New Limitation Periods for Enforcing Judgments

Written by | Dispute Resolution

On 27 August 2021, Law 14,195/2021 was published, amending Brazil’s Code of Civil Procedure. Among other things, the Law sets out a specific time period for enforcing judgments (essentially creating Brazil’s version of the statute of limitations).

Under the new rule, judgments must be enforced in the same time period allowed for the underlying cause of action. Hence, for instance, a judgment entered:

  • against a tortfeasor (that is, a person who committed a civil wrong not covered by a contract), the judgment will need to be enforced within three years, as actions by and against insurers must be filed within three years from the date the tort took place (the same applies to directors, founders and liquidators for breaches of duties or corporate obligations);
  • against an insurer, the judgment will need to be enforced within one year, as actions by and against insurers must be filed within one year from the date the plaintiff became aware of the cause of action (in most cases);
  • against a creditor of a negotiable instrument, the judgment will need to be enforced within five years, as actions arising from negotiable instruments must be filed within five years from the date of the breach;
  • against a creditor of a liquidated debt, the judgment will need to be enforced within five years, as actions arising from liquidated debts contained in contracts or deeds must be filed within five years from the date of the breach; and
  • against a party to a contract, the judgment will need to be enforced within 10 years, as the general rule is that all actions (including those arising from contractual breaches) must be filed within 10 years from the event that gave rise to the action occurred, unless a Law provides for a shorter period.

An enforcement creditor may seek the enforcement stayed. This tolls (halts) the enforcement period for an additional one year.

These changes eliminate various unsettled issues of interpretation relating to the time period applicable to the enforcement of judgments.

If you are looking to enforce foreign judgments in Brazil, click here.

Questions?

Contact me if you would like further information. My firm is ready to assist you.

Last modified: September 16, 2021