Brazil’s New Civil Procedure Code

By:

The National Congress of Brazil

Courtesy Paul Burland/Flickr

Brazil’s New Civil Procedure Code (NCPC) was enacted on March 16, 2015, via Act No. 13,105/2015, and entered into effect as of March 2016. The procedural changes promoted by the NCPC open up new perspectives for managing litigations in the Brazilian Judiciary, which faces serious problems regarding the excessive number of ongoing lawsuits – among other shortcomings. In this essay we will briefly present some of the most important changes in the NCPC that can provide better results in resolving disputes.

Extension of Pre-Trial Proceedings. Traditionally, the Brazilian civil procedure did not include discovery proceedings and did not hold judgments before jury trials. Thus, it was mandatory that expert and witness evidence be produced throughout the trial, during proper time frames, when the parties would have the right to be heard.[1] In urgent situations, expert and witness evidence could be produced before the beginning of trial, using the so-called “anticipated evidence production” provision.[2] The NCPC extends the bases for accepting “anticipated evidence production” and authorizes it when “the evidence that will be produced may be capable of prompting out-of-court settlements or another proper means for conflict resolution” and when “previous knowledge of the facts may justify or prevent the filing of a lawsuit.”[3] This is a substantial innovation that will enable both parties to get in-depth knowledge on the factual situation that will be presented in court, and consequently to assess their probabilities of winning a potential future lawsuit. The correct use of this mechanism will certainly increase the number of settlements, especially those involving factual issues that can be settled by way of the evidence that has been produced.

Strengthening Mediation. The facilitation of out-of-court settlements between parties has also been welcomed as a means of strengthening mediation and conciliation. Brazilians have the cultural tendency to believe that the judiciary is the only responsible body for providing solutions to all kinds of conflicts.[4] The NCPC aims to cast this ideological paradigm aside by stimulating out-of-court settlements, thereby strengthening mechanisms such as mediation and conciliation. For that purpose, the NCPC determines – with few exceptions – that in civil lawsuits the defendant will be summoned to appear before a conciliation or mediation hearing, which will not be chaired by the judge, with the aim of facilitating a negotiation between the parties.[5] There are no legal provisions to limit the number of mediation or conciliation hearings and meetings, though there is an upper ceiling of 2 months from the first hearing[6]. This will depend on the progress of negotiations between the relevant parties. During this period, the defendant does not have to come up with his defense. The defendant’s time frame for formulating a defense will only begin to count whenever any individual party notifies that he/she has no interest on proceeding with the negotiations.[7] This seeks to avoid the negotiation of agreements in unfavorable environments. This becomes all the more evident in family lawsuits, in which the NCPC determines that the defendant need not even receive copies of the initial pleadings[8] – although the defendant may have access to them at any time – precisely to serve the purpose of preventing the intensification of conflicts and facilitating the establishment of agreements.

Repetitive Lawsuit Management. As previously mentioned, one of the most significant problems in the Brazilian Judiciary is the excessive number of lawsuits. The numbers involved are intolerable: there are nearly 50,000 lawsuits for every 100,000 inhabitants.[9] By way of comparison, in the United States there are around 5,700 lawsuits for every 100,000 inhabitants – and this is already regarded as a high figure compared to the world’s other most important economies.[10] A large share of the lawsuits currently under way in Brazilian courts regard repetitive cases, in which the discussion that is brought forward does not concern matters of facts, but rather matters of legal interpretation. Such lawsuits involve various categories: consumer law, tax law, pensions, etc. In this regard, the NCPC has laid down two crucial measures: a) the possibility of suspending lawsuits under way whenever there is the intention of creating legal precedents on the legal issues that will be applied to repetitive cases – thereby avoiding the unnecessary expenditure of resources and work;[11] and b) the creation of a model for binding precedents.[12] The Brazilian model was inspired by the common law system, with the aim of achieving the benefits of work rationality and legal certainty. In fact, the inclusion of a system of precedents will enable the Brazilian judicial procedure to accomplish greater predictability and equality by making use of the same decision in dealing with all parties who may be in similar legal situations with the one that gave rise to the precedent. This may well be the most important change in the NCPC, and will require much effort and adaptation of legal professionals until it becomes truly effective from a practical point of view.

Increasing Procedural Costs for Losing Parties. In various judicial systems, at the end of a lawsuit, the losing party is required to refund the lawyer fees that were paid by the winning party.[14] In Brazil, by contrast, the losing party pays those fees directly to the winning party’s lawyer instead of the party who effectively hired the lawyer.[15] These payments are earned in addition to the fees that had already been paid by the winning party to his/her lawyer.[16] The limits that the revoked CPC determined for lawyer fees included: a) 10% to 20% of the amount of the sentence for the entire litigation process, including appeals, although judges will normally set a rate of 10%;[17] and b) on average, 10% at the moment of the enforcement of the sentence, including possible appeals.[18] Although it does not extend the limit for ruling fees during the trial, the NCPC establishes that fees should be increased if appeals are filed, making fees of 20% of the litigation amount more frequent; the increase in fees during the appealing phases will also be valid for serving the sentence, in such a way that costs may reach 20% more in this phase of the lawsuit.[19] Furthermore, if the sentence must be legally enforced, the NCPC has retained the provision for charging a fine of 10% of the condemnation.[20] Thus, unlike the previous model, which lead to an overall burden of up to 30% on the losing party – in addition to the condemnation – in the NCPC, this percentage is expected to rise to 50% (or 66.6% higher costs), a fact that may possibly stimulate the fulfillment of out-of-court obligations.

Strengthening the Power of Judges in the Enforcement Proceedings. The Brazilian civil enforcement proceedings have been undergoing constant renovations since the ‘90s, due to the fact that they represent an essential point for providing efficiency to the judicial procedure.[21] The NCPC strengthens the power of the judge to enforce his decisions, making the proceedings all the more flexible and adaptable to different situations. It grants the judge the possibility of using all the means of coercion and subrogation needed to ensure enforcement of court decisions.[22] This means that the judge may determine not only the seizure of debtor’s assets in order to satisfy the performance, but also impose restrictions on the debtor, such as the ineligibility to make contracts with public institutions, limiting publicity, etc. It is hoped, therefore, that the debtor will assist in this implementation in order to achieve rapid and effective results. In addition, the judge may impose a fine on the debtor in the event of contempt of court, in an amount up to 20% of the value involved in the dispute,[23] and another fine of up to 10% of the amount involved for any unjustifiable violation of the court order.[24]

Better Regulations for Free Justice. The Brazilian Constitution warrants comprehensive access to the Judiciary, including to people with insufficient financial resources.[25] In this case, the party may be exempted from paying procedural rates, the winning party’s lawyer fees, and the costs for evidence production, among others, throughout the trial. This system was regulated by Act No. 1,060/1950, which determined that in order for anyone to claim the right to free justice, the person must declare that he has insufficient funds to pay for the proceedings’ rates and fees, taking into account the costs of providing for his own and his family’s needs.[26] Despite the extremely relevant social nature of this provision, access to free justice has commonly been used as a shield by “adventurer” litigants intending to transform the proceedings into a real lottery, with no concern for subsequent liabilities. In order to avoid this issue, on the one hand the NCPC grants judges greater control in awarding this benefit; on the other hand, it allows for partial concessions of this benefit – or even its restriction to specific acts throughout the proceedings.[27] The contribution of any financial assets by the litigating party, limited as they may be, encourages a greater degree of responsibility in filing suits or in formulating defenses. The NCPC’s provision takes such instances into account, and thus makes free justice available only to those who effectively need it, and within the bounds of such need.

These are a few of the procedural changes that the NCPC has brought forth. Further achievements of this new statute which may bring future benefits to Brazilian judicial proceedings include the greater value that has been ascribed to constitutional principles as well as the procedural streamlining that is expected to arise through the reduction of formalism.[28] It is quite evident that there is an array of provisions that still require further work, such as class actions and the criteria for selecting appeals to higher courts.[29] However, steps must be taken one at a time. The NCPC’s provisions bring hope for the reduction of litigations, with the introduction of instruments that are capable of avoiding unnecessary lawsuits, as well as allowing for the establishment of agreements and clearly defined rules of conduct that should be followed by society.


[1] Cf. Humberto Theodoro Junior, 1 Curso de Direito Processual Civil 904 (2015).

[2] Article 816 of the previous Civil Procedure Code.

[3] NCPC art. 381 paras. II and III.

[4] See note 8 infra and accompanying text (addressing the excessive number of lawsuits before the Brazilian Judiciary branch).

[5] NCPC art. 334.

[6] NCPC art. 334, §2º.

[7] NCPC art. 335, para. I.

[8] NCPC art. 695, § 1º.

[9] Courts in figures 2015, National Council of Justice of Brazil (2015), http://www.cnj.jus.br/files/conteudo/arquivo/2015/11/491328c33144833370f375278683f955.pdf (2014 data).

[10] J. Mark Ramseyer & Eric B. Rasmusen, Comparative Litigation Rates (Havard Law School, Discussion paper Number 681, 2010), http://www.law.harvard.edu/programs/olin_center/papers/pdf/Ramseyer_681.pdf.

[11] NCPC art. 982, para. II, and art. 1,037, para. II.

[12] Art. 927.

[13] The NCPC drafts explanatory memorandum states, “Perhaps the most significant changes of the procedural system connected with the objective of harmonizing it with the spirit of the Constitution are the ones concerning the rules that lead to the uniformity and stability of case law.”, https://www.senado.gov.br/senado/novocpc/pdf/Anteprojeto.pdf.

[14] See Stephen C. Yazell, Civil Procedure 292 (2008) (comparing the American and English rules regarding lawyer’s fees).

[15] Act No. 8,906/1994 art. 24.

[16] NCPC art. 25.

[17] Repealed CPC art. 20 § 3º.

[18] However, there was a flexible provision in the repealed CPC, at art. 20 § 4º.

[19] NCPC art. 85 § 11.

[20] NCPC art. 523 § 1º.

[21] See, e.g., Act No. 8,038/1990, Act No. 8,038/1990, Act No. 8,455(1992, Act No. 8,710/1993, Act No. 8,950/1994, Act No. 8,953/1994, Act No. 8,952/1994, Act No. 9,079/1995, Act No. 9,139/1995, Act No. 9,245/1995, Act No. 9,494/1997, Act No. 9,756/1998, Act No. 10,352/2001, Act No. 10,358/2001, Act No. 10,444/2002, Act No. 11,232/2005, Act No. 11,277/2006, Act No. 11,276/2006, Act No. 11,280/2006, Act No. 11,382/2006, Act No. 11,418/2006, Act No. 11,419/2006, Act No. 12,322/2010, Act No. 12,398/2011 and Act No. 12,810/2013.

[22] NCPC art. 139, para. IV.

[23] NCPC art. 77, § 2º.

[24] NCPC art. 536, § 3.

[25] Constituição Federal art. 5 para. LXXIV.

[26] Act No. 1,060/1950 art. 4.

[27] NCPC art. 98 § 5º. The judge is also allowed to grant the payment of rates and legal costs in installments. Id. § 6º.

[28] Cf. Paulo Cezar Pinheiro Carneiro, Comentários ao Novo Código de Processo Civil 57 (Teresa Arruda Alvim Wambier et al. eds. 2015).

[29] Regarding the procedure to select the appeals to Supreme Court, see Justice Luís Roberto Barroso, Reflexões sobre as competências e o funcionamento do Supremo Tribunal Federal, Migalhas (Aug. 26, 2014) http://www.migalhas.com.br/Quentes/17,MI206523,71043-STF+se+aproxima+da+terceira+decada+de+existencia+sob+severa+crise+de; Rodrigo Barioni, Repercussão geral – anotações sobre as propostas formuladas pelo ministro Luís Roberto Barroso, Migalhas (Sept. 2, 2014), http://www.migalhas.com.br/dePeso/16,MI208121,101048-Repercussao+geral+anotacoes+sobre+as+propostas+formuladas+pelo (commenting on Justice Barroso’s paper).

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