Background
CATAGUA, a real estate developer, filed a special appeal (Recurso Especial) challenging a judgment that allowed cumulative recovery of a moratory penalty clause and lost profits (lucros cessantes) under a real estate contract. The contract, executed on February 24, 2021, provided for two distinct penalties: a 2% compensatory penalty applied once upon expiration of the tolerance period, and a 0.5% monthly moratory penalty continuing until project completion. The lower court initially dismissed CATAGUA’s special appeal as defectively pleaded because the developer failed to properly identify which federal legal provisions were violated or demonstrate the required jurisprudential disagreement (dissídio interpretativo).
CATAGUA then filed an internal appeal (agravo interno) arguing that its special appeal was properly structured around the prohibition on cumulating moratory penalties with lost profits, as established in STJ Theme 970 (REsp 1.635.428/SC). CATAGUA contended that it had cited the requisite binding precedent and thus overcome the procedural defect. The opposing party sought imposition of a sanctions fine under Brazilian Code of Civil Procedure Article 1.021, § 4º.
The Court’s Holding
The Third Panel of the Superior Tribunal de Justiça unanimously denied CATAGUA’s internal appeal. On the procedural issue, the court affirmed the dismissal under Sumula 284 analogy, holding that CATAGUA had failed to precisely indicate which federal legal provisions were violated or which provisions were subject to interpretive disagreement. The court found no sufficient allegation of formal compliance.
On the merits, the court found that the lower court correctly distinguished the case from Theme 970/STJ. The STJ’s precedent establishes that “the moratory penalty clause aims to indemnify for late performance of an obligation and, as a rule, when set at an amount equivalent to the rental value, its cumulation with lost profits is precluded.” However, the court held that this precedent did not apply because the contract itself—drafted by CATAGUA itself—expressly provided for cumulative recovery of both penalties. Under the principle of pacta sunt servanda (contracts must be honored), the contractual terms must prevail. The court emphasized that CATAGUA, as the developer and non-vulnerable party, had drafted and agreed to the contract on February 24, 2021, well after Theme 970 became final in November 2019, suggesting deliberate contractual design. The court found no contractual abusivity, as the developer—not a consumer—had negotiated and accepted these terms.
Regarding sanctions, the court rejected application of the fine under Article 1.021, § 4º of the Code of Civil Procedure, holding that such a penalty is not automatic and requires a showing that the internal appeal is manifestly inadmissible, abusive, or dilatory. The court found no such character in CATAGUA’s filing.
Key Takeaways
- Parties may contractually agree to cumulate moratory penalties and lost profits damages, notwithstanding the STJ’s general prohibition on such cumulation under Theme 970, provided the agreement is express and fairly negotiated.
- The principle of pacta sunt servanda remains foundational in Brazilian contract law and permits enforcement of contractual terms even where they diverge from general jurisprudential rules, absent demonstrated contractual abusivity.
- Procedural defects in appeals—such as failure to cite specific legal provisions or demonstrate jurisprudential disagreement—remain fatal even where a party believes it has identified binding precedent relevant to the substance.
- Sanctions for frivolous or dilatory appeals are not automatic and require an affirmative judicial finding of manifest impropriety in each case.
Why It Matters
This decision clarifies the scope and limits of the STJ’s Theme 970 precedent, which had broadly restricted cumulative recovery of moratory penalties and lost profits in real estate contracts. The holding establishes that where a sophisticated party—here, a developer rather than a consumer—expressly negotiates and accepts cumulative penalty provisions, Brazilian law will enforce those terms under pacta sunt servanda, even against the grain of established jurisprudence. This preserves party autonomy while maintaining the protective boundaries of Theme 970 for contexts involving genuine disparity in bargaining power.
The decision also reinforces that formal compliance with appeal procedures remains essential: a party cannot substitute substantive arguments about the merits for precise citation of violated provisions. Courts will not rescue appeals that fail these threshold procedural requirements, even when underlying legal claims may have merit.