Brazil: Mandatory Conciliation / Mediation Conference Under The New Code Of Civil Procedure

Last Updated: 1 August 2016
Article by L O Baptista Advogados

The new Code of Civil Procedure ('New CPC') introduced some innovations to Brazil's procedural system. One of them is the mandatory conciliation or mediation conference set out in article 334 of the New CPC.

Conciliation is a form of dispute resolution conducted by a conciliator, who is an impartial third party. The role of the conciliator is to end the dispute through an agreement. He plays an active role in the resolution of the dispute because he suggests and proposes solutions and also participates in the discussions and in establishing the bases for a settlement with the parties. Therefore, the role of the conciliator is to get the parties to settle the dispute through conciliation.

Mediation is somewhat different, because even though the mediator also is an impartial third party, he seeks to bring the parties closer to each other, encouraging them to come up together with a solution to the dispute. The mediator, therefore, is a neutral person who must allow the parties to reach a solution to end the dispute by themselves. His role is only to listen to them, without intervening directly. The mediator acts as a type of moderator and merely ensures the means for the parties to enter into a dialogue. Usually, the subjects addressed by mediators are more sensitive, such as child support, divorce, etc.

The Mandatory Conciliation or Mediation Conference under the New CPC

The New CPC innovated judicial procedure by introducing the mandatory pretrial conciliation/mediation conference. Before the procedure unfolds, the parties are required to submit themselves to conciliation/mediation. It is an innovation that seeks the resolution of the dispute at the outset of the procedure. It is like an "opportunity given by the legislator" for the parties to settle before the judicial procedure begins.

In ordinary common proceedings, the defendant is no longer notified to answer, but instead to attend a judicial conciliation/mediation conference, which is now mandatory in every lawsuit.

The head provision and paragraphs 1, 2 and 3 of article 334 of the New CPC are worded as follows:

"If the complaint fulfills the essential requirements and it is not a case for denial of the claim in limine, the judge shall schedule a conciliation or mediation conference at least thirty (30) days in advance. The defendant shall be served with notice at least twenty (20) days before the date of the conference."

Paragraph 1. The conciliator or mediator shall always participate in the conciliation or mediation conference, if there is one, subject to the provisions of this Code and of the court organization law.

Paragraph 2. More than one conciliation or mediation session may be held within no later than two (2) months from the date of the first session, provided that they are necessary for the parties to settle.

Paragraph 3. The claimant shall be served a notice of the conference through its lawyer.

As can be seen, the law clearly provides that there must be a period of at least 30 days between the date of the judge's order and the date on which the conference is held, and that the defendant must be served with notice of the conciliation or mediation conference at least twenty (20) days in advance.

The claimant must be given notice through his lawyer, while the defendant must be given notice in person, because this will be the defendant's first participation in the procedure.

As a rule, the conference must always be scheduled, except when the complaint is denied or in the situations provided for in paragraphs 4, 5 and 6 of Article 334:

Paragraph 4. The conference will not be held in the following situations:

I - if both parties expressly state that they are not interested in a consensual settlement;

II - when a consensual resolution is not allowed.

Paragraph 5. If the claimant has no interest in a consensual resolution, he shall indicate it in the complaint and the defendant shall do so through a motion that must be filed ten (10) days before the date of the conference.

Paragraph 6. In case of a joinder, all co-parties must express their lack of interest in holding the conference.

As can be noted, the conciliation conference will not take place in cases where all parties, including co-claimants and co-defendants, express their lack of interest in holding the conference or in case the dispute does not allow for a consensual resolution.

If the claimant is not interested in a conciliation conference, he must express that in its complaint, while the defendant may do so through an independent motion.

Paragraphs 7, 8, 9, 10, 11 and 12 of article 334 of the New CPC provide that:

Paragraph 7. The conciliation or mediation conference may be held electronically, according to the law.

Paragraph 8. The claimant's or defendant's unjustified failure to attend the conciliation conference is considered obstruction of justice and shall be punished with a fine of up to two per cent of the intended economic benefit or of the amount in controversy, which shall be applied to the benefit of the Federal or State Government.

Paragraph 9. The parties shall be accompanied by their lawyers or public defenders.

Paragraph 10. The party may appoint a representative, through a specific power of attorney, with powers to negotiate and settle.

Paragraph 11. The settlement reached shall be reduced to writing and confirmed through a judgment of ratification.

Paragraph 12. The agenda of the conciliation or mediation conferences shall be organized as to respect a minimum interval of twenty (20) minutes between the beginning of a conference and the beginning of the next one.

The legislator innovated once again by allowing for the possibility to hold the conciliation/mediation conference electronically. The use of these technological mechanisms allows the parties, their lawyers and the conciliators or mediators to communicate virtually, thus avoiding the need to go to the courthouses.

The presence of the parties is clearly not essential, as long as their representatives are present and have a specific power of attorney with powers to negotiate and settle.

The claimant's or defendant's failure to attend the conciliation conference will be considered obstruction of justice and will be subject to a fine.

If the parties settle, their settlement must be reduced to writing and confirmed through a judgment of ratification.

Conciliation and mediation are considered effective instruments for social pacification, prevention and resolution of conflicts and, if well explored, the conference can become an effective tool to ensure the parties' satisfaction with the result of their dispute, without having to wait years with the case pending in court.

It will also make the Judiciary speedier, as the success obtained in the conferences will dramatically reduce the number of actions pending in court.

After the entry into force of the New CPC (Federal Law No. 13,105/15), we will be able to see in practice the benefits that this procedural innovation will bring us.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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