Stuck in Court for Forty Years

It’s no secret that litigation in Brazil is slow. Even routine disputes can spiral into decades-long sagas thanks to an overburdened court system and seemingly endless appeals. One labor case offers a startling example: a dispute that took more than 40 years to resolve.

In 1982, a former bakery manager sued his employer, a supermarket in Salvador, Bahia. The case dragged on for decades until this year. It ended not with a court ruling, but with a settlement. The company agreed to pay the former employee BRL$4 million (almost US$700,000), plus attorney’s fees and court costs.

The case is extreme but not all that unusual. Brazil’s legal system allows for multiple levels of appeal, and the courts are notoriously congested. According to recent statistics, labor courts handled over 2 million new cases last year. That volume overwhelms even the most efficient judges.

But this isn’t just a cautionary tale about employee disputes. It highlights the broader challenges of litigating in Brazil and underscores the importance of structuring deals to avoid court altogether. For example, including an arbitration clause in a contract could keep you out of the court system entirely.

When doing business in Brazil, the real cost of a dispute isn’t just the financial outcome - it’s the time, stress, and uncertainty that come with protracted litigation. While not every dispute can be avoided, a proactive approach to risk can go a long way. In Brazil, staying out of court may be the biggest win of all.