BUSINESS & ECONOMICS

Monday, July 20, 1998 Online Edition 115

Wills allow people to control their assets after death

By MELANIE WETZEL

When a person dies, all of his/her property must be distributed. Any person who wishes to have a say in who will receive his/her belongings must write a legally binding will. This is a solemn act in which a person designates how all or some of his/her property will be distributed, and it has effect only after the person's death.

In Honduras, only a notario can authorize a will. Notarios are specially trained to be aware of the seriousness of a will. It is a very important document, because at the time of its execution the person who is distributing his/her property will not be around to answer questions.

Everyone has the legal capacity to make a will except the following persons: children under 12, people who have been judicially declared insane; people who are temporarily not of sound mind due to drugs, alcohol or other causes; and those who cannot express themselves either verbally or in writing. Foreigners who are residents in Honduras can make a will here. They will need two interpreters in addition to the three witnesses required by law.

A will can be changed or replaced by its author at any time, as long as he/she is still of sound mind. Each following will annuls any wills that came before it, therefore the valid will is the one with the most recent date.

International law has a general principal that states that all documents legally produced in one country are valid in another country. This can be applied to wills, keeping in mind that when a legal document is used in a country other than the one in which it was created, it will be brought under additional scrutiny.

Foreign citizens living in Honduras should seek the advice of a lawyer with experience in international private law if they have any questions over the validity of a foreign will here in Honduras or if they need to make a will.

For those of you who do not have a will, do something about it with the help of a lawyer, Honduran or from your country of citizenship. Next week, we will look at the incredibly sticky situation that can arise when a foreign person with residency and family in Honduras dies without a will.

Applications for new banks examined

The Bank and Securities Commission is currently reviewing two new applications for banks, the daily La Tribuna reported Tuesday (July 14). The proposed names of the banks are Banco Popular and Pro America. A minimum of Lps. 50 million (US$3.75 million) in capital is among the requisites needed to open a bank in Honduras.

Commissioner Fernando Vega refused to reveal the names of the investment groups applying for the banks, nor did he confirm or deny rumors that the family of former President Reina is the applicant for Pro America.

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Monday, July 13, 1998 Online Edition 114

By MELANIE WETZEL

Corporate lawsuits can be very exciting, and a murder trial can hold moments of mystery and intrigue, but nothing in the legal field provides as much high drama as inheritances.

Could dad really leave all of his children out of his will in favor of his new mistress? Was grandma really in a sound state of mind when she left the house to her cat? To answer these questions and many more, some of my next columns will be dedicated to wills and inheritances.

This week we will look at some of the general qualities of inheritances.

In Honduran Law, the right of inheritance is described as a "transitory" right. When a person dies, he can no longer be considered the owner of something, so the right of property or ownership (dominio) is extinguished. The right of inheritance takes its place, and this right belongs to the heirs.

After all the legalities of determining the rightful heirs, and dividing the assets, the right of inheritance once again becomes ownership, in the hands of the heirs. The right of inheritance fills this transitional period between one property owner and the person who will succeed him in those rights.

There are two forms of inheritance: testamentary and intestate or Ab Intestato (Latin). The inheritance is testamentary if there is a valid will, and if there is not a valid will it is intestate. If the deceased has left a valid will, it will be followed.

The only exception is that the current wife must receive at least one fourth of the estate and any children who are eligible for support must receive an inheritance to cover that support. These two obligatory bequests will be decreed by the judge if they are not included in the will. The rest of the will remains intact.

In Honduran law there are also two ways to make bequests: universal and singular. A universal bequest is one that includes all of the estate or a percentage of the estate. "I leave all my belongings to Joe, my son," or "I leave half my belongings to Joe, one-fourth to my brother Bob, and one-fourth to my wife." These are all universal bequests. A singular bequest is one that indicates a specific item, for example, "I leave my house in San Pedro to my son," or "I leave my rare stamp collection to my friend Bob."

It is important to remember that the average person's estate contains assets and debts. Singular bequests are transferred with any lien or charge that they contain. If it is a singular bequest of a house, the mortgage of that house goes with it. If the particular item in a singular bequest has no liens or charges, it is passed with clear title, regardless of other debts in the estate.

Universal bequests are a portion of the whole estate; therefore the bequest contains all the debts contracted by the deceased. If there will be nothing left after paying off the debts, then the universal heirs will receive nothing.

In a situation where the debt and the assets are running neck and neck, the heirs can request an inventory, before accepting the inheritance. If the inventory shows (or if the heirs already knew) that the estate has more debt than assets, the heirs should not accept the inheritance.

An inheritance that is not accepted is passed to the municipality of the last known residence of the deceased. If they are smart they will not accept it either and it is then passed to the creditors, so that they may liquidate the assets and recuperate a portion of what is owed.

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By JORGE FLORES MCCLELLAN

Color, texture and taste. Fine, fine taste. That is all that is sought for in a cigar and it also describes everything you find at Casa Habana, an exclusive smoking club in Tegucigalpa that is comparable to the best in the world.

It is no wonder that for tobacco enthusiasts, old and new, all over the planet, places like these allure them into secluding themselves, to smoke their favorite cigars from private humidors, drink the best liqueurs, sit in full comfort and enjoy the company of other connoisseurs.

Even before Columbus came, native Americans smoked tobacco in rituals that went from the most sacred to the most banal. But it has always been a ritual, left for the privileged in tastes.

Today, you can find cigar smokers in all the walks of life, from heads of state to cigar chomping campesinos, and all will agree it is one of life's luxuries.

Christopher O'Hara, vice president of Licensing and Tobacco Products for "Smoke" Magazine, visited Casa Habana last week in his tour of Honduras' tobacco fields and cigar factories, which, according to him, are number two in the world in quantity and quality, after Dominican Republic, Cuba now relegated to third place.

He explained that the world boom has now leveled off to about one billion cigars a year and that cigar smoking is not a trend but an age old custom with ups and downs, like for example, in 1970 when 2 billion cigars were smoked.

He said Dominican Republic will be the world leader because of quality and easy access to the U.S. market, compared to Honduras where bureaucracy tends to keep business away.

O'Hara also shared inside information about new and small brands that come and go against renowned brands that have increased their marketing backed by old traditional names like Zino Davidoff, Partagas, Cohiba and others, but he also gave credit to new names that have gained, with honors, their share of the world market.

As we sampled fine Puros Indios cigars, hand made in the premises by bonchero Luis Artica, rolero Dennis Gonzalez and supervisor for Honduras Cuban Tobacco, Francisco Vasquez, O'Hara and Gabriel Lardizabal, General Manager of Casa Habana, and others, discussed world issues about cigars and then talked about the question at hand: which cigar is the best.

Of course, everyone had their opinion in their mouth, but everyone agreed on one thing: taste is subjective, but all cigars are great.

Casa Habana is located on the east end of Boulevard Morazan, in front of Centro Comercial Los Arcos and carries several famous brands for all tastes and exquisite paraphernalia for smokers.

Go ahead, acquire the taste. Smoke!

Monday, July 6, 1998 Online Edition 113

Workers are required to 'get away from it all' once a year

By MELANIE WETZEL

All workers in Honduras have a right to annual paid vacations, according to the Labor Code. This is a non-negotiable right: even if the worker chooses, he may not agree to a compensation in return for not taking vacation time. The amount of vacation time depends on how long the employee has worked for the employer.

After one year, the worker has a right to 10 working days of vacation, after two years the worker receives 12 days. A worker who has been with the same employer for three years has a right to 15 days of vacation and after four or more years the worker receives 20 working days. These days must be in a row if the worker chooses.

When one calculates the time that a worker has been employed, any absence from work does not interrupt the time employed. Unless the contract is terminated, the time employed continues to run. For example, if a worker is injured after six months of work, and his legitimate absence due to injury lasts six months, he will get back to work just in time to ask for his vacation, for having completed a year of employment. Unauthorized absences cannot be subtracted from vacation time, unless the employer pays the employee for the day missed.

In jobs with irregular workdays or seasonal work, an employee must work 200 days of the year to count as a year of employment.

The employer must pay the worker his vacation salary three days before the agreed vacation begins. The vacation salary is calculated by averaging the workers pay for the last six months. The worker is not allowed to work for another employer during his vacation.

As in all labor-related material, the employer is responsible for keeping records of vacation time granted. The employer must always have proof that he has fulfilled his obligations to the employees. As stated earlier, even if the employee wishes, he may not accept other compensation in place of paid vacation. If this were to occur, the employee is not going to be the one who is sanctioned by the law, it will be the employer.

When a work contract ends, one of the many financial obligations of the employer is to pay any vacations that the worker has earned and not taken. If the contract ends with the employer firing the employee for reasons not specified in the work contract or Labor Code, the employer must pay the employee the proportional amount of any vacations partially earned.

We can look at the example of an employee who has worked three years, six months. After three years, he took his 15-day vacation. Six months later he is fired without just cause. The employer must pay him 10 days of vacation pay, because he has worked half of the fourth year, and would have had 20 days for the entire year. However, if he is fired with just cause, the employer is not required to pay the partially earned vacations for the last six months.

It is recommended that any person who has employees work with a lawyer who is experienced in labor law and can help the employer understand all of his obligations. Many large companies hire law school graduates as personnel managers. Not only are they aware of the employers obligations to the workers, and his obligation to maintain records, but if a labor conflict arises, the company has an in-house lawyer to handle the case.

U.S. restores trade benefits

WASHINGTON, D.C. -- The United States has restored trade preferences for Honduras in recognition of steps taken by the Honduran government to stop broadcast piracy, the Office of the U.S. Trade Representative (USTR) announced July 1.

In a statement, USTR Charlene Barshefsky credited Honduran President Carlos Flores with making "significant progress" in protecting the intellectual property rights of U.S. broadcasters. Honduran government actions included the temporary shut-down of television stations that were pirating U.S. programming and videos.

The USTR decision, effective June 30, restores the duty-free treatment afforded certain Honduran products under the Generalized System of Preferences (GSP) and the Caribbean Basin Initiative (CBI). The preferences, which apply to Honduran products with an annual import value of about $5 million, had been suspended on March 30 of this year.