Order

The Fifth Civil Court of First Instance of Guatemala, by order of December 7, 2020, granted Lisa, S.A.'s revocatoria and rejected Cerro Colorado, S.A.'s ordinary lawsuit seeking extinctive prescription of dividend payment obligations. The court held that the ordinary process was improper for a commercial dispute between mercantile entities and that the correct venue was the summary process under Article 1039 of Guatemala's Commercial Code. This ruling constitutes a procedural victory for Lisa by blocking an action aimed at extinguishing by prescription the obligation to pay dividends corresponding to fiscal year 2013, as decreed by the annual ordinary shareholders' assembly of June 9, 2014.

Case Background

Cerro Colorado, S.A. filed an ordinary lawsuit for extinctive and liberatory prescription of the obligation to pay dividends to Lisa, S.A., alleging that more than five years had elapsed since the annual ordinary shareholders' assembly of June 9, 2014, which resolved to distribute profits from the period of January 1 through December 31, 2013. The complaint was admitted for processing by resolution of January 24, 2020. Lisa, S.A. filed a revocatoria against that admission, arguing that the ordinary process was improper and that the claim should proceed through the summary process under Article 1039 of the Commercial Code.

Court's Analysis

The court structured its analysis around three questions: the legal nature of the claim, whether the action fell within the scope of the Commercial Code, and the absence of an arbitration agreement.

Mercantile nature of the claim. The obligation whose prescription was sought, the payment of dividends to a shareholder, arose from a commercial activity conducted by a Guatemalan merchant on Guatemalan territory. The court cited Articles 134(3), 139, and 154 of the Commercial Code to establish that dividend distribution and the binding nature of shareholder assembly resolutions are governed by commercial law.

Applicable procedural route. Article 1039 of the Commercial Code provides that all actions arising from its application must be litigated through the summary process, absent an arbitration agreement. Since no document evidencing an arbitration clause was submitted, and the claim derived from obligations governed by the Commercial Code, the summary process was the proper venue.

Harm to Lisa's rights. The court concluded that the January 24, 2020 resolution, by admitting the complaint through the ordinary process, harmed the rights of Lisa, S.A.

Ruling

• Lisa, S.A.'s revocatoria against the January 24, 2020 resolution was granted
• Cerro Colorado, S.A.'s extinctive prescription complaint was rejected for processing, as the ordinary process was not the proper venue
• The plaintiff was directed to pursue the appropriate procedural route (summary process) to file its action

Legal Basis

• Article 12 of Guatemala's Constitution — right of defense and due process
• Article 1039 of the Commercial Code — mandatory summary process for actions arising from commercial law, absent an arbitration agreement
• Articles 134(3), 139, and 154 of the Commercial Code — dividend distribution, shareholder's right to request distribution, and binding nature of assembly resolutions
• Articles 1, 3, and 5 of the Commercial Code — applicability of the Commercial Code to merchants, commercial transactions, and commercial matters
• Article 599 of the Civil and Commercial Procedural Code — procedure for revocatoria

Signatories

• Sara Leticia Folgar Lemus de Pino, Judge
• Daris Carolina de Mata Medrano, Clerk

Subsequent Proceedings

Cerro Colorado, S.A. filed an amparo action before the Fifth Chamber of the Court of Appeals, Civil and Commercial Division, which was denied on April 20, 2021. Cerro Colorado appealed to the Constitutional Court, which in its decision of September 20, 2022 declared the appeal without merit and confirmed the rejection of the complaint, holding that the summary process was the correct venue under Article 1039 of the Commercial Code. The Court imposed a Q1,000.00 fine on Cerro Colorado's attorney.