3-4/2005 UINL - Notarius International

Notarius International 3-4/2005 J. A. Márquez González, National Report Mexico 211
In any case, it is clear that an important exception to
this, expressly contemplated in our legislation by virtue
of a subsequent reform, is contained in article 1549 bis,
which is discussed above (simplified public wills).
4.6. Succession through substitution by a trustee
Even though we continue to be guided by the principle
of freedom of last will and testament (articles 1295 and
1344). It is clear in any case that the philosophy of the
Civil Code retains a framework of restrictions that limit
the testator's freedom in certain circumstances.
These restrictions can be perceived very clearly in the
case of conservation of the freedom to make a will of the
heirs themselves. Thus, substitutions of heirs or legatees
involving more than one generation, clauses that prohibit
certain assets from being alienated, fiduciary dispositions
and conditions that are clearly illegal are prohibited.
For example, it is expressly provided that a condition imposed
on the heir to marry or not marry will be considered
as not having been included.
4.7. Executorship
In legitimate succession, the executor (albacea) of the
estate is directly appointed by the judge – or by the notary
-, at a meeting of all the heirs (articles 805 of the Code
of Civil Procedure of the Federal District and 1862 of the
CCFD). This meeting is only omitted if there is a single
heir or if the interested parties cast their vote in the response
to the call. In accordance with the specific list
provided in the Code, the executor may be universal, special,
joint and general.
Our Civil Code also refers to other representatives in
succession, i.e. the executor (ejecutor) (general or special,
article 1702). This executor confines his activities to
the sums or things that have been placed under his responsibility
in the total net worth of the total inheritable
estate.
Article 1728 refers to the concept of the auditor (inventor)
and his duties are confined to supervising the office
of the executor.
5. Company Law
There are two types of companies in Mexican civil law:
the Asociación Civil (Civil Association) and the Sociedad
Civil (Civil Company).
5.1. The civil association
In accordance with article 2670, the Civil Association
is defined as follows: “When a number of individuals
agreed to meet, in a way that is not entirely temporary, to
achieve a common purpose that is not prohibited by law
and is not of a predominantly financial nature, they constitute
an association”.
The agreement must be made in writing and must contain
the bylaws of the association, which are required to
be entered on the public register. The notary's involvement
often extends to drafting the minutes of the general
meeting at which the association is founded and the bylaws
themselves, as well as the respective notarisation of
the act.
In view of the philanthropic nature of associations of
this type (the law states that they must not be of a predominantly
financial nature), in the event of dissolution,
the assets will be put to a particular use, according to
what is provided by the statutes or according to what is
decided by the general meeting itself. However, the powers
of the general meeting are restricted solely to allocating
the equivalent of their contributions to the members
of the association.
What happens to the other assets? The final part of article
2686 of the law states that they must be applied to
another association, provided that the purpose of that association
is similar to the association that is extinguished.
5.2. The civil company
The second type of corporate body governed by our
law is the Civil Company. Article 2688 of the CCFD
states as follows: “Through the incorporation papers, the
members mutually agree to combine their resources or
their efforts to achieve a common purpose, of a predominantly
financial nature, but which does not consist of
commercial speculation”.
As we can see, the difference between civil associations
and civil companies in Mexican law basically relates
to their purpose, since companies have a “predominantly
financial” purpose. Besides that important difference,
companies have company capital, whereas associations
have assets. This means that companies have equity
participations and can distribute earnings, which is not
the case with associations. Also, in the case of companies,
it is possible for members to assign their equity participations,
whereas in associations, the rights held are
highly personal. Finally, in the case of companies, directors
have unlimited joint and several liability, which is
not the case in associations. 6
The incorporation papers are normally made in writing,
but the involvement of the notary is required if assets that
require it are being transferred. It must also be entered on
the register in order for it to take effect against third parties.
Article 2693 states the requirements for the contents
of the incorporation papers.
It is important to clarify that the acquisition of real estate
by these companies must comply with the provisions
contained in article 27, section III of the PCUSM, which
contains the following restriction:
Public or private charitable institutions whose purpose
is to help those in need, scientific research, dissemination
of teaching, reciprocal aid of their members or any other
lawful purpose may not acquire more real estate than is
absolutely necessary for their object and that is immediately
or directly intended for it, subject to the regulations
contained in the law.
The obligation of members in companies of this type
includes a subsidiary guarantee for the executive members'
unlimited joint and several liability; other members
only cooperate through their contributions, unless otherwise
provided in the incorporation papers.
6 MIGUEL ÁNGEL ZAMORA Y VALENCIA, Contratos Civiles (Civil Contracts),
Porrúa, México, 1998, pages 238-239.