The ticking time bomb of the statute of limitations

prescrição intercorrente

A change in the wording of art. 921 of the Code of Civil Procedure (“CPC”), resulting from Law 14.195/2021, may be putting enforcement and enforcement of judgments in Brazil at a critical crossroads.

There is an imminent risk that, as of 2026, all stagnant proceedings backed by debts based on public or private instruments, or without the location of attachable assets, could be extinguished. This will have a significant impact on the volume of executions and enforcement of judgments in the country.

The whole issue revolves around the inter-current statute of limitations, which ensures that creditors cannot indefinitely continue to collect from debtors while they remain inactive during the proceedings. In simpler terms, it imposes a deadline for the creditor to take the necessary measures to continue the process and satisfy their claim. If they fail to do so, they may lose the right to continue demanding payment in court. In this way, the Judiciary protects debtors from endless lawsuits and eliminates processes that are not very effective.

The intercurrent statute of limitations aims to balance the legal system, ensuring that lawsuits are kept active and that the parties involved, especially creditors, do not benefit unduly from their inertia.

What is happening now is that, although the change in the Civil Code provides greater clarity as to the start of the interlocutory limitation period – which becomes the knowledge of the first unsuccessful attempt to locate the debtor or attachable assets – there is a tightening of the hypotheses for interruption of the limitation period.

After the legislative change, the Superior Court of Justice held that the new statute of limitations does not apply retroactively and the new time limits only apply from the date of publication of the law, preserving the principles of legal certainty and procedural good faith.

To illustrate the potential impacts of this measure, it is important to look at the data available on the National Council of Justice ‘s (CNJ) Judicial Branch Statistics Panel.

As of June 30, there are more than 7 million foreclosures pending judgment in the state courts. To put this into perspective, this represents just over three cases for every 100 Brazilians. Furthermore, many of these unfinished cases have been active for more than three years.

Therefore, given the large number of cases and the length of time since the majority of foreclosures were filed, it is reasonable to predict that, as 2026 approaches, many of them could be extinguished without the foreclosed claims having been satisfied.

Although the future is uncertain, it is undeniable that we are entering a delicate period when it comes to collecting legal debts. Intercurrent prescription will represent a major challenge for creditors, debtors and lawyers, who will need to act diligently to ensure that their rights are preserved.

In summary, while the change brought about by Law 14.195/2021 is necessary to provide greater clarity, it also creates a challenging scenario. Lawyers and parties need to be prepared to face the effects of this change, avoiding the extinction of cases or the collection of undue amounts. The clock is ticking and proactive action will be essential in the coming years.

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