Limited impact of Covid-19 on Uruguayan litigation

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Soledad Díaz
Ferrere, Uruguay
sdiaz@ferrere.com

Agustina Rodriguez
Ferrere, Uruguay
agrodriguez@ferrere.com

In response to the coronavirus pandemic, the Uruguayan government initially issued legislation and orders closing courts and staying local proceedings. Activity later resumed (around mid-May) and courts are now working in a reasonably ‘normal’ fashion in a context where the health situation in Uruguay has been under control (with a peak of approximately 300 simultaneous cases so far).

Pursuant to Law No. 19,879,[1] Decree No. 93/2020,[2] Resolutions No. 12, 16 and 17[3] issued by the Supreme Court of Justice, and Resolution No. 8[4] issued by the Court of Administrative Litigation (parallel to the Supreme Court but for certain administrative law matters) between 19 March and 19 May 2020, a judicial health recess began. Courts remained mostly closed, with the exceptions of criminal and family courts which continued handling urgent matters (including criminal prosecutions and domestic violence). Civil courts maintained very little activity, hearing only actions seeking injunctive urgent relief in protection of constitutional rights (under Uruguayan Injunctive Relief Act 16,011). Hearings in pending proceedings were postponed, as was attendance at courts for other matters, such as to review case records.

Courts began resuming some activities during May, and from 19 May 2020 onwards in-person hearings started to be rescheduled – albeit with restrictions, proper social distancing and other sanitary measures (eg, mandatory use of face masks and a limitation to one attorney per party). Online hearings were allowed.

Although the courts did not close for long, particularly compared to other countries, it nonetheless caused disruptions, mostly due to some inherent features of the Uruguayan court system.

First, civil courts (which deal with all contract and commercial matters as well as malpractice suits and civil litigation in general) were already overloaded. Hearings in a case were normally scheduled months apart. After more than two months without hearings and another two months with reduced activity (as courts cannot set back-to-back hearings on a single day due to social distancing and the need to clean hearing rooms), proceedings began to fall behind. To partially catch up, on 3 June 2020 the Supreme Court of Justice (in Resolution 43/2020[5]) ordered that the ordinary judicial recess that takes place annually between 1 and 15 July would not apply this year and courts continued working over those two weeks. This mitigated part of the impact of the March-May closing but did not correct it altogether.

Second, there is no electronic filing of motions and evidence in Uruguay. Hard copies need to be delivered and withdrawn from courts for every submission made. Therefore, the court closure also disrupted the written phase of proceedings. There is no online case record either. The closure and the limited activity of the courts meant that litigators faced limitations in accessing the cases they handled, including in obtaining rapid access to other parties’ submissions and to the procedural decisions rendered. This demanded very aggressive tracking of the cases at court when possible and via the limited information available online, so as to avoid waiving procedural objections or other rights or remedies.

Initial measures taken to deal with the pandemic

A few days after the government issued a Decree declaring the country’s ‘Health Emergency’ status on 13 March 2020,[6] the Supreme Court of Justice in Resolution 12/20[7] (dated 16 March) declared a judicial ‘health recess’, closing most courts.

Through Resolutions 16/20 and 17/20[8] all deadlines to file motions were frozen from 19 March to 3 April 2020. Courts remained formally open but exclusively for ‘essential’ matters – that is ,when a party’s rights could be at serious risk pursuant to the Law 19,879: these included the granting of provisional and injunctive relief and domestic violence and criminal proceedings.

On 2 April 2020, the Supreme Court of Justice extended the recess and the deadlines until 30 April 2020[9] and later, on 30 April 2020, it extended them to 15 May 2020 (in Resolution No. 29/20).[10] From 11 May to 15 May 2020, courts were only allowed to receive written submissions in which a deadline existed or would have lapsed while the courts were closed. Other types of submissions, including the filing of complaints or the voluntary submission of evidence, were not possible.[11]

In addition, pursuant to section 3 of Law No. 19,879,[12] the statute of limitations for all contract and tort claims against private parties and government agencies (four, 20 and four years, respectively) were suspended during the health recess. Consequently, any action that could be affected by the statute of limitations during such period could be filed once the courts resumed their activity.

In parallel, the Supreme Court of Justice developed an online schedule which became available on 19 May 2020[13], allowing litigators to attend court in an organised way which permits complying with social distancing measures to deliver submissions, review case records and withdraw copies of other parties’ filings. Before attending court, litigators choose a date and time from an online calendar: so far, this has worked very well (after a couple of initial weeks of testing and adjusting). Prior registration is not needed to attend scheduled hearings. If there are no available slots in the schedule and a submission is urgent, or there are grounds to allow a party to attend court (for example, to file a request for provisional remedies or interim relief or to obtain documents in preparation for an upcoming hearing), it is still possible to obtain a date by emailing the court clerk.

As the process of rendering the different resolutions and orders was initially slow, some practitioners began agreeing on extensions of procedural terms as a means to reduce uncertainty while the actions to be taken by the government were not yet clear. In the past, in other situations in which courts closed (due to general strikes called by the clerks union) and no clear criteria with regards to deadlines were set, there were some unfortunate decisions applying force majeure and similar notions restrictively and affecting the parties’ procedural rights. This fortunately was not the case this time.

Online hearings: good results but reluctance

Starting on 14 May 2020,[14] the Supreme Court of Justice instructed courts to start implementing online hearings for civil litigation in Montevideo, the country’s capital.

So far, online hearings have been set by a rather small proportion of judges on a regular basis. However, those hearings that are held virtually – especially case management hearings – prove to be efficient and very practical. Certain adjustments are required, such as the format for presenting documents to witnesses and experts (which in Uruguay are formally incorporated to a physical file with its pages numbered by the court’s clerk), and connection problems are not unusual. Overall, practitioners report good experiences with online hearings.

However, many judges remain reluctant to dispense with physical presence, despite that possibility already existing under prior regulations applicable for examining witnesses domiciled outside Uruguay. This is probably due to a series of factors, many of them common to several countries. Uruguayan judges are very conservative. Cultural changes in the judiciary are difficult. In addition, the existing technology is limited (for example, no stenotypists exist and keeping proper record of hearings is not always easy). The support of IT services is not always available, the judge thus frequently taking the burden of coordinating the hearing. Further, following decades of written proceedings in 1991, Uruguay moved to a combined litigation system including submission of briefs and hearings with the mandatory presence of the parties, witnesses and judges. The face-to-face interaction between judges, witnesses and experts has become a foundation of the civil litigation system, and some practitioners and judges still feel it would be hampered by online hearings. While this is not true, it is very difficult to challenge this view. Particularly, when these notions are combined with a relatively low number of Covid-19 cases in the country, which means that neither judges nor lawyers are really concerned about having in-person hearings.

Other prejudices exist with regards to witnesses being examined though videoconferencing. The most typical concern is that a witness will be more inclined to lie if alone in their living room than in front of a judge. This is not true but certain measures can be implemented to control this risk. These include the presence of a representative by the court or the parties at the location where the witness is or having the witness appear in court while the parties’ legal teams join through videoconference.

Moreover, in some complex cases, online hearings are certainly preferable to in-person hearings in these circumstances. Hearing rooms are relatively small in Uruguay. While they are suitable for cases of low or medium complexity, they are probably inadequate for handling litigation of many commercial complex cases, especially multi-party cases. The general criterium now is not to allow more people than ‘needed’ to the hearing room, which to a certain point, makes sense to reduce the risk of Covid-19 contagion.

The problem arises in determining how many people are ‘needed’ on a team to handle a hearing in the best possible way for the client. Many courts only allow one lawyer per defendant in the hearing room. This makes litigating most cases very difficult: in particular, it is hard for a single lawyer to handle all documents to cross-examine all witnesses and experts, or to control hearings where procedural discussions are complex or the length/amount of documentation is very large. In cases when ten or 15 people need to be present (or the client has the constitutional right that they are present), online hearings seem to afford the best alternative for securing the parties’ right to defend their case as they consider appropriate.

Arbitration and mediation

Following the initial two months of mostly online work between March and May, and as the number of COVID-19 cases in Uruguay decreased, litigators started working using a combination of in-person and online meetings and conferences with witnesses, experts, clients, mediators and arbitrators.

International proceedings are conducted in a virtual format, as the natural consequence of travel restrictions. However, domestic arbitration proceedings under the rules of the local Chamber of Commerce (Corte de Arbitraje para el Mercosur- Bolsa de Comercio de Montevideo) were initially stayed for one month (from 16 March to 13 April 2020) as the institution was fully closed, without implementing online hearings or remote work. Some tribunals even extended the terms for written submissions due to the pandemic, mirroring the courts’ closure (which was rather inefficient and to a large extent unjustified). In May 2020, the Secretariat resumed activities and a limited number of hearings are now taking place with the appropriate social distancing and sanitary measures.

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