The Second Section of the Superior Tribunal de Justiça (STJ, Brazil’s Superior Court of Justice) stayed pending lawsuits and will decide, under the repetitive appeals procedure, the dispute surrounding financial retention limits when real estate purchase and sale agreements are terminated. The decision, reported by Justice Ricardo Villas Bôas Cueva, applies to cases where the buyer initiates the cancellation due to buyer fault.
The Legal Issues Under Review
The questions were logged in the STJ database and divided into two distinct topics for review by the court:
- Topic 1,465: Addresses the percentage and calculation basis of amounts sellers may withhold under contracts signed before Federal Law No. 13,786/2018 took effect, commonly known as the Real Estate Termination Law (Lei do Distrato).
- Topic 1,464: Covers the retention limit specifically for purchase and sale agreements involving unbuilt land (lots or land plots) entered into after the Real Estate Termination Law took effect.
Special Appeals 2,255,394, 2,255,370, 2,255,054, and 2,255,393 were selected for this binding review. The substantial volume of cases motivated the measure. According to the Precedents, Case Law, and Class Actions Management Commission (Cogepac), the Second Section panels have already issued 53 appellate rulings and 692 individual judicial decisions on Topic 1,464, along with 133 appellate rulings and 3,615 individual decisions on Topic 1,465.
Divergence Between STJ Panels
Selecting these appeals aims to resolve conflicting legal interpretations between the court’s Third and Fourth Panels regarding the applicable percentages.
For the Third Panel, in contracts executed after the statute (Topic 1,464), the Brazilian Consumer Defense Code (CDC) must take precedence over the Real Estate Termination Law. Consequently, retention applies solely to installments actually paid, generally capped at 25% of the total amount settled, except when compensation for property use applies. For contracts signed prior to the statute (Topic 1,465), this panel permits retention between 10% and 25% of paid amounts, leaving lower courts to set the appropriate percentage on a case-by-case basis.
Conversely, the Fourth Panel holds that, for contracts executed after the statute (Topic 1,464), the provisions of the Real Estate Termination Law do not conflict with the CDC. Under this rationale, withholding up to 10% of the updated total contract value is permissible, pursuant to Article 32-A of Federal Law No. 6,766/1979. For prior contracts (Topic 1,465), the standard rule applied is a 25% retention of amounts paid, intended to cover general administrative expenses incurred by the seller and deter unilateral contract termination.
Practical Impacts and Legal Certainty
With the selection of these appeals, all pending cases addressing the same subject matter that have filed special appeals or interlocutory appeals against the denial of special appeals before second-instance courts or the STJ are stayed. The Brazilian Civil Procedure Code governs this sample-based adjudication framework in Articles 1,036 and following.
Settling this issue will enable uniform application of a single legal standard across thousands of lawsuits, streamlining repetitive litigation throughout the Brazilian court system, saving judicial resources, and delivering greater predictability for the real estate market.
This content is for informational purposes only and does not constitute legal advice. For guidance on specific matters, consult a qualified lawyer.
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