When Only Brazilian Courts Rule

Got a dispute? Check the contract. There’ll likely be a forum clause that says where lawsuits must be filed. But perhaps there isn’t a contract. And in some cases, despite what the contract says, a claim must be filed in Brazil.

There are three general types of cases where Brazilian courts have sole jurisdiction. They’re certain real estate matters, inheritance matters, and family law matters.

The transfer of real estate is governed by Brazilian law. After all, ownership only changes hands once the deed is registered with a notary in Brazil. The same is true for lawsuits related to real estate.

Inheritance matters are also a matter of Brazilian law. Only Brazil can authorize the distribution of Brazilian assets that are part of a deceased's estate. Hence, the heirs will only receive their share of the estate after the matter is brought before a Brazilian judge. It makes no difference if the deceased was an American living in the US. What matters is where the assets are located.

Finally, only a Brazilian court can rule in cases of divorce or dissolution of a união estável if the spouses have adopted a common property marital regime. Why? Because the court will likely need to split assets that are located in Brazil.

If you’re planning on acquiring assets in Brazil, make sure you’ve considered the fact that disputes must be resolved in Brazil. Your typical asset protection structure might not work as you originally imagined, so plan ahead and consider seeking professional advice.