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My husband and I had a corporation formed using a lawyer who delayed and delayed and made mistakes in the paperwork. We bought a house but had to buy it outside the corporation, because the s.a. wasn’t ready. I recently read the papers that were filed in the registro and realized that he had changed them. What we signed gave general power of attorney to me and my husband as president and secretary. He crossed out secretary and wrote treasurer (a unknown tico he had named) and in his notarial notes wrote that yes, he intended to make this correction. So now I, as president and the treasurer have full powers-my husband doesn’t. This is an outrage. To complicate matters further, he wrote in his extract in bold that the president and secretary (yes, secretary) have full powers. I don’t know if he is just a complete incompetent or about to do something fraudulent in the name of the corp. The atty does not know that I know what he did. He refuses to give us the books – just smiles and says he keeps the books. I only have phone numbers for him and his address on the docs show an address that he moved from many months ago. He moved from Golfito and now works in San Jose. How can I get the books, change attorneys, change the powers back and prevent him and/or the treasurer from performing any fraudulent acts in the corp.’s name. There is an address indicated for the treasuer, but no p.o. box; the usual 100 metros from the old pulperia type address. Will mail get there? As an non-resident (and not being able to move permanently for another 5 years) I could only get electricity in the corp.’s name. Ice initially refused to put service in the corp.’s name but the lawyer had the clerk call the offices in San Jose and argued successfully with them. But no problem to give it to our caretaker. So if we decide to dissolve the corp. we will lose our corp. status and may have another problem with ice. I email my attorney and call him and he is charming and promises to do certain things, but he doesn’t. So much time and money has been spent over and over again for the same things. Any advice? Know any lawyer willing to straighten this out?
Thanks.If you don’t have the property in the corporation name, then I would move on and start another corporation to place the property into…
With the slow court system in Costa Rica, it could be a very long time and a lot of money to persue the vagrant abagado.
Cut your loses and find another lawyer to get a new corporation.
Read this article from AMCostaRica about corporations:
A clever clause can dodge the probate mess
By Garland M. Baker
Special to A.M. Costa RicaNow there is a new way to duck messy probate in Costa Rica.
Thanks to an avid reader with a ton of patience, a limited liability company called an S.R.L. in Costa Rica, is now even a better vehicle for holding assets and succession planning. Most professional people do not know this secret.
Limited Liability companies are great for holding properties and manging businesses, but if there is only one manager and the manger is taken by death, a long legal struggle can take place.
If there are multiple managers, the liability company runs the risk of internal confusion and sometimes theft.
Technically, S.R.L. stands for Sociedad de Responsiblidad Limitada in Spanish. An S.R.L. is equivalent to an L.L.C., which stands for limited liability company in other parts of the world.
Two or more people form the business structure and hold shares in the organization. One person usually manages the company, but there can be more than one, many in fact. There is no limit to the number of managers a limited liability company can have.
As flexible as a limited liability company is, if there is only one manager, his or her absence, as in death, would freeze everything in the company until there was a shareholders meeting. In many cases the manager is the majority shareholder further complicating matters.
If the limited liability company has more than one manager, too many bosses tend to mess things up as a rule. More importantly, one of the managers could go wild and sell off all the assets of others. It happens.
In succession planning, some parents make their offspring managers and create the same problem. The kids go nuts and sell off all the assets of the parents.
Now it is possible to make the second and subsequent managers’ positions conditional based on succession.
The secret is simple but it took the Registro Nacional more than three months to approve the language. It goes this way:
In the constitution of the limited liability company in the clause outlining management there are two parts. One is listing the managers and the other is outlining their powers in the company.
One seeking to use this trick should list all the managers in this section giving them all the same power to manage the business affairs of the entity. However, after this is written, at the end of the clause, one should add a section stating that if the first manager is not available or incapacitated that is when the second manager can take the place of the first not before. The same can be true for a third manager. If the second is unavailable, the third can take the place of the second.
Actually, the end of the clause on managers can be flexible. Another option would be to have manager two and three act jointly in the absence of the first.
In the clause, it is important not to mention death. The Registro Nacional at one time accepted the word death as part of the clause but will no longer do so. That’s why it rejected the setup of a limited liability company for the avid reader, who wanted to pass on assets to a third party in case of death. Fortunately, the reader was able to wait three months while this new concept of managerial sucession got approved by the technicians at the Registro.
The essence of the legal language is to substitute not replace someone in the management position. However, this works perfectly in the case of death avoiding probate in the same step.
For example, Pete has a property in Costa Rica and puts it in an limited liability company making himself the manager. Pete with foresight makes his son Pete Jr. a manager in his permanent absence or disability.
Pete dies. Pete Jr., as manager, can move any assets in the limited liability company to another one that he controls and does not have to go through probate to do so.
Probate is a thing to avoid in Costa Rica, much like it is in other parts of the world. Usually, it is a long road filled with legal potholes. Big ones.
It is possible to setup sociedad anonimas or S.A.s, a legal structure like a corporation, in a similar fashion, but it is much more difficult because S.A.s always have a president, a secretary, a treasurer and a fiscal. They are a more complex type of an organization usually answering to stockholders.
Cheers
Bill MaesI think Bill Maes’ advice is good. Cut your losses. Scrap the problem corporation and form a new one. This will result in the loss of your legal fees, but as long as the real estate was not purchased in the name of the corporation the loss is minimal and limited.
There are plenty of honest, competent attorneys around who can form a corporation for you at a tolerable cost. Depending on just where you’re located, I can recommend a couple.
Agreed! Dump this guy fast and email me privately the name of this attorney please –
Scott Oliver – Founder
WeLoveCostaRica.comRules are made to be broken, and corporations are made to be dissolved. That’s why you don’t put it in your personal name in the first place.
For an honest attorney I can recommend Sandra Echeverría Mesén. No fancy office, Spanish only. She helped me create and dissolve several S.A.s., as well as various Powers of Attorneys. Pizza Hut Paseo Colón, 250 meters North, on the right. Her brother is an accountant. They’ve both done work for foreigners, including handling their finances. No problems. email is carlosalvarado00@hotmail.com (Carlos is her partner).
Don’t worry Bill, if you’re speaking Spanish correctly, nothing is your fault. Whenever someone makes a mistake in Spanish, they use the “reflexive” form. “I forgot” becomes “Se me olvidó”, which means “It was forgotten”, “I dropped it” becomes “Se me fue”, which means “It fell from me”.
So you see, the error must have imposed itself on you through no fault of your own.
Pura Vida!
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