Recently, Judge Larissa Gaspar Tunala, of the 1st Business and Arbitration Conflicts Court of the District of São Paulo/SP, annulled the arbitration clause in a lease contract on the Quinto Andar platform on the grounds of the vulnerability of the tenant party and the absence of their consent to the use of arbitration.
It has become increasingly common for arbitration clauses to be included in adhesion contracts in order to take any problems that arise in the business relationship to arbitration. Arbitration does indeed have many advantages over the Judiciary as a method of resolving conflicts. However, as it is an exception to the rule, some care must be taken when establishing jurisdiction.
In the case in question, although the contract did include an arbitration clause, relegating the resolution of any disputes exclusively to arbitration chambers appointed by the company, the tenant claimed that she had not had the opportunity to understand the clause or negotiate its terms.
The seriousness of the situation was such that the electronic arbitration procedure ran in absentia and culminated in an eviction order! In other words, there wasn’t even an opportunity for a defense or payment of the arrears.
When can an arbitration clause be considered null and void?
Although the establishment of arbitration is generally valid in commercial contracts, the imposition in a context of vulnerability, the absence of express and specific consent to the clause and the deprivation of free choice can lead to the nullity of the stipulation based on the Consumer Protection Code and the Arbitration Law itself. This was exactly the judicial justification for recognizing the nullity in question.
It is also necessary to consider the right in dispute. In the situation in question, the Right to Housing, given its undeniable importance, could not have been suppressed in the face of a clearly abusive clause. For this reason, assessing the nature of the right in question is equally important when analyzing whether or not the arbitration clause is unfair.
We are attentive to new developments in case law and discussions in all areas of the Judiciary, in order to provide adequate and effective advice to our clients.
