The recent decision by Brazil’s Superior Court of Justice (STJ) concerning the extrajudicial exclusion of a business partner offers important clarification—and reassurance—for business owners, legal advisors, and foreign investors operating under Brazilian corporate law.
At the heart of the case was a procedural challenge: can a partner be excluded from a company based on a document that was signed by all members but not formally registered with the Junta Comercial (Brazil’s commercial registry)? The STJ’s answer: yes—provided certain conditions are met.
🔍 Core Legal Insight: Formalism vs. Private Autonomy
The STJ ruled that a unanimously signed corporate statute—though unregistered—may validly amend a company’s contractual framework for internal purposes. This position reflects a balanced approach: safeguarding the substantive will of the partners while preserving third-party protection through the registration requirement.
The Court’s analysis centered on Article 1.085 of the Brazilian Civil Code, which requires explicit contractual provision for the exclusion of a partner. However, Justice Ricardo Villas Bôas Cueva emphasized that the statute in question, despite its name, functioned as a contractual amendment and satisfied all necessary legal formalities.
In short, Brazilian jurisprudence recognizes a distinction between internal enforceability (between partners) and external enforceability (towards third parties), a nuance that is crucial for business planning in Brazil.
⚖️ Practical Relevance for Companies and Advisors
This decision has meaningful consequences in both transactional practice and corporate litigation:
- Internal governance flexibility
Companies can adapt and evolve their contractual arrangements without immediate bureaucratic hurdles, provided there is unanimous consent and proper documentation. - Importance of substance over form
The Court prioritized the content and unanimous execution of the statute over its nomenclature or lack of registration. This may encourage partners to formalize adjustments promptly—even before navigating the sometimes sluggish commercial registry. - Risks if consensus is not unanimous
The ruling hinges on the existence of full agreement among partners. If even one dissenting voice had existed, the document would likely have lacked internal validity. Hence, caution is warranted when amending structural aspects of a company without universal approval. - Implications for partner exclusion clauses
The decision supports the enforceability of extrajudicial exclusion mechanisms, as long as they are clearly agreed upon. This strengthens partner accountability and may reduce litigation risks in well-governed businesses. - Strategic use of separate instruments
Companies may consider using distinct instruments—such as bylaws, shareholder agreements, or governance protocols—to supplement their articles of incorporation, especially in closely held or family-run businesses. The STJ ruling provides reassurance that, when properly executed, such documents can carry real legal weight.
📉 Limitations and Cautionary Notes
While the decision promotes legal certainty, it should not be misread as carte blanche for informal governance. Lack of registration still impairs the effectiveness of amendments against third parties, and companies may face challenges in proving the authenticity or scope of internal agreements in court if disputes arise.
Moreover, overreliance on unregistered instruments can invite tax, regulatory, or compliance complications, especially where corporate transparency is required—for example, in due diligence or cross-border transactions.
🧩 Final Takeaway
The STJ’s decision represents a mature interpretation of Brazilian corporate law, privileging the genuine intent of business partners over unnecessary formalism. It offers reassurance that private autonomy remains a pillar of corporate governance, particularly in the internal dynamics of Brazilian sociedades limitadas (limited liability companies).
However, prudence demands that such flexibility be exercised responsibly—with clear documentation, legal advice, and prompt regularization of changes before public registries. For investors, legal counsel, and corporate executives alike, this precedent marks an evolution in how internal corporate arrangements are viewed by Brazil’s judiciary.