The Second Section of Brazil’s Superior Court of Justice (STJ), under the repetitive appeals procedure (Theme 1,261), has established important guidelines on the seizure of family homes, providing greater legal clarity and security to both creditors and debtors.
See the main points of this decision:
1. Exception to Exemption Only Applies If the Debt Benefits the Family: The STJ ruled that the exception allowing the seizure of a family home, in cases of foreclosure on a property mortgaged by the couple or family entity, only applies if the debt was contracted for the direct benefit of the family. In other words, the mere existence of a mortgage does not automatically remove the protection granted to the residential property.
2. Specific Rules on the Burden of Proof: The court differentiated two situations regarding the burden of proof: (i) If the property is mortgaged by one of the partners of a company: the family home is generally exempt from seizure. The creditor must prove that the company’s debt benefited the family. (ii) If the only partners of the company are also the owners of the property: the home can be seized, unless the owners themselves can show that the company’s debt did not benefit the family entity.
3. Family Home Protection Is Not Absolute, and Good Faith Must Prevail: The STJ reaffirmed that the protection of the family home is designed to guarantee the fundamental right to housing, but it cannot be used inconsistently or to unfairly frustrate creditors’ rights. Thus, it is not acceptable for a debtor to try to remove the property from liability after offering it as mortgage collateral, especially in contracts signed for the family’s financial stability.
The STJ’s decision reinforces the protection of the family home but establishes clear exceptions, upholding principles of good faith and discouraging contradictory conduct. This precedent will bring more security to enforcement and contracts involving residential properties as collateral.
