Brazil’s STJ rules on payment of attorney’s fees in motions to pierce the corporate veil

On February 13, 2025, the Special Court of the Superior Court of Justice (STJ) – Brazil’s highest court for interpreting infra-constitutional law – ruled on Special Appeal No. 2,072,206/SP. By a six-to-three majority, the court decided that attorney’s fees are due when a motion to pierce a company’s corporate veil is dismissed or denied, even if filed via ancillary proceedings.

Brazilian procedural law does not expressly provide for attorney’s fees in ancillary proceedings, which address incidental issues arising during the course of a lawsuit. However, the court acknowledged that a motion to pierce the corporate veil requires a defense effort comparable to that of a principal claim, as it seeks to extend liability to a third party. The majority opinion, authored by Justice Ricardo Villas Bôas Cueva, therefore held that attorney’s fees are still due even when such a motion is dismissed or denied.

As established by law, attorney’s fees are amounts the losing party owes to the prevailing party’s attorney, typically ranging from 10 to 20% of the amount under dispute. They are distinct and independent from contractual fees, which are privately negotiated between attorneys and their clients.

While the ruling affirms attorney’s fees are applicable in such cases, the court also noted that future decisions may further refine how they are quantified. In particular, the court acknowledged that fees could be set based on equitable considerations – allowing judges the discretion to determine the attorney’s fees according to the complexity of each case and the work carried out by the attorneys rather than adhering to strict arithmetic parameters.

This decision marks a departure from the previous prevailing position, which held that no attorney’s fees were due in ancillary proceedings to pierce the corporate veil.

For more information on the subject, please contact Mattos Filho’s Litigation & Arbitration practice area.