Denies Avícola Las Margaritas' extinctive prescription claim on dividends, upholds all five Lisa, S.A. peremptory exceptions
Jun 11 2024
5th Civil Court
The Fifth Multi-Judge Civil Court of First Instance in Guatemala issued its judgment on June 11, 2024, in the summary mercantile action for extinctive prescription filed by Avícola Las Margaritas, S.A. (successor by merger of Importadora de Alimentos de Guatemala, S.A.) against Lisa, S.A., dismissing the claim to extinguish by prescription the obligation to pay dividends for fiscal year 2013 as decreed at the June 10, 2014 shareholders' assembly. The court upheld all five peremptory exceptions raised by Lisa and imposed costs on the plaintiff.
Lisa, S.A. is a shareholder of the entity originally named Importadora de Alimentos de Guatemala, S.A., which was absorbed by Avícola Las Margaritas, S.A. through public deed number nineteen of September 30, 2020, executed before Notary Elena del Rosario Paniagua Samayoa. As a consequence of the merger by absorption, Avícola Las Margaritas acquired all rights and obligations of Importadora de Alimentos, and Lisa remained registered as a shareholder of the surviving entity.
At the Annual General Shareholders' Assembly of June 10, 2014, documented in minute number fifteen, shareholders approved the distribution of profits for the period from January 1 through December 31, 2013, at a rate of Q.837.60 per share. The assembly approved that management would be authorized to make payment "in the form and when it considers convenient." Clause sixteen, subsection (d), of the articles of incorporation (public deed number 168, dated November 13, 1996) establishes as an attribution of the Board of Directors to "determine the date and form of payment of approved dividends."
The complaint was filed on August 5, 2022. Lisa answered in the negative and raised five peremptory exceptions. The evidentiary period concluded and the hearing was held on May 23, 2024.
Avícola Las Margaritas sought a judicial declaration that any obligation to pay dividends to Lisa under the 2014 assembly resolution was extinguished by prescription, arguing that more than five years had elapsed since the obligation became enforceable (Article 1508 of the Civil Code), that Lisa did not judicially demand payment within that period, and that no acts interrupting prescription under Article 1506 of the Civil Code had occurred. The plaintiff invoked Article 675 of the Commercial Code to argue that the obligation was immediately enforceable because no payment term had been established.
Lisa answered the complaint in the negative and raised five peremptory exceptions.
Lack of veracity. Lisa argued that the plaintiff's assertion that dividends were available the day after the assembly lacked evidentiary support, since the assembly minutes themselves delegated to the Board of Directors the determination of the form and date of payment, with no evidence that the Board ever discharged that obligation.
Lack of exigibility. Lisa maintained that the payment obligation had not been perfected by the assembly's decision alone but required a subsequent act by the Board of Directors, specifically notification to shareholders of the amount, form, and date of payment. Absent that act, the obligation was conditional and not yet enforceable, preventing the prescription period from running. Lisa supported this argument with the notarial act of February 28, 2017, through which it formally demanded dividend payment from Importadora de Alimentos without receiving a response, demonstrating that dividends were not in fact available to shareholders.
Lack of free disposition and embargoes. Lisa demonstrated that since 1999, multiple precautionary embargo orders had been issued by various civil courts in Guatemala over all amounts corresponding to dividends, participations, and liquidations owed to Lisa in the Avícola Villalobos Group entities. These embargoes were requested by the plaintiff itself and by affiliated entities (Reproductores Avícolas, S.A., Compañía Alimenticia de Centroamérica, S.A., Industria Forrajera de Mazatenango, S.A.) in damages proceedings arising from shareholder exclusion resolutions, and the general manager of the plaintiff was appointed judicial depositary of the embargoed assets. Neither Lisa nor the plaintiff had free disposition over the embargoed dividends, making both payment and collection impossible.
Retained dividends. Lisa presented evidence that the Avícola Villalobos Group owed it $128,964,121.00 in retained and unpaid dividends since the fiscal year ending June 30, 1999, according to the certificate of accountant Lawrence Sidney Rosen dated May 24, 2012. The total value of retained shares and dividends amounted to $334,578,071.00.
Interruption of prescription. Lisa invoked as interrupting acts the summary opposition action against the shareholder exclusion resolution (Expediente 01164-2011-00090), the damages lawsuit filed by the plaintiff against Lisa (Expediente 01045-2012-00229), the extrajudicial demands for dividend payment of February 28, 2017 and October 31, 2018, and the precautionary embargo measures themselves as requested by the Avícola Villalobos Group.
Exigibility of the obligation. The court determined that under Article 132 of the Commercial Code, while the obligation to distribute dividends arises when the shareholders' assembly so resolves, in this case the assembly expressly delegated to the Board of Directors the determination of the form and timing of payment. Clause sixteen of the articles of incorporation confirms this attribution. Because the record contained no evidence that the Board of Directors had ever set a payment date and form, nor any evidence that other shareholders had been paid, the court concluded there was no certainty as to when the obligation became enforceable, making it impossible to compute the prescription period.
The court expressly rejected application of Article 675 of the Commercial Code (immediate enforceability of obligations without a set term), holding that the provision addresses obligations arising from mercantile contracts where no term has been established, whereas in this case the assembly did establish a mechanism for determining the payment date by delegating it to the Board of Directors, which never exercised that function.
Embargoes and free disposition. The court evaluated reports rendered by the Eighth, First, and Thirteenth Multi-Judge Civil Courts of First Instance, as well as the deposition of Avícola Las Margaritas' representative, who admitted that the Board of Directors is responsible for determining the date and form of payment. Based on this evidence, the court established that existing judicial embargo orders covered shares, dividends, and any liquidation corresponding to Lisa, that neither the plaintiff nor Lisa had free disposition over the embargoed dividends, and that third parties held legitimate interests protected by the existing precautionary measures.
"No se pudo establecer que efectivamente, la parte demandada Lisa, Sociedad Anónima, tuvo la oportunidad de ejercer su derecho de acceder a los dividendos en forma expedita y sin ningún tipo de limitación o gravamen que restringiera su libre disposición, según se acordó en la asamblea de accionistas celebrada." (Page 38)
Document in possession of the opposing party. The court ordered Avícola Las Margaritas to produce a document, which was not delivered within the prescribed period, reinforcing the evidentiary deficiencies of the plaintiff's case.
Avícola Las Margaritas appealed the judgment. The First Civil and Commercial Court of Appeals, in its ruling of November 4, 2024, partially granted the appeal: it maintained the dismissal of the prescription claim and upheld Lisa's negative answer and the exception of lack of veracity, but revoked the exceptions based on embargoes, free disposition, third-party rights, and interruption, holding that precautionary measures obtained by third parties cannot interrupt prescription nor serve as instruments to evade liability. The appellate court waived costs in the second instance. Avícola Las Margaritas filed a cassation appeal, which was dismissed by the Civil Chamber of the Supreme Court of Justice on October 7, 2025, definitively consolidating Lisa's victory at all judicial levels.