BRAZIL Law and Practice Contributed by: Godofredo Mendes Vianna, Camila Mendes Vianna Cardoso and Lucas Leite Marques, Kincaid | Mendes Vianna Advogados
• expenditure for the upkeep of the ship and her appurtenances, and maintenance expens - es at the port of sale; • short delivery and cargo losses; • debts arising out of the construction of the vessel; • expenses incurred for repairs of the vessel and her appurtenances; and • the outstanding price of the vessel. 4.11 Insolvency Laws Applied by Maritime Courts The primary legislation governing insolvency and restructuring proceedings in Brazil is Fed - eral Law No 11,101/2005 (the Brazilian Business Insolvency Act), which incorporates the UNCI - TRAL Model Law on Cross-Border Insolvency to assist states with cases where the insolvent debtor has assets in more than one country or where some of the creditors of the debtor are not from the country where the insolvency proceed - ings are taking place. Regarding a possible order of arrest and judi - cial sale of a vessel before the competent bank - ruptcy court, it should be noted that an asset cannot be arrested if it is considered essential for the preservation of the company’s activity. Furthermore, the decision of the essentiality of the asset is a matter only for the bankruptcy court. If the interest is in the sale of the vessel, this must have been previously requested from the bankruptcy court, as determined by Article 66 of Law No 11,101/2005. 4.12 Damages in the Event of Wrongful Arrest of a Vessel The Civil Procedural Code allows the defend - ant of a wrongful arrest to seek indemnity and compensation for all losses suffered as a result of the wrongful arrest. That compensation can
be assessed and liquidated in the same legal proceedings as the arrest.
5. Passenger Claims 5.1 Laws and Conventions Applicable to the Resolution of Passenger Claims Brazil is not a signatory to the Athens Conven - tion or its protocols. While being transported or on cruise trips, Brazilian and foreign passengers have their rights supported by both the Brazilian Civil Code and the Brazilian Consumer Code, which establish the right to full reparation to the passenger or consumer, plus non-material dam - ages. The time bar to file a claim based on the Brazilian Consumer Code is five years. 6. Enforcement of Law and Jurisdiction and Arbitration Clauses 6.1 Enforcement of Law and Jurisdiction Clauses Stated in Bills of Lading The Brazilian Civil Procedural Code expressly recognises forum selection clauses as valid and binding, so such clauses should be complied with. In relation to bills of lading specifically, there are some court decisions considering a bill of lading to be a contract of adhesion, when the issuer (ship-owner) establishes its clauses without negotiation with the other party and the other party is considered not to have expressly agreed. However, it will be very important to veri - fy whether the party adhering to the contract had or should have had knowledge of what it was accepting with the contract.
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