On December 7 of 1999, attorneys Moritz Eiris Bonilla and Luis Andres Guerrero Rosales, holders of identity cards No. 5.303.574 and 6.816.219, respectively and registered in the Venezuelan Bar Association under numbers 19.660 and 28.521, respectively, acting as legal representatives of the business association INVERSORA MAEL C. A., registered before the First Mercantile Registry of Judicial Circuit of the Federal District and State of Miranda on July 18 of 1969, under No. 30, Volume 54-A Pro., its by-laws having been amended as per document recorded before the above identified Office of Registry on July 1of 1992, under No. 7, Volume 9-A Second., filed before this Chamber a declaratory action of absolute invalidity against: 1.- The agreement undersigned in July of 1991 by the plaintiff and the Instituto Autónomo Corporación Venezolana de Guayana, called the “Basic Agreement”, by which the parties convened that, in order to avoid claims against the Nation, by reason of the judgment issued by the Political-Administrative Chamber of the extinct (sic) Corte Suprema de Justicia (Supreme Court of Justice; at present, the Tribunal Supremo de Justicia) on May 9 of 1991, the Instituto Autónomo Corporación Venezolana de Guayana would enter into contracts with the plaintiff for the exploitation of gold and / or diamonds in the Guayana Region, for a total area of 3,078 hectares. 2.- The judicial transaction entered into in execution of the “Basic Agreement” dated July of 1991, by the plaintiff, Mr. Rafael Torres acting as curator bonis of the inheritance of Mrs. Dot Culver Whitney De Lemon and the Instituto Autónomo Corporación Venezolana de Guayana, before the Fifth Superior Court in Civil, Mercantile and Transit Matters of the Judicial Circuit of the Federal District and State of Miranda, on October 17 of 1991 and, 3.- The agreements undersigned in the execution of the “Basic Agreement” dated July 1991, by the plaintiff and the Instituto Autónomo Corporación Venezolana de Guayana, which comprised: i) the agreements undersigned before the Second Public Notary’s Office of Puerto Ordaz on July 28 of 1992, and ii) the agreements undersigned before the Second Public Notary’s Office of Puerto Ordaz on July 22 of 1993.

I

RECORD

The Court of Proceedings, as per record dated February 1 of 2000, declared the filed action for invalidity as inadmissible, as it considered that same had been extemporarily presented, by reason that over six (6) months had passed for its intervention according to the provisions set forth in Article 134 of the Organic Law ruling the Supreme Court of Justice.

On February 1 of 2000, the plaintiff’s attorney, Luis Andres Guerrero Rosales, appeared before the Court of Proceedings and denounced that, on that same date, for over thirty (30) minutes, he had been prohibited from obtaining access to the dossier, and that he had not been allowed to present an appeal of amendment of the libel, so that his right to defense and justice had been violated. The Court of Proceedings, as per writ dated February 2 of 2000, after hearing the previous proceedings, agreed to open the corresponding inquiry.

The plaintiff, on February 2 of 2000, consigned the proceedings before the Judge at the Court of Proceedings, and appealed to the bill issued by that Court, which had declared the inadmissibility of the lawsuit filed by her. As per writ dated February 3 of 2000, the Court of Proceedings forwarded the dossier to the Chamber to all resulting legal purposes. The Chamber took notice on February 8 of 2000 and named Magistrate Carlos Escarra Malave as arbitrator to decide on the filed appeal.

On February 29 of 2000, the Court of Proceedings delivered a decision in relation to the inquiry that had been opened, in connection with the claim filed by attorney Luis Andres Guerrero Rosales on February 1 of 2000, and dismissed same as being unfounded and, on March 1 of 2000, forwarded to the Chamber a certified copy of same.

On March 8 of 2000, attorney Roberto Mendoza Davila, holder of Identity Card No. 4.241.720, assisted by attorneys Eugenio Hernandez Bretón and María Fernanda Zajía, holders of Identity Cards No. 5.533.522 and 6.822.699, respectively, and registered in the Instituto de Previsión Social del Abogado (the Social Insurance Institute for Attorneys) under Nos. 18.395 and 32.501, respectively, acting as Legal Representative of MINERA LAS CRISTINAS, C. A., registered with the Mercantile Registry of the Judicial Circuit of the State of Bolivar on October 15 of the year 1997, under No. 28, Book A-N° 51, with its principal office in Puerto Ordaz, alleged to hold an active and legitimate authority to become a part in this trial, whereas it subjective rights and legitimate, personal and direct interests would be severely injured should the action filed by the plaintiff be allowed, and consigned a bill of opposition to the appeal filed by the plaintiff against the bill issued by the Court of Proceedings on February 1 of the year 2000, not to admit the complaint filed by INVERSORA MAEL C. A., and a bill of opposition to the admission of said complaint, should the bill of non-admission be revoked.

On April 4 of 2000, attorneys Adelaida Moreno Silva and Mariela Quintero, holders of Identity Cards No. 8.951.230 and 8.846.566, respectively, and registered in the Instituto de Previsión Social del Abogado under Nos. 37.961 and 48.837, respectively, acting as attorneys in fact of the Instituto Autónomo Corporación Venezolana de Guayana, presented a bill of opposition to the appeal filed by the plaintiff, INVERSORA MAEL C. A., against the decision issued by the Court of Proceedings, dated February 1 of de 2000, which refuses the admission of the lawsuit filed by same and that, in any case, the caducity of the action filed by the plaintiff be declared.

On April 13 of 2000, the Chamber ALLOWED the appeal exercised by INVERSORA MAEL, C. A. against the decision issued by the Court of Proceedings on February 1 of 2000, and declared the declaratory action of absolute invalidity filed by same to be inadmissible. Likewise, in this sentence it was ordered to forward the dossier to the Court of Proceedings, so that same may issue a judgment: a) in relation to the supposition of inadmissibility set forth in Article 84 of the Organic Law ruling the Supreme Court of Justice, in conformity with Article 346 of the Code of Civil Procedures; b) on the “adjudged issue” set up in connection with the transaction agreement; c) on the existence or non-existence of an “inept accumulation of actions” and d) on whether the limitation is the one set forth in Article 1977 of the Civil Code for personal the personal obligations, or the one set forth in Article 1346 ejusdem for the declaratory actions of invalidity.

On May 4 of 2000, the plaintiff filed a writ requesting an explanation on the opportunity to decide on the extinctive prescription of the action, which the Chamber, in a ruling dated May 17 of the year 2000, had declared UNGROUNDED.

On June 1 of 2000, the plaintiff filed a document with the Court of Proceedings containing its allegations in favor of admitting the lawsuit it had filed.

On June 6 of 2000, MINERA LAS CRISTINAS, C. A. filed a document with the Court of Proceedings containing its allegations against the admission of the lawsuit filed by INVERSORA MAEL C.A.

On June 7 of 2000, the plaintiff filed a writ with the Court of Proceedings containing its arguments in favor of the lawsuit it had filed.

On June 13 of 2000, the Instituto Autónomo Corporación Venezolana de Guayana filed a writ with the Court of Proceedings ratifying its arguments, expressed on April 4 of 2000, against the admission of the lawsuit inchoated by INVERSORA MAEL C. A.

On June 13 of 2000, the Court of Proceedings declared the plea to the admission of the action filed by INVERSORA MAEL C. A. presented MINERA LAS CRISTINAS, C. A., and the Instituto Autónomo Corporación Venezolana de Guayana, to be UNGROUNDED.

On June 20 of 2000, MINERA LAS CRISTINAS C. A. filed a writ of appeal with the Court of Proceedings against the decision dated June 13 of 2000 ruled by this Court, which admitted the action proposed by INVERSORA MAEL, C. A., and the Court of Proceedings went on record because of the refusal to hear the appeal that had been filed.

On June 27 of 2000, INVERSORA MAEL, C. A. motioned the Court of Proceedings to proceed and order the necessary compared documents to prepare the personal summons for the co-defendants and to modify the subpoena for the summons (sic) for the Instituto Autónomo Corporación Venezolana de Guayana, whereas the summons had to be issued in the name of its new President: This motion that was granted by the Court of Proceedings in a writ dated June 28 of 2000.

On December 20 of 2000, the Attorney General of the Republic forwarded a writ opposing (the) previous matter. MINERA LAS CRISTINAS, C. A. presented a document opposing (such) previous matters on January 9 of 2001 and the Instituto Autónomo Corporación Venezolana de Guayana, on that same date, presented a document opposing (…) previous matters.

On January 23 of 2001, INVERSORA MAEL, C. A., presented a document answering to the previous matters opposed by the Attorney General of the Republic, by MINERA LAS CRISTINAS, C. A. and by the Instituto Autónomo Corporación Venezolana de Guayana.

On January 30 of 2001, the Instituto Autónomo Corporación Venezolana de Guayana presented a document bringing evidences of the incidence on the previous matters that had been opposed, which had been admitted as per writ of the Court of Proceedings dated February 1 of 2001.

On February 8 of 2001, MINERA LAS CRISTINAS, C. A., presented a document bringing evidences of the incidence on the previous matters that had been opposed, which had been admitted as per writ of the Court of Proceedings of that same date.

On April 3 of 2001, the Instituto Autónomo Corporación Venezolana de Guayana, requested that the probative period on the incidence on previous matters be re-opened.

On May 9 of 2001 the Chamber took notice and named Magistrate Yolanda Jaimes to act as arbitrator to decide on the previous matters that had been opposed.

On May 22 of 2001, the Instituto Autónomo Corporación Venezolana de Guayana presented a writ of conclusions on the incidence on (the) previous matters promoted in this trial.

On December 4 of 2001, Magistrate HADEL MOSTAFÁ PAOLINI expressed his decision to inhibit himself in this case, by reason of being liable in the grounds set forth in Article 82, numeral 15 of the Code of Civil Procedures, which was declared justified on January 25 of 2002, reason for which the summons of the respective substitute or alternate judge was ordered.

On February 20 of 2002, the First Substitute, Dr. Humberto Briceño León, excused himself before the Chamber from accepting the summons to take part in the Temporary Chamber for this trial; on March 8 of 2002, the First Alternate Judge, Dr. Alfredo Morles Hernandez, excused himself before the Chamber from accepting the summons.

On March 20 of 2002, INVERSORA MAEL, C. A. presented to the Chamber a motion demanding the lack of quality of LAS CRISTINAS, C. A. to intervene in this trial be declared, for all the reasons set forth in the aforementioned motion.

On April 24 of 2002, the Second Substitute, Dr. Ricardo Henríquez La Roche, excused himself before the Chamber from accepting the summons to take part in the Temporary Chamber for this trial.

On May 28 of 2002, MINERA LAS CRISTINAS, C. A. filed a bill of opposition to the motion filed by INVERSORA MAEL C. A. on March 20 of 2002, petitioning the Chamber to decree its lack of quality to intervene in this trial.

On June 4 of 2002, the Second Alternate Judge, Dra. Maria Del Mar Álvarez, excused herself before the Chamber and declared it was not possible for her to accept the summons to be part of the Temporary Chamber to this trial.

On October 9 of 2002, a communication was received from the newly designated Alternate Judge Alejandro Cáribas, accepting the summons to become a part of the Temporary Chamber in this trial.

On November 27 of 2002, INVERSORA MAEL C. A., by means of a proceeding undersigned by its attorney in fact Juan Andres Wallis B., holder of Identity card No. 6.815.777 and registered in the Instituto de Previsión Social del Abogado under No. 26.283, waived the action and the proceedings followed during this trial in relation to the co-defendant Instituto Autónomo Corporación Venezolana de Guayana, and asked this Chamber to proceed with the homologation of this waiver. Likewise, the attorney in fact ratified the motion for a declaratory regarding MINERA LAS CRISTINAS C. A.’s lack of current interest as a third intervening party to continue acting in this trial.

On October 29 of 2002, the Temporary Political-Administrative Chamber, to hear this trial, was constituted as follows: President: Magistrate Levis Ignacio Zerpa, Vice president: Magistrate Yolanda Jaimes Guerrero and the Alternate Judge, Magistrate Alejandro Cáribas, who was named arbitrator.

On January 3 of 2003, MINERA LAS CRISTINAS C. A. presented a bill of opposition to the motion filed by INVERSORA MAEL C. A. regarding the supposed abandonment of the action and the proceedings and its homologation, of this cause. Likewise, in this motion MINERA LAS CRISTINAS C. A. pleas that the action proposed by the plaintiff on December 7 of 1999 be declared as inadmissible and, should such action be declared admissible, that the previous matters opposed by them be allowed.

On February 13 of 2003, attorneys Laura Esther Arriaga and Alejandro José Poletti, registered in the Instituto de Previsión Social del Abogado under Nos. 39.101 and 81.963, respectively, acting as attorneys in fact for the Instituto Autónomo Corporación Venezolana de Guayana, filed a document of agreement with the waiver to the action and the proceedings requested by INVERSORA MAEL C.A.

II

PREVIOUS MATTER

For this Chamber, the demand to previously render a judgment on whether the abandonment expressed by the plaintiff, INVERSORA MAEL, C. A. is valid or not, is evident a) as to the motion filed by the plaintiff in such sense that the lack of current interest in sustaining this trial be declared, which would affect co-defendant MINERA LAS CRISTINAS, C. A., b) on the agreement with such abandonment, expressed by the co-defendant Instituto Autónomo Corporación Venezolana de Guayana and c) on the plea filed by the co-defendant MINERA LAS CRISTINAS, C. A. to the motions of the plaintiff INVERSORA MAEL, C. A., previously stated.

It depends on this judgment of the Chamber whether or not it enters to try the appeal of inadmissibility of the proposed action, of the previous issues contested by the parties and, eventually, on the core of the issue.

MOTION FILED BY THE PLAINTIFF, INVERSORA MAEL, C. A.:

On November 27 of 2002, attorney Juan Andres Wallis B., acting as attorney in fact for the plaintiff INVERSORA MAEL, C. A., expressed his abandonment of the action and the proceedings relating to the trial brought by INVERSORA MAEL, C. A. containing the declaratory action of invalidity, and adds that the abandonment is being formally filed in relation to the co-defendant Instituto Autónomo Corporación Venezolana de Guayana. As to the other co-defendant, MINERA LAS CRISTINAS, C. A., he ratifies the motion filed on March 20 of 2002, relating to the declaratory regarding the lack of current interest which, in his opinion, affects MINERA LAS CRISTINAS, C. A. to continue acting in this trial, based on Resolutions No. 035 and 036 issued by the Ministry of Energy and Mines on March 6 of 2002, according to which the Republic re-assumed all the rights it owns on the expired and extinguished gold concessions Cristina 4, Cristina 5, Cristina 6 and Cristina 7, so that these concessions were reversed to the Republic, and declared the caducity of the exploration concessions and the subsequent exploitation of the copper ore and barrage deposits called Cristina 4, Cristina 5, Cristina 6 and Cristina 7, owned by MINERA LAS CRISTINAS, C. A.

POSITION OF THE INSTITUTO AUTÓNOMO CORPORACIÓN VENEZOLANA DE GUAYANA:

The Instituto Autónomo Corporación Venezolana de Guayana, in a writ delivered to this Chamber on February 13 of 2002, through its attorneys in fact Laura Esther Arriaga and Alejandro José Poletti, convened to agree on the abandonment filed by INVERSORA MAEL, C. A., ... “on January 11 of 2003”. The attorneys added they had been duly authorized for this action, as appears from the corresponding power of attorney.

PLEA FILED BY MINERA LAS CRISTINAS C. A.

On January 15 of 2003, MINERA LAS CRISTINAS C. A. delivered to this Chamber a bill of opposition to the motions presented by INVERSORA MAEL, C. A. on November 27 of 2002, and reasoned as follows:

1. That the plaintiff had not clearly and without mistake expressed its will to waive the action and the proceedings, submitting same to additional motions.

2. That MINERA LAS CRISTINAS, C. A. holds the active and legitimate power to intervene in this trial, as acknowledged by the Court of Proceedings in its bill dated June 13 of 2000, and that its condition as a party to this trial is non-controvertible.

In addition, MINERA LAS CRISTINAS, C. A., in a writ forwarded to this Chamber on May 28 of 2002, indicated that in due time it had contested Resolutions No. 035 and 036 issued by the Ministry of Energy and Mines on March 6 of 2002, by virtue of which same were not definitively firm (sic), reason for which MINERA LAS CRISTINAS, C. A. maintains its interest in this.

III

CONSIDERATIONS TO ISSUE A DECISION

For this Chamber to decide, it must verify whether the abandonment of the claim, as well as the understanding, do comply with the extremes to grant the homologation so it may acquire the authority or status of tried matter.

The Chamber observed that the abandonment of the claim declared by INVERSORA MAEL, C. A., the plaintiff in this trial in connection with the Instituto Autónomo Corporación Venezolana de Guayana, in writ dated November 27 of 2002, has been drawn up in a pure and simple format, not subject to terms, conditions or modalities and in an express and integral manner, whereas it concerns to the co-defendant Instituto Autónomo Corporación Venezolana de Guayana. It also appears from file 1 of the dossier, folio 62, that the author of the waiver, attorney Juan Andres Wallis B., evidences capacity to dispose of the object of this controversy, the abandonment not being contrary to the public order, as established in Article 87 of the Organic Law ruling the Supreme Court of Justice, in conformity with Article 264 of the Code of Civil Procedures, the waiver in relation to the formerly identified public entity is homologated. Therefore, it is decided.

As to the agreement with the abandonment of the lawsuit filed by the attorneys in fact of the Instituto Autónomo Corporación Venezolana de Guayana, attorneys Laura Esther Arriaga and Alejandro José Poletti, who had certainly been expressly authorized to agree on the abandonment of the lawsuit and the proceedings proposed by the plaintiff, INVERSORA MAEL, C. A., as evidenced from power of attorney kept in file 3 of the respective dossier, they erroneously expressed the wish of their principal when they made allusion to the proceeding... “presented on January 11 of 2003” ... by the plaintiff INVERSORA MAEL, C. A., the truth being that the proceeding expressing the abandonment of the action and the proceedings had been filed by the plaintiff on November 27 of 2002, reason for which this agreement is not being homologated. Therefore, it is decided.

As to the motion presented by the co-defendant MINERA LAS CRISTINAS, C. A. not to homologate the abandonment of the action and the proceedings proposed by the plaintiff, this Chamber observes that its argument of the wish not having been made clearly and without mistake is not true and therefore submitted same to additional motions. The additional motion formulated by the plaintiff made no allusion to the abandonment by the Instituto Autónomo Corporación Venezolana de Guayana, but by the co-defendant MINERA LAS CRISTINAS, C. A., in relation to which it requested that same be declared as lacking current interest to sustain this trial, reason for which the motion to homologate the abandonment of the lawsuit filed by the plaintiff, in connection with the herein identified public entity, is dismissed. Therefore, it is decided.

As to the motion filed by the plaintiff, to consider co-defendant MINERA LAS CRISTINAS, C. A. as currently lacking interest in sustaining this trial, as declared by same, the company’s condition of real party in the trial is not up for discussion as it has been proven when it took part in it, and it also had recurred to the administrative action issued by the Ministry of Energy and Mines, set forth in Resolutions No. 035 and 036 of March 6 of 2002 and which are therefore not final, reason for which, as to MINERA LAS CRISTINAS, C. A., the abandonment declared by the plaintiff does not operate. However, with the abandonment of the claim in relation to the Instituto Autónomo Corporación Venezolana de Guayana now being homologated, the matter claimed is now final, i.e.: 1.- The agreement entered into in July of de 1991, by the plaintiff and the Instituto Autónomo Corporación Venezolana de Guayana, called “Basic Agreement”, by means of which the parties agreed that, in order to avoid claims against the Nation, by reason of the judgment passed by the Political-Administrative Chamber of the extinct (sic) Supreme Court of Justice (Corte Suprema de Justicia) on May 9 of 1991, the Instituto Autónomo Corporación Venezolana de Guayana was to enter into agreements with the plaintiff for the exploitation of gold and / or diamonds in the Guayana region, for a total area of 3,078 hectares. 2.- The judicial transaction entered into in execution of the “Basic Agreement” dated July 1991, by the plaintiff, Mr. Rafael Torres acting as curator bonis of Mrs. Dot Culver Whitney De Lemon, and the Instituto Autónomo Corporación Venezolana de Guayana, before the Fifth Supreme Court Civil, Mercantile and Transit Matters of the Judicial Circuit of the Federal District and State of Miranda, on October 17 of 1991 and 3.- The contracts entered into, in the execution of the "Basic Agreement” of July 1991, by the plaintiff and the Instituto Autónomo Corporación Venezolana de Guayana, which comprise: i) the agreements entered into before the Second Public Notary’s Office of Puerto Ordaz on July 28 of 1992, and ii) the agreements entered into before the Second Public Notary’s Office of Puerto Ordaz on July 22 of 1993, and MINERA LAS CRISTINAS, C. A. looses interest in sustaining this trial, whereas its subjective rights and legitimate, personal and direct interests would not be damaged and the agreements entered into with the Instituto Autónomo Corporación Venezolana de Guayana for the exploration, development, and exploitation of the gold ore and barrage deposits located in the mining areas known as CRISTINA 4, CRISTINA 5, CRISTINA 6 and CRISTINA 7 would, in relation to this trial, remain intact, without prejudice of its lawful rights to claim any eventual damages which the disclaimer of the lawsuit filed by INVERSORA MAEL, C. A. would have caused. Therefore, it is decided.

IV

RULING

By virtue of the preceding reasoning, this Political-Administrative Chamber of the Supreme Court of Justice, administering justice in the name of the Republic and by authority of the Law:

1. ALLOWED the abandonment proposed by the plaintiff in relation to the co-defendant Instituto Autónomo Corporación Venezolana de Guayana.

2. DISMISSED the abandonment proposed by the plaintiff in relation to the co-defendant MINERA LAS CRISTINAS, C. A.

3. DISMISSED the composition proposed by the Instituto Autónomo Corporación Venezolana de Guayana

4. ALLOWED the abandonment of the current interest of the co-defendant MINERA LAS CRISTINAS, C. A. to sustain this trial.

Let it be published, recorded and notified. Let this dossier be filed.

Signed, sealed and delivered at the office of this Political-Administrative Chamber of the Supreme Court of Justice, on November twenty-fifth (25) of the year two thousand and three (2003). Historical Years 193 of Independence and 144 of the Federation.

Dossier No. 16700
AC/.
This decision was recorded under No. 01876 and published on November twenty-six (26) of the year two thousand and three.