September 25 2001 New Law Creates Courts of Peace Sociedade Civil de Advogados | Litigation - Portugal Litigation Law 78 of July 13 2001 created a new agency within the Portuguese judicial system: the courts of peace. The new law aims to encourage the civic participation of all citizens and to resolve minor disputes by assisting the parties to reach agreement through a simple, informal, oral procedure.Territorial jurisdiction will be determined in accordance with the administrative authority (ie, parish) in which the courts of peace are located. The choice of law may be determined according to: where the property is located (lex rei sitae); where the wrong occurred (lex loci delicti); or where the contract was performed (lex loci contractus). Procedures will be taxed according to a table still to be issued by the Ministry of Justice.Courts of peace can only decide claims with a monetary value of up to €3,750 and arising from disputes relating to: payment of debts; delivery of goods; condominium management; boundary suits; possessory actions; petitionary actions, excluding eviction; damages; contractual liability, excluding labour contracts; securities and warranties; or liability claims based on minor crimes.Each court of peace includes an arbitration section to provide an alternative to litigation. Judges must hold a law degree and be over 30 years old. They should rule in a conciliatory manner, based upon the law and principles of equity (or just the latter, if both parties agree and the claim is for less than €1,825).Both individuals and companies may present their claims or apply for arbitration to the courts of peace, either by themselves or through a lawyer (legal representation is mandatory in the case of appeals). Both arbitration and judgment procedures are highly simplified, and court of peace decisions have the force of judgments issued by first-instance trial courts.The first four experimental courts of peace will be created by the end of 2001. The law aims to divert small claims and minor cases to these new institutions, to free up the time of the first-instance trial courts by releasing them from a massive amount of work, so that they can concentrate on hearing more significant cases with greater thoroughness and efficiency. Only time will tell whether this will be the end result. For further information on this topic please contact Henrique dos Santos Pereira or Luís Rolo at Sociedade Civil de Advogados by telephone (+351 213 712 630) or by fax (+351 213 712 631) or by e-mail ([email protected] or [email protected]). The materials contained on this web site are for general information purposes only and are subject to the disclaimer.