Litigation in Brazil: Unusual Features

Written by | Dispute Resolution

Litigating in Brazil is very different from litigating in common law jurisdictions. Below I address some of the more usual features that you are likely to face in litigation in Brazil.

1. Parties and some deponents are not bound to tell the truth

A person giving evidence will only be regarded as a witness (testemunha) by Brazilian courts if there is no impediment (impedimento) or suspicion (suspeição) in relation to the parties.

There is an impediment if the deponent:

  • is a party in the action;
  • is related to the parties in the action (except if the “public interest demands”);
  • acts for, or has assisted, a party.

There is suspicion if the deponent:

  • is a party’s enemy or close friend;
  • has an interest in the outcome of the dispute.

Those who are subject to an impediment or suspicion may be heard by the court, but they will do so merely as parties or as informants (informantes). They will not be sworn in and what they state before the court will not be regarded as evidence (prova) but just information (informação), which is given substantially less weight.

2. No cross-examination, short hearings and judge’s minutes of oral evidence

Oral evidence in Brazil is generally given less weight than documentary evidence.

In Brazilian civil proceedings it is the judge who conducts the examination of the individuals giving oral evidence. Judges do let lawyers ask questions, but often rephrase them as he or she sees fit. Therefore, it is much harder to undermine the statements made during evidentiary hearings.

Witnesses rarely spend more than 15 to 30 minutes being questioned and, at the end, judges summarise the contents of the evidence in written minutes. Lawyers can often suggest amendments to ensure that the evidence is correctly summarised.

3. Discovery/disclosure is extremely limited

As a civil law jurisdiction, discovery (or disclosure, as it is known in some jurisdictions) is not part of civil proceedings in Brazil. Yet, the availability of documents is even more limited in Brazil.

The reasons for the limited availability of obtaining evidence from other parties include:

  • requests for the production of documents must be very specific (nothing like “documents that are or may be relevant to the dispute”);
  • seeking production of documents from non-parties can take years as a separate action needs to be filed against that party;
  • only very few companies have sophisticated document retention policies;
  • legal professional privilege is very wide;
  • there are various data protection and secrecy provisions (such as bank secrecy); and
  • the privilege against self-incrimination is applied extensively.

Note also that there is no pre-trial deposition or any other exchange of information.

4. Legal costs (attorney’s fees) paid to lawyers (not parties!) and offers to settle make no difference to the award of legal costs

This is perhaps the most idiosyncratic rule found in Brazilian law – when a party wins a case, the court will order that legal costs (attorney’s fees) against the losing party. That is, of course, the rule in just about every common law jurisdiction (with the most notable exception being the American rule).

However, in Brazil, the court orders the losing party to pay the winning party’s lawyers an amount of money (generally between 10% and 20% of the amount awarded). This is called sucumbência and it is a measure supposed to reward a lawyer’s good work. By Law the funds must be paid to the lawyers, not the winning party.

Moreover, there is no mechanism of shifting legal costs like in the English system (and most Commonwealth jurisdictions). Hence, making offers to settle will not give your client a more advantageous costs (attorney’s fees) order.

5. Direct enforcement of negotiable instruments and contracts with two witnesses

Where a party seeks to enforce rights under a negotiable instrument (promissory notes, debentures, cheques and similar) and contracts that have two witnesses, among others, the party can opt to file enforcement proceedings.

Documents issued outside of Brazil need to comply with the formalities of the jurisdiction where they were made and Brazil must be chosen as the place where the obligation will be performed, otherwise the party seeking to enforce its rights will need to file a common action.

The key advantage of enforceable actions is that the enforcement debtor needs to provide security of payment to the court, which must be effected within three days from the date of service of process.

Questions?

Contact me if you require further information.

Last modified: December 1, 2019