Hernán Cortés and the first moratorium in Mexico.

 Hernán Cortés was not the first Spaniard to step into what is now Mexico. Others did it before, some of them remained stranded, and the rest went back to Cuba and informed about a great amount of gold. The governor of Cuba commanded Cortés to explore the new territory, rescue the stranders and collect gold, but nothing regarding conquering.[1]

Along with Cortés, other soldiers joined the Spanish armada, with their own effects (weapons, horses, medicines), usually bought at an increased price and on credit with usury interest rates. The soldiers' creditors and sellers relied on the promised gold that the soldiers could collect in the new land.

Once Cortés arrived in Mexico, he disobeyed the Cuban governor's orders, founded a new municipality called Veracruz, and received from it, on behalf and representation of the King of Spain, the authorization to conquer Mexico.

When the Mexican empire fell, Cortés carried out the collection of gold. The collected amount was not what was expected. The soldiers could not pay back their creditors and were heavily indebted. They were indebted even with doctors, who performed healings on credit.[2] A crisis among the soldier started. Some of them believed that Cortés hid the gold for himself.

Hence, Cortés issued an order providing that two judges would reduce the price of the goods and services sold on credit and that if the soldiers could not pay it on time, they would be entitled to a moratorium of two years.[3]

 


[1] Riva Palacio, V. (1976). México a través de los siglos (13th ed., Vol. 1). Editorial Cumbre.

[2] Diaz del Castillo, B. (2017). Historia verdadera de la conquista de la Nueva España. Porrúa.

[3] Riva Palacio, V. (1976). México a través de los siglos (13th ed., Vol. 2). Editorial Cumbre.

Comentarios

Publicar un comentario

Entradas populares de este blog

Prepackage bankruptcy in Mexico

  A debtor may file a petition to be adjudicated in bankruptcy in three ways: the ordinary petition, the prepackage petition, and the imminent general default petition. Bankruptcy adjudication is not automatic, and even in voluntary petitions, a prebankruptcy procedure needs to be initiated before the bankruptcy adjudication. In the prebankruptcy, the parties will submit evidence to prove whether the debtor is in general default. It is not sufficient that the debtor merely confesses a general default to the court. However, there is no need for a prebankruptcy procedure in case of a prepackage petition, and the judge will immediately adjudicate the debtor in bankruptcy. The prepackage petition must be signed by the debtor and the creditors representing at least the simple majority of the total liabilities stating, under oath, that the debtor is in general default. Besides avoiding the prebankruptcy procedure, there is no other utility of the prepackage petition because: -       
Leer más

Foreign creditors in Mexican Bankruptcy proceedings.

  Foreign creditors have the same rights and opportunities as the national creditors before a bankruptcy proceeding in Mexico, although there are some exceptions. Creditors are a key factor in bankruptcy. The following is an initial and broad distinction of creditors.           a. Generic creditors. During the pre-bankruptcy proceeding, generic creditors do not participate; only the debtor and the visitor take part in voluntary petitions; and the debtor, the visitor, and the plaintiff (whether a single or group of creditors or the Fiscal Attorney) participate in involuntary petitions. After the bankruptcy adjudication but before the ruling on the allowance of claims, those acting as creditors may participate in the bankruptcy as generic creditors. The generic creditors have the following rights and powers: 1. They have access to the judicial record, the annexes that the debtor submitted with the voluntary petition, the visitor’s report, the bi-monthly reports presented by the r
Leer más

The cart before the horses, the difficult to avoid conversion to the liquidation stage.

The cart before the horses, the difficult to avoid conversion to the liquidation stage. Bankruptcy in Mexico has two successive stages: reorganization and liquidation. When reorganization is not possible, bankruptcy is converted to the liquidation stage. The purpose of the reorganization stage is to maintain the enterprise and pay the allowed creditors through a reorganization plan. The purpose of the liquidation stage is to sell the enterprise – as a going concern or in segments – and pay the allowed creditors. If a plan is not submitted and approved within one hundred and eighty-five calendar days following the publication in the Federal Official Gazette of the summary of the adjudication in bankruptcy, the reorganization stage is converted to the liquidation stage. The court can extend this period by ninety calendar days if the reorganization officer or a certain percentage of the allowed creditors request it. The court may grant a second extension if the debtor and a certain pe
Leer más