When a debt is documented in a valid legal instrument and the debtor fails to pay, Brazilian law offers a procedural mechanism known as ‘execução de título extrajudicial’ or enforcement of an extrajudicial title. This procedure is designed to streamline the recovery of certain debts without the need for a full judicial lawsuit. Instead of initiating an ordinary legal claim, the creditor can begin an enforcement action using the instrument itself as evidence. This legal approach is vital for creditors who seek efficient debt collection. It’s widely used in cases involving promissory notes, checks, contracts, and other recognized legal documents.
Understanding the Concept of Execução de Título Extrajudicial
Execução de título extrajudicial is a legal action that aims to enforce a non-judicial document that contains a clearly determined, enforceable obligation. These documents must fulfill the formal requirements stated in the Brazilian Code of Civil Procedure (CPC), particularly topics 784 and 798. Once the document qualifies as an enforceable title, the creditor may demand payment or performance without litigating the validity of the debt.
Main Characteristics
- The debt must be liquid, certain, and enforceable.
- The creditor must present the original or authenticated copy of the extrajudicial title.
- The judge is not required to examine the merit of the obligation, only its legal sufficiency.
Common Types of Extrajudicial Titles
Brazilian law recognizes several types of documents that may serve as extrajudicial enforcement titles. These are instruments that independently carry legal force, even though they are not the product of a prior court judgment.
Promissory Notes
Promissory notes are among the most common extrajudicial titles. These are written promises to pay a specific sum of money at a designated date or upon demand. They typically include the debtor’s signature and the due date, making them directly enforceable in court if unpaid.
Checks
A check that is dishonored for insufficient funds or other reasons can be used as a title for enforcement. Creditors can file an execution action once the bank returns the check and the grace period lapses. The court does not investigate the cause behind the dishonored check it only confirms that the check exists and remains unpaid.
Extrajudicial Contracts Signed by Two Witnesses
Contracts that stipulate a monetary obligation and are signed by at least two witnesses qualify as extrajudicial titles under Brazilian law. For example, a loan agreement or a lease contract containing a specific payment clause can serve as a basis for an enforcement action if the debtor defaults.
Public Deeds of Debt Recognition
Public notaries may record a formal confession of debt, often used in settlements or refinancing agreements. These public deeds are considered enforceable titles, provided they clearly identify the obligation and the parties involved.
Legal Process of Execução de Título Extrajudicial
The execution of an extrajudicial title follows a specific procedural path that accelerates the creditor’s access to judicial enforcement tools. This process involves the judiciary but does not require a full trial, unless the debtor contests the claim.
Initial Petition
The process begins with a petition submitted by the creditor, which includes:
- Identification of the parties (creditor and debtor)
- The enforceable extrajudicial title as evidence
- A request for the debtor to fulfill the obligation or, alternatively, the seizure of assets
Judicial Notification
Once the court accepts the petition, the debtor is formally notified and given a short period (usually three business days) to comply with the obligation such as making the payment or to present a defense known as embargos à execução.
Failure to Pay or Contest
If the debtor neither pays the amount due nor presents a defense within the allotted period, the court may authorize the seizure of assets, garnishment of bank accounts, or other enforcement measures, including the auctioning of the debtor’s property.
Presentation of Embargos
Should the debtor contest the enforcement action, the process enters a more complex phase. The court will analyze the legal arguments presented, which may involve the invalidity of the title, payment already made, or lack of jurisdiction. Even in such cases, the process tends to be quicker than ordinary lawsuits.
Advantages of Using Execução de Título Extrajudicial
This type of enforcement offers numerous benefits for creditors seeking to recover debts more efficiently:
- Shorter procedural timelines compared to regular lawsuits
- Reduced legal costs and judicial congestion
- Immediate access to enforcement tools like property seizure
- Lower evidentiary burden, since the obligation is presumed valid
Real-Life Examples
Commercial Lease Agreement
A shopping mall enters into a lease agreement with a retail tenant. The contract includes a fixed monthly rent and is signed by two witnesses. After multiple months of non-payment, the mall management initiates execution proceedings based on the contract. Within weeks, the court orders the freezing of the tenant’s business bank accounts to recover the unpaid rent.
Check Returned Due to Insufficient Funds
A construction supplier accepts a check from a developer as payment for building materials. The check is returned due to insufficient funds. The supplier presents the check as an enforceable title and files a motion in court. The judge grants the request and allows the creditor to seize a portion of the developer’s real estate assets.
Confession of Debt in Notarial Instrument
A debtor agrees to sign a public document before a notary, acknowledging a debt of R$50,000, with payment due in 30 days. The debtor fails to pay. The creditor submits the public instrument as an extrajudicial title and promptly obtains court approval to block the debtor’s car and initiate enforcement proceedings.
Challenges and Considerations
Despite its efficiency, execução de título extrajudicial is not without limitations. Creditors must ensure that the document fulfills all legal requirements; otherwise, the court may reject the petition. Additionally, debtors often attempt to delay proceedings by filing embargos, claiming that the debt is incorrect, expired, or already paid.
Creditors must also be aware of the statute of limitations, which generally ranges from 3 to 5 years depending on the nature of the document. Missing this deadline can nullify the right to enforce the title.
Execução de título extrajudicial remains a powerful legal tool in Brazil for efficient debt recovery. By allowing creditors to bypass lengthy litigation, it reinforces the value of written agreements and financial instruments. Whether dealing with dishonored checks, unpaid commercial leases, or confessed debts, this process empowers individuals and businesses alike to safeguard their financial interests through structured judicial support. To ensure success, creditors should consult with legal professionals to properly format and document the enforceable titles from the outset.