The Brazilian Superior Court of Justice (STJ) has set a new precedent in the judicial recovery process by ruling that, once the suspension period of executions (stay period) ends, creditors can resume their execution actions against companies in recovery, until the judicial recovery plan is approved by the general meeting of creditors and judicially homologated.
The stay period, provided for in the Judicial Recovery Law, is a 180-day period, which may be extended for an equal period, during which actions and executions against the company in recovery are suspended. This measure aims to guarantee a favorable environment for the company to develop and negotiate a recovery plan with its creditors, without the immediate pressure of collections.
However, the STJ’s recent decision established a new dynamic for this process. By determining that, after the end of the stay period, creditors can resume executing their debts, the court signals that the legal protection granted to companies in judicial recovery is not unlimited.
This decision has significant implications for both companies and creditors. For companies, it means the need to intensify negotiations with creditors and present a solid and viable judicial recovery plan, capable of convincing creditors to accept the proposals and avoid the execution of their credits. For creditors, the decision represents the possibility of ensuring the receipt of their credits, in the event of non-approval of the judicial recovery plan during the stay period.
It is important to emphasize that the resumption of executions after the stay period does not mean the end of the judicial recovery process. The company will still have the opportunity to present a recovery plan and seek its approval in a general meeting of creditors and judicial homologation (after the homologation of the plan, the credits will be novated, and the ongoing executions will be extinguished).
However, the pressure of executions can significantly influence the outcome of this process, encouraging the company to seek solutions that better meet the needs of creditors.
STJ’s decision represents an adjustment in the balance between the protection of companies in recovery and the rights of creditors. By allowing the resumption of executions after the stay period, the court seeks to stimulate negotiation between the parties and ensure that the judicial recovery process is more efficient.
This new reality requires companies in judicial recovery and their creditors to adopt new strategies and be prepared for a more dynamic and challenging scenario.
