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Well put. Although I might add that a shelf corporation also incurs the added cost of changing the board of directors. This is why pre-formed corporations are also know as “shell” corporation (easily confused with shelf and both one in the same) because they provide the shell to cover the newly added components, such as the junta directiva and other legalese and clauses that describe the purpose of the legal entity etc. With a newly formed S.A. or S.R.L. you appoint the members and you can include succession clause, of course if you do not plan on ever dying this would not be needed (Arrrrr).
JUST FOR TURDS AND GIGGLES I THOUGHT I’D GIVE IT MY BEST. I DO NOT EVEN PRETEND TO HAVE W DOG’S EXPERTISE BUT I HAVE HAD A LOT OF PRACTICAL EXPERIENCE WITH ATTORNEYS AND CR LAW SYSTEM.
Watchdog. I have some observations about escrowing funds with title insurance companies in CR that I hope will challenge your base of knowledge.
1. Do Title Insurance companies insure future acts of fraud, which occur after the date of the policy.NO
2. Does the CR Government guarantee the accuracy of a certified copy of a property title extract, issued by the Registry.
SLIM CHANCE TO NONE. MAYBE IN THEORY ONLY.
The particular law that states this is Article 73 of the Public Registry Regulation. (Reglamento del Registro Publico, Artículo 73, Responsabilidad del Registro por la información contenida en las certificaciones. El Registro dará fe de la información contenida en una certificación hasta el momento de su expedición. Las variaciones ocurridas con posterioridad a la hora de su expedición no acarrearán responsabilidad alguna al Registro).
3. The law surrounding the registration of property titles in the National Registry, is based upon the presumption of accuracy of what is registered, by third parties relying on the Registry process. This principal is known as “legitimacion registral”. Article 449 of the Civil Code (ARTÍCULO 449.- El Registro es público y puede ser consultado por cualquier persona. Corresponde a la Dirección de cada Registro determinar la forma y los medios en que la información puede ser consultada, sin riesgo de adulterarse, perderse ni deteriorarse).
WHAT IS THE POINT OF #3?
4. It has been interpreted by the Courts to mean that there is a presumption of accuracy of the Public Registry’s records. Likewise, in Article 34 of the Public Registry Regulation, the qualifying process in accepting Registry information is such, that only title information which is “valid and exact” in nature is accepted for registration purposes, by the Public Registry. (Artículo 34.—La Calificación. Control de Legalidad. La función Calificadora consiste en realizar un examen previo y la verificación de los títulos que se presentan para su registración, con el objeto de que se registren únicamente los títulos válidos y perfectos, porque los asientos deben ser exactos y concordantes con la realidad jurídica que de ellos se tiende. La calificación de los títulos consiste en el examen, censura, o comprobación que de la legalidad de los títulos presentados debe hacer el Registrador antes de proceder a la inscripción, con la facultad de suspender o denegar los que no se ajustan a las disposiciones de nuestro ordenamiento jurídico. Al momento de calificar, el funcionario asignado al efecto se atendrá tan solo a lo que resulte del título y en general a toda la información que conste en el Registro y sus resoluciones no impedirán ni prejuzgarán sobre la validez de éste, o de la obligación que contenga)
GIVE ME A BREAK – THERE ARE SO MANY FRAUDULENT DOCUMENTS REGISTERED. IF THE PROTOCOL IS CORRECT THEY ARE ACCEPTED, IT MAY HAVE NOTHING TO DO WITH THE LEGITIMACY OF THE PARTICIPANTS. FRAUDULENT DOCUMENTS ARE ALMOST REGULARLY ACCEPTED IF THEY HAVE NO ERRORS. THE REGISTRY DOES NOT VERIFY SIGNATURES OR CHECK OUT THE LEGITIMACY OF THE PERSONS WHO SIGN WHAT THE ATTORNEY SUBMITS – OJALA!!!
5. If a Notary/Lawyer conducts the correct due diligence for the property title research, no Title Insurance is necessary, as the true state of affairs will be revealed.
BIG “IF”
6. Any issue arising involving an irregularity with the title, can be dealt with by the Notary/Lawyer involved prior to a purchase of the property completing, or alternatively, the purchase offer can be rescinded.
UNLIKELY AND IMPRACTICAL – COULD TALE 1 ½ TO 10 YEARS – DEPENDING IF YOUR ATTORNEY WANTS TO TAKE YOU FOR A RIDE OR IF HE IS HONEST AND DILIGENT.
7. If the Notary/Lawyer is negligent in such a title search, there is an insurance fund administered by the Dirrecion Nacional Notariado (Notary College), which all Notaries are bound to pay into, which would pay proven claims for negligence arising in this instance.
INSUFFICIENT FUNDS TO COVER MOST LOSSES.
QUESTIONS:
1. Is Costa Rica a common law country? – YES
2. Isn’t there only one legally authorized insurance company in Costa Rica? – YES
3. Is a title guarantee in Costa Rica a bond of fulfillment or an indemnification? BEATS THE HEC OUT OF ME – DOG, YOU OUT THERE IN CYBER SPACE SOMEWHERE?BTW Sir Dog, how did I do???
MY OPINION – ALL IN ALL TITLE GUARANTY IN CR IS A PLACIBO – A BIG SUGAR PILL. tHE MANAGEMENT AT STEWART CR COULD CARE LESS ABOUT THERE PRODUCT. tHE GUY IN CHARGE IS ONLY LOOKING TO DO AS LEAST AS POSSIBLE WHILE STILL MAINTAINING HIS POSITION AND PAYCHECK. i HAVE DEALT WITH THEM AND i SAY “DISGRACEFUL.” iF i WAS TOP DOG THERE – HEADS WOULD ROLL. BEGINING AT THE TOP!
Pay the refugio. You will waste more time resolving this and you could use the saved time to make-up the $100.
Thanks watch dog – a true beckon in the darkness of Costa Rica rules and regs. Please stay tuned for more questions, I have a lot of em.
Muchas gracias…
WD,
Do you not find that there is trouble getting real estate deposits returned in Costa Rica; and that Tico sellers do not want to give a due diligence period in which they feel that they tie up their property without compensation for a month or so.
Perhaps you could suggest to the official that you could help each other out? remember that a policeman makes about what $300 a month, who could live on that, and I bet the official in question does not make much more. Lets be realistic here, you are only providing incentive to do his job, not asking for anything illegal. You are helping him prioritize his over burden schedule of duties.
The other side is he may not want to get involved in something that might latter come back to haunt him. He may not want to put his OK on the document because he may not know the code or law or he just does not want to take a chance. With the little money officials are paid, they have no incentive to make a delicate call regarding such matters. Did you find this reply helpful?
WD,
Again stellar replies, thank you.
I think you missed the gist of one of my questions, is the notary obligated to register the deed if all the parties have signed and he has satisfied your above mentioned requisites. In other words, even if he has not been paid or partially paid, is he obligated to register the escritura? Or can he withhold registration until his fees have been satisfied in full?
WD,
The second part of your answer is very interesting to me.
Do you consider the practice of foreign minority ownership of a costa rica entity that holds title to concession property to be legal (while the majority domestic ownership has no power in the entity). Does this type of contract disobey recognized good social customs, public order and does it prejudice a third party.
Is this common practice not intended to circumvent the law and therefore void the contract? I am assuming that any Costa Rica contract designed to circumvent the intent of the law is illegal therefore null and void.
Wow thanks WD for the great response.
Would 25% of the negotiated fee be a resonable amunt to charge a client who chooses not to proceed with the purchase through no fault of the notary.
Is it true that the notary is not responsible for registration in the Public Registry until all needed documents are provided and signed, monies are available and government fees paid in full
and
most notaries will not provide the deed until their fees have been paid, because once both parties have signed it, the notary is obligated to register the deed at the Public Registry.
Watchdog,
Outstanding answer, thank you. In the US, real estate sales contracts have liquidated damages clauses. Could you enlighten us regarding if they exist in Costa Rica and to what extent one can be liable for not completing a transaction? Do attorneys/notarys have a right to recive liquidated damages?
Dido Vega 268 3902 – he also does independent property appraisal which are very thorough. He lives in Heredia.
Sorry Alvaro, I thought there was an attorney who frequents this site by that name(?). But I doubt he would want to touch this subject with a 10 foot churro. Pura vida sometimes can be pura mentida. Be careful to whom you send money.
