The Second Court of Appeals denied Lisa, S.A.'s appeal and confirmed that its defective complaint and lack of condition objections are merits issues reserved for trial.

Case Background

Avícola Villalobos, S.A., through its representative Alberto Antonio Morales Velasco, filed an ordinary lawsuit against Lisa, S.A. alleging abuse of right through excess and bad faith in the exercise of its right of action. Avícola alleges that Lisa, after being excluded as a shareholder of Avícola Villalobos, filed a criminal complaint before the Fourth Criminal Court of First Instance (criminal case 01069-2013-00541), seeking to attribute criminal offenses to Avícola and demanding the return of registered share certificates that, according to the plaintiff, no longer belonged to Lisa. Avícola claims the complaint was dismissed at the request of the Public Prosecutor's Office and that Lisa's abusive exercise of its right of action caused commercial harm and defense costs, the amount of which Avícola requests be determined by expert opinion pursuant to Article 150 of the Judiciary Act.

The complaint was admitted on February 9, 2024 and served on Lisa on February 29, 2024. Lisa filed preliminary exceptions of defective complaint and lack of condition, both of which were denied in the Order of July 26, 2024 issued by the Judge of the Seventh Multi-Judge Civil Court of First Instance, with costs imposed on Lisa.

Grievances Raised by Lisa, S.A.

Lisa filed an appeal raising three grievances.

On the defective complaint exception. Lisa argued that the complaint bases its claim on Article 18 of the Judiciary Act (abuse of right), but the facts described actually allege defamation, which should be grounded in Article 1656 of the Civil Code. According to Lisa, this disconnect between the legal basis and the facts constitutes an incurable formal defect that should have been resolved at the preliminary exception stage rather than deferred to trial.

On the lack of condition exception. Lisa argued that the plaintiff failed to demonstrate or prove the illicit purpose attributed to Lisa or the existence of a right directly linked to the alleged harm. Lisa maintained that the criminal complaints were dismissed at the initial stage, that no procedural act was ordered against Avícola by the investigating authority, and that there was no conflict with third-party rights. Lisa concluded that abuse of right is not presumed and that the plaintiff should have detailed and factually proven the alleged commercial harm.

On costs. Lisa argued that the cost award resulted from the court's failure to rule substantively on the exceptions rather than from any malicious conduct, and that Lisa exercised its defense rights in good faith.

Arguments by Avícola Villalobos, S.A. on Appeal

The plaintiff defended the first-instance ruling. Avícola argued that the complaint satisfies all requirements of Articles 61, 106, and 107 of the Civil and Commercial Procedural Code, and that the first-instance judge properly vetted the complaint upon admission. On the legal basis, Avícola specified that the claim rests on Articles 18, 17, and 150 of the Judiciary Act and Articles 1653 and 1645 of the Civil Code, and that Article 1656 of the Civil Code does not apply because the claim is not based on defamation, slander, or libel. Regarding the lack of condition, Avícola maintained that no condition precedent exists for an abuse of right action, and that the limits on the right of action require the repair of damages when that right is exercised with excess and bad faith.

Court's Analysis

On the defective complaint. The Court of Appeals held that the defective complaint exception is strictly procedural and limited to verifying compliance with the formal requirements of Articles 61, 106, and 107 of the Civil and Commercial Procedural Code. The court cited Guatemalan scholar Mauro Chacón Corado, who states that this exception applies when formal requirements of the complaint are not met. The court concluded that the legal basis invoked bears a relationship to the facts alleged, and that determining whether the facts constitute defamation (Article 1656 of the Civil Code) rather than abuse of right is a merits question that must be addressed during the substantive phase of the proceedings.

On the lack of condition. The court analyzed the doctrine of Mario Aguirre Godoy, Juan Montero Aroca, and Mauro Chacón Corado, as well as the Circular of March 27, 1980, issued by the Presidency of the Judiciary and the Supreme Court of Justice, which distinguishes four distinct grounds within Article 116(7) of the Civil and Commercial Procedural Code. The court determined that Lisa's arguments regarding the nonexistence of abuse and the failure to prove harm do not constitute conditions to which the plaintiff's right is subject, but rather merits issues that must be resolved during the proceedings, where the parties will have the opportunity to prove their respective factual propositions.

On costs. The court applied Article 576 of the Civil and Commercial Procedural Code, which imposes costs on the losing party in incidents by operation of law. The court concluded that the good faith invoked by Lisa does not constitute a ground for exemption under that provision.

Ruling

• The appeal filed by Lisa, S.A. against the Order of July 26, 2024 was denied
• The first-instance ruling rejecting the preliminary exceptions of defective complaint and lack of condition was confirmed
• Lisa, S.A. was condemned to pay costs on appeal
• The court ordered notification and return of the file to the court of origin with a certified copy of the ruling

Legal Basis

• Article 8 of the American Convention on Human Rights — right to a hearing by a competent tribunal in the determination of civil rights
• Articles 12 and 203 of the Constitution of the Republic of Guatemala — right of defense and inviolability of rights, and judicial power to adjudicate
• Articles 602 and 603 of the Civil and Commercial Procedural Code — appealability of orders resolving preliminary exceptions that terminate the proceeding and incidents on separate track, and the principle limiting appellate review (quantum devolutum tantum apellatum)
• Articles 61, 106, 107, and 109 of the Civil and Commercial Procedural Code — formal requirements of the complaint and the court's authority to reject non-conforming complaints
• Article 116(7) of the Civil and Commercial Procedural Code — preliminary exceptions for failure to fulfill conditions or terms
• Article 576 of the Civil and Commercial Procedural Code — imposition of costs on the losing party in incidents
• Circular of March 27, 1980, of the Presidency of the Judiciary and the Supreme Court of Justice — interpretation of the four grounds within Article 116(7)

Signatories

• Karin Sorelly Gómez Girón, Presiding Magistrate
• Cándida Rosa Ramos Montenegro, Magistrate, First Chair
• Maira Antonia Pimentel Delgado, Magistrate, Second Chair
• Mayra Alejandra Padilla Borrayo, Clerk of Court