We invite you to read the column written by our associate of the Civil Litigation and Arbitration Group, Job Jorquera, and associate of the Public Law and Regulated Markets Group, Felipe Giovanazzi, on damages for abuse of rights.
The passage of time in law not only brings with it new understandings regarding some concepts or institutions to which we lawyers tend to resort on a daily basis. It also brings – as far as we are interested in this article – the application of new judicial strategies.
Thus, it has become more frequent that, in order to seek a solution to a given conflict, strategies based on the filing of multiple legal actions, before different jurisdictional bodies or venues, are proposed to cover the different areas of the problem.
Although the universal right to access to justice and to be able to make use of the tools provided by our judicial system for such purposes is undeniable, it is no less true that a percentage of these strategies may ultimately present a motivation that escapes the purposes intended by our legal system, using actions and resources with the sole intention of intimidating a counterparty, unjustifiably improving a negotiating position, taking advantage of an imbalance of assets between the parties to solve costs, among others.
This becomes even more delicate when these actions are accompanied by an aggressive communication strategy, which may tarnish the image of the party affected by these legal actions, especially in cases of companies or individuals who have a reputation that is essential for the development of their business or personal life.
In this sense, the following question arises: is there any limit to be respected for the filing of legal actions? In response to this question, the study of the so-called theory of abuse of rights has arisen in order to regulate situations such as those described above.
Indeed, although this problem has been expressly dealt with in matters of free competition – penalizing those conducts that constitute a “manifestly abusive exercise of legal actions with the purpose of hindering the operation of a market agent ”1 -, the fact is that there is no rule or supplementary figure for this specific issue that would allow its application in other branches of law.
There is a certain tendency to understand that, in the face of the filing of legal actions that lack legal grounds or are far from the purpose established for them by our legal system, the only applicable sanction for the reckless litigant would be the respective sentence in costs, a matter that would come to “punish” his conduct.
However, it is public knowledge that, in most cases, such conviction ends up being a symbolic sanction that, in practice, in no way discourages the congestion of our courts of justice with instrumental actions.
Therefore, we believe that it is imperative to go a step further, and a harsher sanction criterion should be established in view of the evident damages, both patrimonial and non-patrimonial, that this type of practices may entail.
Fortunately, our most influential doctrine has shed light on this important matter. Professor Enrique Barros, in the most recent version of his Treatise on Extracontractual Liability, has framed those abusive uses of our judicial apparatus as causes of extracontractual civil liability, enabling the person who suffers the damage to demand the pertinent compensation for damages, stating that:
“these cases referred to by the law must be understood as included in the more general civil tort of abusive exercise of judicial actions; this includes abusive conduct in the matter of procedural remedies when they clearly only have the purpose of delaying the factual situation favorable to the party filing them, the obstruction of free competition, the hindering of a competing agent in the market and, in general, any action attributable to bad faith or reckless negligence on the part of the party causing the damage “2.
Fully sharing the criteria of Professor Barros, we believe that whoever instrumentalizes judicial actions and our courts causing damages to those who are affected by such instrumentalization, should always be compensated, with amounts that effectively reflect and sanction this abusive conduct. This should be the trend in judicial forensic practice, as it would be the most immediate or “handy” mechanism available to discourage -and sanction- the filing of actions for directly abusive purposes.
However, the most efficient solution, in our opinion, would be to think of a legislative amendment to our Civil Code that would expressly incorporate this conduct as one of those punishable by means of the respective compensation for damages.
Perhaps this is the moment for an effective legislative impulse in these matters and thus expressly discuss and consecrate also other theses of wide treatment -and, in some cases, judicial recognition-, such as the revision of contracts due to change of circumstances at the time of contracting, the compensation for loss of chance, the autonomy of the action for damages, among others.
Column written by:
Job Jorquera | Associate, Civil Litigation and Arbitration Group | jjorquera@az.cl
Felipe Giovanazzi | Associate Public Law and Regulated Markets Group | fgiovanazzi@az.cl
