Litigation & aDR annUaL REpoRt
An alternative work-in-progress
Recent years have seen profuse
regulation of Portugal and
Spain’s ADR systems, with a
clear target of boosting these
methods and offloading cases
from the Courts and Tribunals.
But there is still a long way to go
before ‘alternative’ is on an equal
footing with ‘conventional´.
the amounts in dispute in each case. The
explanation could be that companies
have tightened their legal budgets during
the years of economic difficulties and
have tried to avoid litigation in cases
of less importance, which could be
settled, says Mercedes Fernández,
Managing Partner and Head of
Disputes at Jones Day, Spain.
“From an international
litigation perspective, we
expect the number of internal
and regulatory investigations
to increase this year,” says Rafael
Murillo, Litigation and ADR Partner at
The economic and financial situation of
Freshfields Bruckhaus Deringer, “while
the last few years has acted as a doubleworries over whistleblowers allegations
edged sword towards the amicable
will continue, personal injuries are on the
settlement of disputes. On the one hand,
rise, particularly in the US, and financial
clients look with more interest to the
disputes will continue to grow in number
possibility of reaching a cost effective
and value.”
settlement, rather than involving
In Portugal, lawyers have witnessed an
themselves in cost and time consuming
exponential increase in disputes related
litigation, explains Guillermina Ester,
to financial products and investments,
Arbitration & Commercial Litigation
explains João Duarte de Sousa, Head of
Partner at Pérez-Llorca. “On the other, it
is harder to reach such settlements due to Litigation and Arbitration at Garrigues
the difficulty for parties to pay significant Portugal. “Therefore financial and
banking litigation is boiling as opposed to
amounts of money to settle a dispute.”
other periods when the financial cycle ran
An increasing number of companies
less troubled and more quietly.”
across the peninsula are warming to
The economy still creates an accrual
the advantages of solving their disputes
of work and increase of disputes –
through arbitration and are less reluctant
contractual liability cases, for example,
to include arbitration clauses in their
either through litigation or through
agreements, explains. João Duarte
arbitration, says Joaquim Shearman
de Sousa, Head of Litigation and
Arbitration at Garrigues Portugal. “It is an de Macedo, Co-head of the Dispute
Resolution Practice at CMS Rui Pena
understandable process that comes from
& Arnaut. “This flows from the fact
the common frustration with national
that parties face accruing difficulties in
court systems.”
observing its contractual obligations and
eventually are led or forced to breach the
Litigious trends
The economy continues to drive Portugal contract.”
Many market actors have adopted
and Spain into even more contentious
more conservative strategies,
times. But it has also brought a number
implemented, namely through the
of interesting opportunities, particularly
creation of provisions for doubtful debts.
in insolvency, restructuring and debt
Such behaviour allows a brand new
enforcement litigation, disputes on
approach to litigation, in which claimants
miss-selling of financial products, and
tend to accept rather significant haircuts
employment matters, essentially through
in exchange for a quick resolution of the
lay-offs and collective dismissals.
case and, consequently, the payment of
In Spain, there is a greater tendency
amounts that, being already provisioned,
for purely commercial litigation matters,
can significantly improve the creditor’s
such as unfair competition, breach of not
performance, explains João Pimentel,
merely financial contractual obligations
Head of Litigation and ADR at Campos
and intellectual property rights, and
Ferreira Sá Carneiro & Associados.
less of breach of payment obligations or
insolvency in general, explains Fernando
Arbitrary advances
González, Head of Litigation at Squire
The 2012 amendment to Portugal’s
Sanders, Madrid.
Arbitration Law substantially changed
Lawyers are also seeing an increase in
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January / February 2014 • IBERIAN LAWYER • 37