Thamara M. Belinatti and Heloisa Nogueira
In early January, there was a new development in the judicial reorganization proceedings of the SouthRock Group, the operator of the Eataly Italian restaurant franchise in Brazil. As part of the reorganization process, the solution adopted was the sale of franchise rights to the investment fund Wings. However, even after the sale, the company undergoing reorganization continued to use the brand, thereby breaching the terms of the agreement.
Consequently, a crucial decision was issued by an arbitral tribunal ruling that the company undergoing reorganization had forfeited its right to use the brand due to the breach of contract; the decision reinforced the importance of *pacta sunt servanda*—even during ongoing judicial reorganization proceedings—thereby establishing a boundary between the principle of the social function of the contract and the principle of preserving the enterprise.
This case serves as a significant example of the proper and necessary recognition of the jurisdiction of arbitral tribunals, even in matters involving judicial reorganization proceedings. The mechanism normally reserved for discussing the enforceability of contractual limits had to enter this dispute regarding the recognition of two principles of great importance to business law.
In general, arbitration is also frequently used to determine unliquidated claims against companies undergoing judicial reorganization—that is, claims arising from contracts where the value has not yet been ascertained. In such situations, the verification of the claim can be carried out through an arbitral tribunal, given that judicial reorganization proceedings do not have the effect of barring or suspending arbitration proceedings, pursuant to Article 6, Paragraph 9, of Law No. 11.101/2005.
Furthermore, the judicial administrator cannot refuse to give effect to an arbitration clause, as it possesses autonomy relative to the main contract. This interpretation has been confirmed by the Superior Court of Justice (STJ). Similarly, Statement No. 75 from the 2nd Commercial Law Seminar clarifies that ongoing arbitration proceedings cannot be suspended upon the declaration of bankruptcy or the commencement of judicial reorganization; likewise, it is possible to initiate new arbitration proceedings in such cases.
Therefore, arbitration proceedings are permitted during judicial reorganization, provided that the arbitration agreement predates the filing for judicial reorganization. It is important to note, however, that an arbitral tribunal lacks the authority to enforce the payment of a determined amount. That function falls within the exclusive jurisdiction of the bankruptcy judge, as provided by current legislation.
The SouthRock Group case demonstrates how arbitration has gained ground within our legal system, especially following amendments to the Code of Civil Procedure, which began recognizing arbitral awards as enforceable titles. The importance of arbitration in resolving contractual issues and determining unliquidated claims proved essential to the efficient resolution of the case.
