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5. The Janus face

A strict application of the requirement that restitution of the property must be in kind, makes it impossible to create a usufruct on property such as money, wine or grain, consumed directly by its use, as it is impossible to restore something that is consumed by its use. The problem is comparable to the more extreme case of the usufruct of perishable property which eventually perishes on account of wear and tear (see section 4, above). The Romans perceived this as problematic because the original aim of the institution of usufruct was alimentary, namely to provide for the living expenses of a surviving spouse during her or his lifetime. Under the regime of Augustus, this was solved by a senatus consultum, introducing an ‘improper’ form of usufruct namely the quasi-usufruct.80 This form of usufruct is also recognised in France (FCC, art. 587), Germany (BGB, § 1067) and Belgium (BCC, art. 587). This kind of usufruct was also recognised by the Old Dutch Civil Code, but was abolished in the New Dutch Civil Code in 1992 (see section 6, below).

The quasi-usufruct regime, which is explicitly regulated by law, validates the reasoning underlying the modern approach to usufruct as explained in section 4, above. Here, again, the key is to re-define the obligation to restore the property in the light of the specific destination of the particular usufructuary assets.81 If the destination of the asset is to be consumed, then the restoration cannot relate to the substance of the specific assets and the obligation to preserve the substance of the asset is thus channeled towards preserving it in a way that is compatible with its destination. If its destination is to consume the asset, consumption is allowed, and the obligation of restoration in kind is replaced by restoration of an equivalent. According to FCC/BCC, art. 587, the usufructuary shall restore either goods of the same quantity and quality or their value as appraised at the time of restoration.82 The law is not clear regarding the precise extent of the restoration which is interpreted differently in Belgian83 and French law.84

The ordinary rules of usufruct are also applicable to quasi-usufruct.85 Goods that are immediately consumable are intended to make a swift

80 D.7.5.5; D.7.5.7. 81 Verbeke, ‘Modaliteiten’, p. 171.

82Kluyskens, Beginselen, Zakenrecht, p. 182.

83Derine, Vanneste and Vandenberghe, Zakenrecht, p. 359.

84Veaux-Fournerie, ‘Usufruit, caracte`res et sources’.

85Verbeke and Vanhove, ‘Spelen met vruchtgebruik’, p. 203.

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exit from the nude owner’s patrimony.86 Even so, the destination indicated by the nature of the usufructuary object is not the only criterion. It was mentioned that the destination can also be indicated specifically by the donor/nude owner. Admittedly, in most cases, this corresponds to the natural destination of the property, but it need not always be the case. For example, money is in principle consumable. However, the ancient Roman coin in the collection of a numismatist is, according to the destination given by its owner, not consumable.87 On the other hand, a Picasso painting is in principle not consumable. If this painting is, however, a mere investment and destined to be sold immediately to a high bidder, one can argue that it is a consumable asset.

Moreover, one may contractually agree on the consumable character of property.88 Parties may, for instance, reach an explicit agreement that certain property is burdened with a quasi-usufruct, regardless of its inconsumable nature and destination.89 Furthermore, this can also be inferred from the deed creating the usufruct.90 The Belgian Minister of Justice is of the opinion that a conventional quasi-usufruct is valid. According to BCC, art. 579, usufruct is established by law or by a person’s wish. BCC, art. 587 (quasi-usufruct) is not an exception to this rule.91 Any property, even immovable property, can lose its natural character and degenerate, by agreement, into consumable property.92

Reserving a quasi-usufruct on the assets donated grants elaborate powers of control to the donor-usufructuary. Regarding fruits and income, the situation is no different from under the modern approach, as explained in section 4, above.

Since the donor-usufructuary is under no obligation to restore the asset itself, but merely an equivalent, he/she can behave like a quasiowner during the usufruct period. The ‘quasi’ element is explained by the fact that the donor-usufructuary is bound to manage the property in accordance with its destination or intended purpose, since he/she has

86 Grimaldi, ‘L’emploi’, pp. 494–6. 87 Verbeke, ‘Creatief met vruchtgebruik’, p. 552.

88de Page, ‘Le Quasi-usufruit’, p. 157; Grimaldi, ‘L’emploi’, pp. 493–6; Verbeke, ‘Quasivruchtgebruik’, p. 50.

89Dekkers and Dirix, Handboek, p. 186; de Page, Traite« e«le«mentaire, p. 368; Nudelholc and Karadsheh, ‘Re´flexions’, p. 409.

90Derine, Vanneste and Vandenberghe, Zakenrecht, p. 358.

91Vragen en antwoorden, Kamer, 2001–2. Answer 16 Oct. 2001 to question no. 356, 10983.

92Baudry-Lacantinerie, Pre«cis de droit civil, pp. 789–90; Verbeke, ‘Quasi-vruchtge bruik’, p. 51.

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an obligation to restore the usufructuary property.93 The ‘owner’ element is also present since he/she can perform all acts of alienation and disposition without the consent of the nude owner, in so far as these acts are in accordance with the destination of the property. The destination is consumption, and consumption implies alienation.94 Theoretically, the donor-usufructuary has no more powers than a normal usufructuary: all his/her actions must respect the destination of the assets. Realistically however, the donor-usufructuary has significant powers because the destination of the assets is consumption and he/ she is only obliged to restore an equivalent.95

There has been some dispute with regard to the validity of a donation with reservation of a quasi-usufruct under French and Belgian law. Opponents take the view that such reservation is incompatible with the irrevocability of the donation (FCC/BCC, art. 894 and BCC/ FCC, art. 946) and the consequent conflict with the principle ‘donner et retenir ne vaut’.96 Another view is that in such a case there is no transfer of ownership in favour of the donee.97 The majority opinion, however, correctly accepts its validity, pointing out that a reservation of quasi-usufruct does not bestow on the donor the freedom to revoke the donation and is thus in line with the irrevocability requirement of FCC/BCC, art. 946. The usufruct, and not the right of alienation and disposal, is reserved by the donor.98 These rights are inherent in a quasi-usufruct but not in an absolute sense. He/she is still bound to restore the property at the end of the term of the usufruct. Moreover, FCC/BCC, art. 949 allows the reservation of any usufruct by the donor without making a difference between the various forms a usufruct can take.99

In conclusion, it is quite clear that the institution of quasi-usufruct is very attractive from an estate planning perspective. The control which the usufructuary can exercise comes very close to that of a quasi-owner.

93Grimaldi, ‘L’emploi’, pp. 494–6 and the references; Verbeke, ‘Creatief met vruchtgebruik’, p. 551. The owner is merely an ordinary creditor. He has no real claim against the usufructuary (Derine, Vanneste and Vandenberghe, Zakenrecht, p. 359).

94Baudry-Lacantinerie, Pre«cis de droit civil, p. 790; Brault ‘Un convention’, p. 3; Verbeke, ‘Schenking met voorbehoud vruchtgebruik’, p. 265.

95Verbeke, ‘Quasi-vruchtgebruik’, p. 42.

96Chappert, ‘La Donation’, pp. 907–8; de Wulf, ‘Schenking roerend goed’, p. 164.

97Sagaert, ‘Oude zakenrechtelijke figuren’, p. 235.

98de Page, ‘Les Donations’, p. 140; Grimaldi, ‘La Donation’, p. 12; van Laere, ‘De civielen fiscaalrechterlijke grenzen van schenking’, p. 197.

99van Laere, ‘De civielen fiscaalrechterlijke grenzen van schenking’, p. 197.