In a recent decision, the 4th Panel of the Superior Court of Justice, in the Special Appeal No. 1.804.804/MS, reaffirmed that Judicial Reorganization by one of the jointly and severally liable debtors does not prevent the collection from the other jointly and severally liable debtors that are not under reorganization.
In this case, a consortium was formed for the supply of goods and services, in which one of the consortium companies is under Judicial Reorganization, a situation in which the continuation of actions and executions against the company is prevented.
However, regarding to the consortium companies that are not under Judicial Reorganization, the Superior Court reaffirmed the possibility of collecting the debt against them, as provided for in article 49, paragraph 1, of Law 11101 of 2005 (Judicial Reorganization and Bankruptcy Law).
However, regarding to the consortium companies that are not under Judicial Reorganization, the Superior Court reiterated the possibility of collecting the debt against them, as established in article 49, paragraph 1, of Law 11101 of 2005 (Judicial Reorganization and Bankruptcy Law).
In addition, the decision stated that this understanding is consolidated in Precedent No. 581 of the Court, according to which “judicial reorganization of the principal debtor does not prevent the continuation of actions and enforcement filed against third-party jointly and severally liable debtors or co-obligors in general, for exchange, real or fiduciary guarantees”.
With this decision the Superior Court partially granted the special appeal, to allow the continuation of the enforcement against the jointly and severally liable debtors.
