Piercing the corporate veil in food-related matters
The Specialized Family Court examines the application of piercing the corporate veil in FOOD MATTERS. On July 1, 2023, the Specialized Food Appeals Court began operating, with the purpose of specializing in handling food-related second-instance matters from the first, second, and third judicial circuits of San José. This will allow the Family Courts of San José to exclusively focus on resolving family-related cases.
On September 5, 2023, the court issued its first ruling (sentence number 2023-000835 at 9:03 AM on September 5, 2023) on piercing the corporate veil in the context of child support, which marks an important milestone in the specialization and efficiency of the Costa Rican Judicial System.
What does piercing the corporate veil mean? Simply put, piercing the corporate veil is the court’s authorization to determine who or who is behind the legal entity (i.e., its shareholders or quota holders), seeking to resolve significant legal matters not through the legal entity itself, but through the real (physical) individuals who effectively act under that entity’s guise.
What is novel and relevant about this case is that, for the first time in Costa Rica, the concept of piercing the corporate veil was used to resolve a child support matter. This resulted in the unification of criteria in family law, aiming to determine or dismiss the community property in child support cases; in other words, it will no longer be so easy to excuse oneself or “protect” assets through a corporation to “hide” property that could be used to determine a certain child support amount or even rights over community property.
For our team of legal advisors at Lexincorp Costa Rica, it will be a pleasure to keep you updated on the latest judicial developments in Costa Rica. For any inquiries, you can email us at: infocr@lexincorp.com
Written by: Jimena Muñoz
