Brazil: Arbitration And Execution Proceedings Based On Extrajudicial Title

With the development and consolidation of arbitration as an effective means of dispute resolution in Brazil, new issues have arisen that demand the attention of the courts and commentators. One of these issues is the controversy over the possibility of bringing execution proceedings in the judicial courts based on a contract that contains an arbitration provision.

Under the Brazilian Code of Civil Procedure (Código de Processo Civil – CPC), a creditor who claims a certain, liquid and enforceable debt based on "extrajudicial title for execution" may proceed directly to collection of the debt through an execution proceeding, without first bringing cognitive proceedings (i.e. an ordinary action) to have his right to the debt recognized by the court. One of the documents that constitutes "extrajudicial title for execution" is a "private document signed by the debtor and by two witnesses". Thus, any written contract stipulating a certain and liquid debt which is signed by the debtor and two witnesses would, in theory, give the creditor the right to commence an execution proceeding. In such proceedings, the debtor has the right to reply by initiating a cognitive proceeding ("embargos à execução"), connected to the collection action.

When a contract which constitutes extrajudicial title for execution also provides for arbitration of disputes, the relation between the coercive aspect of the collection of the debt and the cognitive aspect of the embargos à execução poses some questions, notably by reason of the novelty of the subject for both case law and legal doctrine.

It can be said that an arbitration proceeding is equivalent to a cognitive proceeding in the judicial courts, and that consequently the execution of certain, liquid and enforceable debts falls outside the scope of arbitration. Thus, a party who claims performance of an obligation established in an extrajudicial title for execution may enforce the claim through an execution proceeding before the judicial courts, even if the contract contains an arbitration provision.

In this case, the judge in execution proceeding will have jurisdiction to appreciate and grant all measures related to the execution, while the arbitrator will have jurisdiction to decide questions going to the creditor's right to the debt, which would typically be argued in a cognitive procedure, such as an action for a declaration of the unenforceability of the debt (ação declaratória de inexigibilidade), or in an objection to execution (embargos do devedor).

In effect, the appeal courts of São Paulo and Rio de Janeiro have found that the judge's and the arbitrator's respective jurisdictions do not overlap or cancel each other out; instead, they complement each other.

In this context, arbitration can be understood as an alternative to objections to execution and declaratory actions (which are typically cognitive in nature) incidental to execution proceedings, and accordingly the existence of a contractual arbitration agreement would not constitute grounds to dismiss the execution proceeding, within the strict terms of articles 267 (VI), 580 and 585 §1 of the CPC.

There is also some question as to whether the commencement of arbitration will suspend a judicial execution proceeding. Law 11.382/06 amended the provisions of the CPC governing execution of extrajudicial titles. One of the most significant changes, introduced in a new article, 739-A, was to create conditions for speedier and more effective enforcement. Article 739-A provides that, as a rule, objections by the execution debtor do not have the effect of staying the execution. Exceptionally, the execution debtor may request that the execution be stayed, but the debtor must prove that (i) there are good grounds for defence; (ii) the execution will cause serious damage that would be difficult to repair; and (iii) the debt under execution has been secured by attachment of property, deposit into court or a bond.

In other words, as the law now stands, we believe that the simple fact that there is a cognitive proceeding related to the liquidity, certainty or enforceability of a debt under execution, regardless of whether the cognitive proceeding is before the judicial courts or before an arbitrator, should not necessarily result in a suspension of the execution proceeding. Instead, the judge in the execution proceeding must assess the requirements set out in article 739-A of the CPC and determine whether the execution should be stayed pending the outcome of the cognitive proceeding.

The Superior Tribunal of Justice (Brazil's highest court in nonconstitutional matters) recently decided in an action for provisional relief (Medida Cautelar no. 13.274-SP {2007/0225507- 1}) that a judicial execution action is not incompatible with arbitration proceedings, and that the existence of arbitration is not cause to dismiss the execution action. However, Minister Nancy Andrighi held that existence of arbitration meant that the execution must be stayed after attachment of the debtor's property, citing various precedents of the Superior Tribunal of Justice to support her interpretation. All the precedents cited by the Minister, however, predate the changes made by Law 11.382/06 and were therefore based on the now revoked art. 739§1 of the CPC.

Debate on the issue continues, and the question now is whether Minister Nancy Andrighi's decision in Action for Provision Relief no. 13.274-SP is consistent with the new rules introduced in article 739-A of the CPC, under which the mere existence of an arbitration proceeding or cognitive action (objection to execution or declaratory action) does not automatically result in a stay of pending judicial execution proceedings.

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.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions