The Third Panel of the Superior Court of Justice (STJ) waived the requirement of a bond (caução) for a foreign company to be able to litigate in Brazil, after proof that it is duly represented in the country.
MSC Mediterranean Shipping Company S/A filed a collection action against a Brazilian import and export firm.
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At the first instance, the proceeding was extinguished without resolution of the merits, because the plaintiff failed to make the deposit of the bond set by Article 835 of the Code of Civil Procedure of 1973, which imposes this requirement for a foreign company to litigate in Brazil if it does not have sufficient assets to bear the burden of any loss of suit.
The Court of Justice of São Paulo (TJSP) upheld the extinction of the proceeding, stating that the bond was required because the foreign company did not have proper representation in Brazil.
In appealing to the STJ, MSC Mediterranean argued that it had appointed MSC Mediterranean do Brasil as its general agent in the country, with powers even to bring legal actions in defense of its interests.
Domiciled in Brazil
According to the reporting justice, Justice Moura Ribeiro, Article 12, VIII, of the CPC/73 establishes that the foreign legal entity will be represented in court by the manager, representative, or administrator of its branch, agency, or subsidiary opened or installed in Brazil.
The justice explained that it was possible to verify in the case records that MSC Mediterranean appointed, by means of a power of attorney, MSC Mediterranean do Brasil as its general agent in the country, with an agency contract entered into between the two. According to the reporting justice, the procedural representation mentioned in the case must not be confused with commercial representation, which is a typical contractual modality.
In this way, the allegation contained in the appealed judgment — that the plaintiff is a foreign company without domicile and assets, for which reason the bond as a prerequisite of the action would be indispensable — was not justified.
“There is no reason to justify the concern regarding the eventual liability of the claimant for the burdens of loss of suit, and the application of the provision of Article 835 of the CPC/73 (Article 83 of the New CPC) is not justified, since, as seen, MSC Mediterranean must be considered a business company domiciled in Brazil and its representing agency, MSC Mediterranean do Brasil, may respond directly, should it be defeated in the action, for any charges arising from loss of suit,” he stated.
Moura Ribeiro ordered the return of the case records to the court of origin so that it may proceed with the ruling on the collection action without the requirement of the bond.
Source: STJ
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