By: Garland M. Baker B.
Exclusive to A.M. Costa Rica
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Many times going to see a lawyer in Costa Rica is like taking a science lesson. Every so often, they tend to make any discussion about the law or a legal matter very complex. They love to write out lengthy descriptions of legal procedures on blackboards or whiteboards.
There are times when this is important. A thorough explanation of a subject needs to be outlined in detail, so a client can understand the facts. This is especially the case for many expats who do not speak Spanish — or are up in their years — to grasp the intricacies of a situation or a legal case. This is not true in many other matters. A simple explanation is better. Most importantly, many expats prefer a succinct discussion to a long, drawn out one.
The fact is, Costa Rican lawyers do not do “simple” very well. They feel they need to dive into a subject deeply. This is not a criticism. It is probably just part of the culture. It goes along with greeting someone. Likewise, it is very difficult for Costa Ricans not to go through a long greeting process when they meet another person.
They feel the need to ask about everyone in the family and current events. Often, they feel slighted if they feel the other party is in a rush and cannot engage in a lengthy greeting. This is true for telephone conversations too. Most expats on the other hand like to get down to business.
They like, “Hello how are you, what's the bottom line,” types of conversations.
There are attorneys that need to make a show to justify their fees. If something is too simple, it must mean it is not very valuable, and, thus, they cannot charge very much for it. A complex matter justifies more money.
Attorney and notary fees in Costa Rica are based on a “tabla,” or a set table. The table is created by the local bar association, called the Colegio de Abogados. Some 10 years ago, a person filed a constitutional case against the setting of fees. They stated among many other things that it was anticompetitive and a type of price fixing. During the time the constitutional court was studying the matter, the use of the fee table was suspended. In the end, the justices found the setting of fees to be legal, and the use of the fee table was reinstated.
In 2005, Executive Decree 32493 ended any other further discussion over the matter by ratifying Article
1, Section b of Law 6595, stating that the Colegio de Abogados is the responsible entity for setting all fees for attorneys and notaries. The bar association comes up with the fee calculations and then sends it to the Poder Ejecutivo, the executive branch of the government, for approval.
It is not too hard to figure out that almost everyone involved in the fee structure for attorneys and notaries is at least one of them. They are the foxes setting the rules for the hen house.
The fee table used by attorneys and notaries in Costa Rica is more of a guideline than a strict pricing rule. However, when it is convenient for the professional to use it, they adhere to it rigidly. This is normally the case when something is easy to do and takes virtually no time at all and should cost much less than the fee schedule states. On the other hand, with truly complex matters that go far beyond the scope of the pricing of the fee table, the same professional will discard it and ask for more money.
In other parts of the world — like the United States — many legal matters can be performed without an attorney. Two examples most expats are familiar with are transferring the deed of a car or a property. In most states, the transfer of a vehicle is as easy as signing the back of a title and getting the signature notarized. This is far from true in Costa Rica. A notary is needed to transfer a vehicle because they need to put the transaction in their protocol book, make a testimony of the act, and submit it to the Registro Nacional. The same is true for the transfer of a property in this country.
In addition to transferring assets, most states in the United States have approved, standardized forms people can use for a variety of other legal matters, even divorce. There are a few — very few — forms one can use here for certain legal activities. The most common is the renting of an apartment or a house. Forms are available — but very hard to find — for a rental agreement. The rule of thumb in this country is a person needs an attorney for court and a notary for anything official that needs registration in the Registro Nacional.
The notary fee, as much as 1.5 percent of the deal for property transfers, is a drag on the economy.
In theory, all this mumbo jumbo and added official paperwork is to curb fraudulent transactions when, in fact, what it has done is contributed to an increase in property crime and the illegal transfer of other assets as well.
Here are two facts regarding legal professionals most people do not know. Attorneys and notaries have a kind of insurance to cover errors and omission and outright negligence. However, the amount of insurance is so minuscule that it is virtually worthless in a legal dispute. In addition, the statute of limitations for the bar association to discipline, as in suspend or expel a legal professional, is only two years from the date of the act. Not the date one finds out about it, but from the actual date of the mistake.
For the New Year, here is a bit of good advice for working with legal professionals in Costa Rica. Understand the fee table they use is a guideline, and realize that all fees can be negotiated. Even though it is difficult to find good and honest lawyers and notaries, shop around for legal services if pricing is an issue. Feel free to discuss pricing openly with the legal professional. Most importantly, pay based on results. The carrot in front of the horse really works here. Set objectives and pay accordingly. If a discussion regarding a legal matter is getting out of hand and turns into a classroom course in calculus, ask politely for the “nitty-gritty.”
Article first published in A.M. Costa Rica on January 5, 2009.
