller.
- In the presence of a bridge loan or bank financing, the late receipt of funds by the lending institution mechanically delays the signing and thus the release.
The seller receives the net balance once all these operations are completed. The usual timeframe is counted in weeks after the signing of the authentic deed, but a file with a mortgage to be released or land dispute can exceed several months.
Escrow of the sales agreement: when the deposit remains immobilized
The deposit paid for the agreement (often called escrow) is held by the notary or in a dedicated account. These funds can only be released upon signing the final deed or, in the case of withdrawal within the legal timeframe, returned to the buyer.
The blockage occurs when the sale fails outside the withdrawal period and the parties do not agree on the fate of the escrow. The notary then has no power to decide on the allocation: he retains the amount until an amicable agreement or judicial decision.
We recommend drafting a precise escrow clause in the agreement, detailing the conditions for restitution and cases of nullity. A vague drafting turns a guarantee mechanism into a source of disputes.
Inheritance and disagreement among heirs: funds blocked in the notary’s account
In the context of an inheritance, the funds remain held by the notary as long as the distribution is not validated by all the heirs or by a judgment.
The most frequent blockage situations:
- An heir refuses to sign the sharing deed, paralyzing the procedure for all others.
- A will is contested before the judicial court, which suspends the inheritance settlement.
- Debts of the deceased must be verified and settled before any distribution, which sometimes requires lengthy inquiries with creditors.
- The absence of response from an heir (unexercised inheritance option) prevents the notary from finalizing the succession.
The notary places the funds in a secured escrow account. He cannot invest them or use them for purposes other than settling debts and inheritance costs. In the event of prolonged inertia from an heir, the other co-heirs can bring the matter to court to obtain a judicial partition, but the procedure adds months to the overall timeline.
The notarial blockage is never discretionary. Each situation of fund retention corresponds to a legal obligation, an ongoing administrative formality, or a disagreement between parties that the notary is not qualified to resolve alone. Precisely identifying the cause of the blockage remains the only way to act: regularize an agreement, follow up with a judicial commissioner, obtain a mortgage release, or initiate a judicial partition procedure.