Fernando Dantas M. Neustein *

The drafting of new codes is in fashion in Brazil at present, with Congress discussing a new Code of Civil Procedure and a new Criminal Code. Furthermore, a group of professors has drafted a white paper on a new Commercial Code, while a taskforce led by Superior Court Justice Herman Benjamin recently finalised a white paper detailing proposed changes to the Consumer Defence Code.

However, such change is not without resistance. For example, reactions against the speed at which the Code of Civil Procedure bill was reviewed by the Senate became so strong that it was forced to back down and has now pledged more time to review the initiative. The minister of justice has recognised the undeniably controversial nature of the proposal, following opposition from entities such as the Sao Paulo Bar Association, the Federal District Bar Association and the National Confederation of Industry, as well as from renowned scholars. The main criticism is based on two issues:

the merits of the proposal (ie, whether it grants excessive powers to judges); and

its pertinence (ie, the impetus behind the bill was to address the slowness of the administration of justice and the problem is therefore structural, not legislative).

When the proposed changes to the Consumer Defence Code were announced, commentators were first struck by the surprising nature of the content. The taskforce in charge of drafting the proposal had announced publicly that modifications would focus on issues such as over-indebtedness and e-commerce. These issues had been chosen as when the code was enacted in the 1990s, such concepts did not exist.

However, the resultant white paper has proved to be much wider and more ambitious, exactly as defenders of the existing law had feared. Among other things, the proposal:

calls for the statute of limitations for individual actions to be interrupted by the filing of a class action;

allows for the burden of proof to be shifted during sentencing; and

allows for monetary incentives to be paid to lawyers representing civil associations.

It is feared that if the proposed changes are implemented, Brazilian class actions will become more unbalanced than ever.

Detractors have also called attention to the radical nature of the proposal. Legislation should afford predictability to public life; therefore, legislation that includes unwelcome provisions is inconsistent with this purpose. For example, the proposal that the statute of limitations be interrupted by the filing of a class action merely increases uncertainty and thus extends the waiting period at the start of a dispute. This goes against the current trend to reduce such periods in order to enhance legal security.

Most worrying are the proposals to amend procedural provisions such as permitting the burden of proof to be shifted during sentencing. The existing code offers no definition as to when such a shift may occur. This has given rise to endless academic debates, with renowned experts defending that the shift should indeed take place during sentencing (which will generally negatively affect the defendant). The courts, although not always unanimously, tend to take the opposite approach, querying how a judge can state during sentencing that a party should have produced evidence despite not being responsible for the burden of proof. The shifting of the burden of proof should be an exception, not the rule. A restrictive interpretation is therefore required. If applied in line with the requirements provided by law, it must logically precede the production of evidence and not occur during sentencing, when evidence has already been (or should have been) produced. After all, a lawsuit is not (and should not be) an arsenal of traps.

It is hoped that, at the very least, this fundamental guarantee will be preserved from legislative change.

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* Fernando Dantas M. Neustein is a lawyer partner at Mattos Muriel Kestener Advogados.