Compulsory Adjudication: What to Do When the Seller Refuses to Sign the Deed

This page is a translation of the original Portuguese text, provided for convenience. It deals with Brazilian law. If there is any discrepancy, the Portuguese version prevails. Read the original in Portuguese

When the seller of a property refuses to execute the public deed, the buyer can turn to compulsory adjudication to obtain a court-ordered transfer of ownership and secure the transaction.

What compulsory adjudication is

Compulsory adjudication (adjudicação compulsória) is a lawsuit provided for under Brazilian law. It allows the buyer of a property to obtain the final deed when the seller refuses or fails to execute it, even after the full price has been paid. It is an essential tool for making real estate sales contracts effective, and it keeps the bad faith or inaction of the seller from harming a buyer who has fulfilled all of his or her contractual obligations.

This action is based on Article 1.418 of the Civil Code, which gives the buyer under a registered purchase and sale agreement (compromisso de compra e venda) the right to request compulsory adjudication. In addition, Precedent 239 of the Superior Court of Justice (STJ) broadened this protection by establishing that the right to compulsory adjudication does not depend on registering the purchase and sale agreement at the real estate registry office.

Requirements for filing the action

For compulsory adjudication to be viable, a few basic requirements must be met. The first is a promise-to-sell contract, whether private or public, that shows the intent to transfer the property. The contract does not have to be registered at a registry office, as the STJ’s settled case law makes clear.

The second requirement is full payment of the agreed price. The buyer must prove that he or she paid all installments or the total amount set in the contract. If any payment is outstanding, the seller may contest the action. Finally, you must show that the seller refuses, or is unable, to execute the deed, whether through an express refusal, disappearance, death, or any other circumstance that prevents a voluntary transfer.

Compulsory adjudication gives a buyer who has met all contractual obligations the right to obtain a court-ordered transfer of ownership.

The required documents include the original contract, proof of payment, an extrajudicial notice to the seller (when possible), and the property’s current registry record (matrícula). Having these documents organized is essential to the success of the case.

Extrajudicial compulsory adjudication

With the entry into force of Law 14.382/2022, which amended the Public Records Law (Law 6.015/73), it became possible to carry out compulsory adjudication out of court, directly at the real estate registry office. This legislative change is a significant step toward resolving real estate disputes without litigation, because it allows the buyer to obtain the deed and the property registration without a lawsuit.

The extrajudicial procedure requires filing a request with the real estate registrar, together with the promise-to-sell contract, proof of full payment, and notice to the seller. The registrar notifies the seller to respond within 15 days. If there is no objection, the registrar may proceed with the adjudication.

This out-of-court route is faster and less expensive than going to court. It can be completed in weeks, while a lawsuit can take years. However, if a well-founded objection is raised, the case is sent to the courts for a decision.

Differences between the judicial and extrajudicial routes

The judicial route is appropriate when there is a clear conflict between the parties, when the seller objects to the request, or when complex issues involve third parties such as heirs or creditors. The case is heard by the competent civil court and follows the ordinary procedure, with the possibility of evidence, hearings, and appeals. The average time to conclusion varies by judicial district and can range from one to three years.

The extrajudicial route, introduced by Law 14.382/2022, is better suited to situations in which the seller simply does nothing or cannot be located. The registrar conducts the procedure, which tends to be resolved in a significantly shorter time. Both routes produce the same practical result: ownership of the property is transferred to the buyer’s name.

Consequences and effects of the judgment

A judgment granting compulsory adjudication takes the place of the seller’s consent and serves as a valid title for registering the transfer at the real estate registry office. Once the transfer is registered, the buyer becomes the formal owner of the property and can exercise all the rights of ownership, such as selling it, mortgaging it, or offering it as collateral.

It is important to note that compulsory adjudication does not address the merits of the contract itself, only the obligation to execute the deed. Issues such as property defects, hidden defects, or breach of other contract clauses must be raised in separate lawsuits.

The costs involved include court costs (in the judicial route), registry office fees, the ITBI (the municipal real property transfer tax), if not yet paid, and attorney’s fees. The buyer should be prepared to cover these expenses, which are necessary to complete the transfer.

Frequently Asked Questions

Who can file a compulsory adjudication action?

Anyone who has entered into a promise-to-sell contract for real estate and has paid the price in full can file for compulsory adjudication, whether or not the contract is registered at a registry office. This right also extends to assignees, meaning people who acquired the original buyer’s rights through an assignment of rights. The heirs of a deceased buyer also have standing to bring the action.

What is the statute of limitations for compulsory adjudication?

Compulsory adjudication is considered an action in rem (ação de natureza real), tied to the right of ownership. The prevailing view in the case law is that there is no statute of limitations on exercising this right, since the claim rests on a real right of acquisition. As long as the buyer remains in possession of the property and the contract remains in force, he or she may request adjudication at any time, without risk of losing the right with the passage of years.

How does compulsory adjudication work when the seller has died?

When the seller dies before executing the deed, the compulsory adjudication action must be brought against the decedent’s estate (espólio) or the decedent’s heirs. If probate (inventário) is already underway, the request can be made within the probate case itself. Otherwise, a separate action is filed against the successors. The seller’s death does not prevent the buyer from exercising this right, and it is one of the most common situations in which this legal tool is used.

As informações deste artigo são de caráter informativo e não substituem consulta jurídica individualizada. Cada caso possui particularidades que exigem análise específica.