Appeal Ruling: Appeals court upheld dismissal in dividend case by Las Margaritas

On November 4, 2024, the First Chamber of the Civil and Commercial Court of Appeals partially upheld the lower court’s ruling rejecting the claim by Avícola Las Margaritas, S.A. to extinguish dividend obligations owed to Lisa, S.A. The appellate court reaffirmed that Avícola Las Margaritas failed to prove when the dividends became legally enforceable, a key condition for triggering the five-year prescription period under Guatemalan civil law. The court emphasized that the act authorizing the dividend did not specify a payment date, leaving the matter at the discretion of the company’s board of directors.

The court found that the factual inconsistencies in the plaintiff’s account, along with the failure to establish the enforceability of the debt, were sufficient to uphold the denial. Lisa’s counterarguments were accepted, and the request for costs was waived due to partial merit found in the appeal.