THE DUTCH CARIBBEAN INCORPORATION DOCTRINE
The courts apply the law of the state where the legal entity was incorporated
The Netherlands Antilles adheres to the Incorporation Doctrine (Netherlands Antilles State Ordinance of 9 September 1960, which entered into force on the 10th of September 1960, P.B. 1960, 166). According to this doctrine, the internal affairs of a corporation are governed solely by the laws of the state in which it was formally incorporated. This doctrine was confirmed in the cases of Natco Trust v. mr Thesseling q.q., Hoge Raad (Dutch Supreme Court) 20 April 1990, NJ 1991, 560; TAR-Justicia 1 (1991), p. 24-35, and IBC …
Read the rest »
SCANNED EVIDENCE UNDER THE LAWS OF THE DUTCH CARIBBEAN
Electronic files will not be disregarded as evidence
A Netherlands Antilles or Aruban court may only base its decision on facts. An alleged fact that is not disputed by the parties is considered to be such a fact, even if it does not correspond with reality. For example, if both parties state that they were involved in a fight in Curacao, the court will assume the correctness thereof, although both parties know that the fight was actually in Bonaire. Furthermore, facts can be proven in the course of the proceedings, e.g., by showing the court an official extract of a …
Read the rest »
DIRECTORS’ LIABILITY IN THE DUTCH CARIBBEAN
Personal and several liability
The members of the Board of Directors are personally and severally liable towards the NV (or BV, as the case may be) for any loss caused by the improper performance of duties. Each member of the Board who proves that he cannot be blamed for such improper performance and that the activities concerned fall outside the scope of activities addressed to him, and that he has not been negligent in taking steps to avert the related consequences, is not liable (Article 2:14 Section 4 Netherlands Antilles Civil Code; NACC). Therefore, a division of tasks among such …
Read the rest »
SEE YOU IN COURT?
Arbitration as an alternative for settling disputes in Curacao
Parties with a legal dispute can turn to the public court system to settle the dispute; however, instead of bringing a lawsuit in a public court, they can also opt for arbitration. Arbitration is a form of private dispute settlement in which the parties instruct one or more persons (arbitrators) to render a binding decision on their dispute. The arbitrators may be jurists, but they can also be laypersons. People with specific expertise or experience in a certain branch or industry are often chosen as arbitrator.
Parties …
Read the rest »
COMMENCING PROCEEDINGS AGAINST MULTIPLE DEFENDANTS IN THE DUTCH CARIBBEAN
Non-residents can be sued
A general rule under the Netherlands Antilles code of civil procedure is that the Curacao court (or another court in the Dutch Caribbean as the case may be) has jurisdiction over defendants which are (in this example) Curacao residents or companies with an office in Curacao. In the case of multiple defendants, there is a general rule to the effect that if a Netherlands Antilles court has jurisdiction over one of the defendants (i.e., where the defendant has its corporate seat or domicile) it has jurisdiction over all defendants, including non-Netherlands Antilles residents or companies in cases …
Read the rest »
PRE-TRIAL MOTIONS IN ARUBA
Differences with the United States
Civil proceedings in Aruba differ substantially from those in the United States. In Aruba there are, for instance, no juries. In principle, legal proceedings are basically conducted in writing. Oral pleadings are customary in preliminary relief proceedings, but optional in proceedings on the merits. Discovery proceedings like those in the United States do not exist. Pre-trial motions similar to those in the United States do not exist in Aruba either. There are, however, so-called incidents or ancillary proceedings in Aruba.
An ancillary proceeding may be a separate procedural step or an ancillary step within the …
Read the rest »
INADEQUATE CAPITALIZATION OF AN ARUBAN COMPANY
Liability for thin-capitalization?
In terms of ‘piercing the corporate veil’, thin or inadequate capitalization usually means capitalization that is not in proportion to the nature of the risks the business of the corporation necessarily entails; in other words it is based on likely economic needs rather than legal requirements.
Shareholders of a company in Aruba are under an obligation to pay to the company what is due with respect to the shares, i.e. the shareholder’s capital contribution, and such contribution may not be withdrawn without due process. This is the only financial obligation of a shareholder towards the company, unless …
Read the rest »
LAW FIRM MARKETING AND THE INTERNET
Blog posts reinforce your expertise and reputation
I found this article on CNN’s website: ‘How can small companies make money from social media?’, and it made me start thinking about whether social media is a business for law firms.
I joined LinkedIn and SunZu (f.k.a. Ecademy) back in 2004. I was among the 1st million members of LinkedIn: member number 952,524 in fact!
I now have profiles on Xing, Facebook, Eleqt (f.k.a. Elysiants), Legal360.nl, Martindale-Hubbell Connected and several other sites too. Joining …
Read the rest »
THE THREE STAGES OF LEGAL PROCEEDINGS IN THE DUTCH CARIBBEAN
General observations regarding adversarial proceedings
All adversarial proceedings in the Dutch Caribbean shall be initiated by means of a petition to the Court of First Instance of the Netherlands Antilles or Aruba. Claims will be denied or rejected (afgewezen) by the Court if ruled that they are unfounded. If a claim is denied for reasons other than the merits of the claim then the claimant’s complaint will be declared non-admissible (niet-ontvankelijk). In exceptional cases the petition will be declared void and in some cases the court may rule that it is not competent to hear the case.
An appeal can …
Read the rest »
LECTURE ON GOOD CORPORATE GOVERNANCE IN CURACAO
Corporate Governance Adviser must be a strong and independent watchdog over the executive also
On April 13, 2010 a seminar on Good Corporate Governance with respect to Curacao-owned enterprises and foundations was held in Curacao, and organized by Certa Legal. I was one of the keynote speakers and delivered my presentation in the Dutch language (click here for the presentation or click here for the coverage of the event by the Antilliaans Dagblad).
I argued that government-owned companies should be left out of the political sphere as much as possible, so they can benefit …
Read the rest »
ORDINARY ADVERSARIAL VERSUS SUMMARY PROCEEDINGS IN THE DUTCH CARIBBEAN
The court only considers the key issues
According to Article 110 and 111 of the Netherlands Antilles Code of Civil Proceedings (NACCP), all adversarial proceedings shall be initiated by means of a petition to the Court of First Instance. Proceedings so initiated are ordinary proceedings, unless the petitioner expressly opts for preliminary relief proceedings (kort geding) under article 226 NACCP. This article provides that in urgent cases which require an immediate decision the plaintiff may request a provisional decision (beslissing bij voorraad).
Article 229 NACCP provides that a provisional decision rendered as a result of this special type of proceeding …
Read the rest »
OBITER DICTUM OR NOT?
Litigating twice on the same matter is not allowed
The Netherlands Antilles Code of Civil Procedure prevents parties from litigating twice on the same legal issue. The principle that a final judgment of a competent court is conclusive upon the parties in any subsequent litigation involving the same cause of action is known as ‘res judicata’. A Dutch court case is described below illustrating this principle: Utrecht District Court of 19 March 2009 (NJF 2009/291).
In initial litigation, the claimant had sought payment of certain contractual penalties. The Court of Appeals rejected the claim on two separate grounds, the first …
Read the rest »