Brazilian Justice Can’t Reach Goals of Working Faster and Spending Less

    Justice statue in Brasília

    Justice statue in Brasília In Brazil, at the beginning of last year, the Brazilian Judiciary branch set itself two ambitious goals: it was going to rule on all lawsuits dating from before 2006. And it was also going to reduce operational costs.

    According to a report by the Applied Economics Research Institute (Ipea), final judgments were issued in only 44.5% of cases that went to court before 2006 and Judiciary branch operating expenses rose 17% in 2010.

    The bright note was a certain alacrity in judging more recent cases. 2010 was an election year and the electoral courts managed to judge all the cases they got in 2010, plus a small backlog from prior years. The same was true in appeal cases (“tribunais superiors”) and Labor Courts.

    However, a serious problem remains in collecting fines and other assessments. There are reportedly 23.5 million of these cases outstanding. In 2010, only 40% of those cases were dealt with.

    On the average, these cases take 2,989 days to resolve in court – that is, eight years, two months and nine days. The average cost of such a lawsuit is 4,368 reais (US$ 2706) while the average amount involved is 22,500 reais (US$ 13,940).

    Slightly less than 60% of these cases are filed by federal authorities (Procuradoria-Geral da Fazenda Nacional) or (Procuradoria-Geral Federal). At the same time, around 30% of all lawsuits seeking payment come from liberal professional associations (they may be after dues from members; tuition; or some kind of fees).

    Interestingly, the Ipea survey found that court functionaries are often so deeply involved in procedural or bureaucratic tasks that they do not have any interest in resolving cases. In other words, their main concern is with the process rather than the final result.

    “This is a question of mentality,” says Alexandre dos Santos Cunha, a research expert at Ipea. “The team that deals with these lawsuits must be committed to results – that is, a final result. The federal judiciary branch has highly qualified people but unfortunately their talent is often wasted.”

    Government and Banks

    The National Justice Council (CNJ), a judicial branch watchdog, has just released a list of corporations and institutions involved in litigation at the federal level.

    It turns out that 38% of the lawsuits in federal courts involve the federal government and another 38% involve banks. In other words, together the government and banks are involved in 76% of all federal lawsuits.

    The survey also found that 8% of federal lawsuits involve state governments, 6% telephone companies and 5% city governments.

    In a general national ranking of litigants, the grand champion, with 22.3% of all legal processes, was the federal government’s Social Security system (INSS). In second place was the Federal Loan and Savings Bank (Caixa Econômica Federal) with 8.5%, followed by Fazenda Nacional (tax issues) with 7.4%.

    It should be noted that at the top of all the lists are government institutions. It is only further down that private institutions begin to appear.

    Bradesco, a private bank, with 3.8% of cases, is in seventh place; Banco Itaú, with 3.4% is in eighth place; Brasil Telecom, with 3.3%, is in ninth place and Banco Finasa with 2.2%. is in tenth place.

    A deputy secretary at the CNJ, José Guilherme Werner, pointed out that when the survey separated those who sued from those who were being sued, a curious fact was discovered: banks (both private and state-run institutions) sue as often as they are sued.

    However, in the vast majority of cases it is involved in the federal government is sued. While at the local level, 97% of lawsuits are filed by municipal authorities.

    Werner announced that there are plans for a gathering of Brazil’s biggest litigants in May in São Paulo. The objective of the meeting (which is being billed as a seminar), says the deputy secretary, is to unclog the dockets a little.

    According to Werner, people are beginning to perceive the costly burden of the law’s delay. “It is becoming apparent that the faster a lawsuit is resolved, the better – for both sides,” declared Werner.

    The May seminar will take place against the background of a movement to create the 3rd Republican Pact in which representatives of the three branches of government will adopt measures to reduce litigation at the federal level.

    ABr

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