LEGAL ACTION AGAINST A CURACAO TRUSTEE

Who can bring an action?

If the trust assets have been prejudiced, the action can be brought by any co-trustee. Unless provided for to the contrary in the trust deed the action can also be brought by a protector or beneficiary on the understanding that the compensation is paid as soon as possible to a Trustee not being the Trustee who violated his duties (Section 3:143 subsection 4 Curacao Civil Code {‘CCC’}). The question is to whom the protector has to pay the compensation if there is no co-trustee. This question is not answered in legislation, but in practice in …
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22
Nov 2012
CATEGORY

Legal

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MY VIEW ON THE LIABILITY OF A CURACAO TRUSTEE

The Reference Trustee

The trust originates from Anglo Saxon law. On designing the Curacao trust system the systems in other jurisdictions have obviously been studied. However, the Curacao trust is a civil law and not a common law trust. Therefore in answering the question of the (possible) extent of the liability as given shape in Book 3 Curacao Civil Code (‘CCC’), a connection should be sought with the law of Curacao (and elsewhere in the Kingdom) and not with foreign legal systems.

The fact that the Trustee has a position of trust, as laid down by law, does not, according …
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15
Nov 2012
CATEGORY

Legal

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CURACAO TRUSTEE HAS A DUTY OF CARE

Trustee is liable if he fails to exercise due care

A duty of care is justified in those cases where someone entrusts his financial or other interests to another or takes care of these himself with the assistance of the other, particularly because that other possesses more knowledge and experience in that field. The law formulates as a general standard that the Trustee is liable if he fails to exercise due care as a good Trustee unless he cannot be blamed for the failure (Section 3:143 subsection 1 Curacao Civil Code {‘CCC’}). This relates to a duty arising from the …
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08
Nov 2012
CATEGORY

Legal

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THE CURACAO TRUSTEE

Breach of trust results in liability

Usually a Curacao trust office (service provider) uses one of its own public limited liability companies (NVs) or private companies with limited liability (BVs) to provide the services. This in-house NV or BV will then for instance become the managing director of the client company. A trust office offering services as a Trustee will usually also do this in the form of an in-house NV or BV who will act as the Trustee. The Trustee will be able to fulfill this role with regard to multiple trust assets.

For third parties it is important …
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01
Nov 2012
CATEGORY

Legal

COMMENTS No Comments

POWERS AND OBLIGATIONS OF A CURACAO TRUSTEE

Brief summary

On 1 January 2012, new legalization entered into force pursuant to which it is now possible to set up a trust, similar to the trust in Anglo-Saxon common law jurisdictions, in Curacao (a civil law jurisdiction).

Here follows a brief summary of several of the powers and obligations of a Trustee:

  • the Trustee is entitled and obliged to administer the trust assets with regard to which he is obliged to render account (Section 3:127 subsection 2 under c Curacao Civil Code [‘CCC’]);
  • the Trustee is obliged to administer the trust assets according to the law and the provisions …
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  • 25
    Oct 2012
    CATEGORY

    Legal

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    TYPES OF LIABILITY IN CURACAO

    A three-part distinction

    With regard to liability a three-part distinction can be made. The first distinction relates to the basis of the liability: liability pursuant to a contractual relationship (the attributable failure in this respect) and liability pursuant to a wrongful act.

    Another distinction relates to the personal liability (thus for the party’s own actions or omissions) and vicarious and/or strict liability: liability for or the acts and omissions of others (vicarious liability) or liability for certain things that happen (strict liability).

    For example, employers can be held vicariously liable for certain actions of their employees. According to the Curacao …
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    18
    Oct 2012
    CATEGORY

    Legal

    COMMENTS No Comments

    CURACAO CREDIT INSTITUTIONS

    Prudential supervision

    The Curacao regulatory legislation applicable to credit institutions provides for requirements with regard to the prudential supervision in general. Such prudential supervision sees to the liquidity and solvency position of a bank without going into further detail for instance as to the safekeeping of assets or maintaining of accounts of third parties.

    The Curacao legislation provides for reporting requirements that need to be submitted to the Central Bank of Curacao and St. Maarten (CBCS). However, these requirements apply only to banks regulated in Curacao.

    On the basis of such reports and accounts the CBCS has the authority to …
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    12
    Oct 2012
    CATEGORY

    Legal

    COMMENTS No Comments

    CURACAO FUNDS AND ADMINISTRATORS

    Statutory requirements applicable to the organizational and legal structure

    The National Ordinance on the Supervision of Investment Institutions and Administators (Landsverordening regelende het toezicht op beleggingsinstellingen en administrateurs; NOSIIA) provides for a regime of supervision for investment institutions and administrators with the objective of an adequate operation of the financial markets and the protection of investors in such markets.

    With regard to the business operation of a local fund that operates within the scope of the NOSIIA it provides for requirements applicable to the organizational and legal structure as expressed in the fund’s constitutive documents. Such requirements address the conditions …
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    05
    Oct 2012
    CATEGORY

    Finance

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    SEMINAR ONDERNEMINGSRECHT

    22, 23 en 24 oktober 2012

    Het ondernemingsrecht is continu in beweging. Hier bij ons in Curacao, maar ook in Nederland. Boek 2 van het Burgerlijk Wetboek Curacao is op 1 januari 2012 op tal van punten gewijzigd. Wat houden deze wijzigingen precies in? Wat betekent de invoering van de Flex-BV in Nederland per 1 oktober 2012 voor Curacao?

    Denk wat Curacao betreft bijvoorbeeld ook aan de invoering van een integrale regeling inzake het enqueterecht per 1 januari 2012. Het is nu mogelijk om het Hof van Justitie een of meer onderzoekers te laten benoemen om onderzoek naar (vermeend) wanbeleid …
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    21
    Sep 2012
    CATEGORY

    Corporate

    COMMENTS No Comments

    THE TRANSFER OF BEARER BONDS IN THE DUTCH CARIBBEAN

    No deed required

    Under the laws of the Dutch Caribbean (Aruba, Bonaire, Curacao, St. Maarten) transferring the title of bearer bonds (i.e. bonds which are owned by whoever is holding them, rather than having a registered owner) does not require a transfer deed. In other words: such a bond is transferred by surrendering the original document. The transfer of ownership is thus accomplished simply by the transfer of said document.

    Under Dutch Caribbean international private law, the general rule is that the ‘lex rei sitae’ determines who holds legal title to movable assets (such as bearer bonds) and whether and …
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    20
    Sep 2012
    CATEGORY

    Finance

    COMMENTS No Comments

    CIVIL PROCEEDINGS IN CURACAO

    Information for foreign plaintiffs

    Are there any particular issues that concern foreign plaintiffs in Curacao? If proceedings on the merits are initiated by a non-resident plaintiff, the defendant may ask the court to order that the plaintiff provide security for damages, costs and interest which it might be liable to pay as a result of the judgment in aforementioned proceedings. This ‘cautio judicatum solvi’ does not apply if there is a Convention (Treaty) on legal proceedings between Curacao and the plaintiff’s country.

    Can attorney costs for legal proceedings be recovered? Generally speaking, each party has to bear its own attorney …
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    25
    Aug 2012
    CATEGORY

    Legal

    COMMENTS No Comments

    INADEQUATE CAPITALIZATION OF A CURACAO COMPANY

    Liability for thin-capitalization?

    A shareholder is not personally liable for acts performed in the name of the company and is not liable to contribute to losses of the company in excess of the amount which he must pay to the company as contribution for his shares.

    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. In almost all jurisdictions, undercapitalization as such is …
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    16
    Aug 2012
    CATEGORY

    Corporate

    COMMENTS No Comments