Litigation in Peru
Peru has one of the fastest growing economies in the world and more people than any U.S. state besides California. Its legal system, however, is relatively new and very interesting.
To learn more about it, I asked my former colleague Sheila Giuliana La Serna Jordan. Sheila used to practice law with me at Becker Glynn in New York, but now she is the chief legal and compliance officer of Profuturo AFP, the Peruvian pension fund manager and subsidiary of Scotiabank.
Why should you continue to reason this post about litigation in Peru?
You read some of this blog’s other posts about litigation in the hispanohablante world and were interested about how Peruvian courts differ from those in Spain and Mexico.
You are interested to hear a perspective on litigation from someone who works in-house at a company instead of for a law firm.
You would like to know about the Lima bar’s special attire.
Background
This interview has been lightly edited.
Can you tell me about the kinds of disputes you handle in your legal practice?
Besides collection proceedings, we work on arbitration, judicial proceedings, tax-related litigation, and constitutional, labor, and pension-related proceedings.
Besides Microsoft Office, what software do you use in your practice?
We use a tailor-made software platform to track collection proceedings.
What books and websites do you use for legal research?
We use specialized books and law journals.
Also, we use judicial precedents from available sources, such as from the official gazette, El Peruano.
Do you electronically file pleadings with the court? Or must you send paper copies of them to the courthouse?
Recently our courts have implemented electronic filing. It is called Mesa de Parte Electronica and it is accessible here: https://casillas.pj.gob.pe/sinoe/login.xhtml
Generally speaking, how many pages are the complaints or initial pleadings you see in your work?
It depends on the matter.
The complaint in an execution proceeding or proceso unico de ejecución (to enforce a previous judicial decision or a payment obligation that is included in a check or promissory note) or a non-contentious proceeding or proceso no-contencioso (such as a request for the correction of a personal registry name), would probably be shorter.
The complaint in constitutional proceedings are likely longer. These proceedings are carried out before the Constitutional Tribunal, which is a high-level authority that interprets the Constitution.
Contractual and civil law complaints could easily be 200 hundred pages, if not more, even without the additional pages of evidence attached to them.
Generally speaking, how long does it take for a case to go from complaint to judgment?
In the best case scenario, it takes about one and a half years for judgments in the trial court for “fast-track proceedings,” like execution proceedings (to collect assets from a debtor) or amparo actions, which are constitutional proceedings in which a party asks the court to stop an actual or threatened violation of a constitutional right.
In the worst case scenario, it takes about seven years, including the trial court and the two levels of appeals at the Superior Court and the Supreme Court.
I understand that Peru has specialized courts that only hear commercial cases. What makes this court better able to handle commercial disputes? Does it have special judges or procedures?
Commercial courts were created in 1994 and implemented between 2004-2005. Since then, there has been a great effort to train our judges in financial and banking, free competition, consumer protection, and corporate and commercial law. This effort has included the cooperation of USAID and different Peruvian governmental and non-governmental entities. Hence, the main difference between these courts and other courts is their special knowledge and not their procedures.
Who decides the facts in a commercial case? Is it a judge or a jury?
A judge. We do not have a jury system in Peru.
We do have, however, the intervention of the Public Minister in some family and minor-related cases. That office acts as a representative of the Peruvian society.
Generally speaking, how is evidence exchanged between the parties before trial? Do you get to interview the opposing witnesses before the trial?
Not at all. We introduce evidence with the complaint and the judge determines whether evidence is useful to clarify the controversy and prove the facts. The testimony of the witness is “offered” in the complaint and, if the judge admits it, then you will be asked to interview him or her at a hearing called an audiencia de pruebas.
There is also a possibility to file a request before the regular hearing to interview your own witness for “anticipated evidence” if there is an emergency travel or health emergency.
If you win, does the other side reimburse your attorneys’ fees?
Yes, unless the judge finds a necessity to grant an exemption to the defeated party, such as when that party is impoverished. The government, however, does not reimburse attorneys’ fees as a matter of law. Moreover, plaintiffs in child support claims, which are called alimentistas, and in amparo actions are also exempted from such reimbursement.
Are the Peruvian courts open to the public? Can ordinary people watch a commercial trial?
Yes. The only cases that are not public are criminal cases, cases involving intimacy rights, and cases involving national security.
Do you believe that Peruvian courts have a particular strength for resolving commercial disputes? How about a weakness?
My view is that Peruvian commercial courts have recently gained useful expertise.
Also, generally speaking, Peruvian courts are relying more on computers, which is good. But the digitalization trend (including going paper-less) faces challenges in expanding more widely throughout the country.
How often do you go to the courthouse? When you are there, do you need to wear a special robe or wig?
Nowadays, we are not conducting in person meetings; the judiciary is using Google Meet for hearings and interviews.
As a Lima Bar practitioner, the use of a medal with the star symbol of the institution and a sky blue strap in hearings is required.
You work in Peru’s Private Pension Fund Industry, and you once told me that the industry may handle 800,000 collection proceedings. Why are there so many?
Peruvian private pensions have a mandatory obligation to file actions against employers to collect pensionary debt on behalf of their clients. Just to give you an example, during June 2019, an industry associationreported that there were 93,290 private sector employers who failed to pay the pensionary contributions of their employees. And each of them had at least four judicial proceedings in connection with those failures. Plus, these numbers do not reflect public sectors employers, which also contribute to the number of proceedings.
In all, the total amount of pensionary debt was around US$4,019,552,058.82 in June 2019. The widespread failure to pay these debts has several causes. They include employers’ limited access to financing sources and smaller employers’ difficulties with adminsitrative and accounting procedures.
Although pensionary rights are not subject to a statute of limitations, private pension funds have maximum terms to file actions, which range from 30 days to 8 months, depending on the type of debt, and they take seriously their fiduciary duties to file actions timely.
Another reason why there are so many claims is that there are certain judicial rules that do not allow private pension funds to consolidate claims, so they are unable to file an action on behalf of a whole group of employees from the same company.