January 7, 2020

Mexico's Supreme Court Issues Jurisprudence on Appropriateness of Amparo Indirecto

Recent decision impacts special proceedings on commercial transactions and arbitration
Holland & Knight Alert
Salvador Fonseca | Carlos Vejar | Juan Pablo Moyano

Highlights

  • The First Chamber of Mexico's Supreme Court of Justice resolved a contradiction of rulings through which it decided that the amparo indirecto is appropriate against the judgment in the special proceedings on annulment or execution of arbitration awards.
  • With this decision, instead of two, there will be a possibility of three judicial revisions with regard to the annulment or execution of an arbitration award.

The 2011 reform that introduced the special proceedings on commercial transactions and arbitration to Mexico's Code of Commerce1 was intended to regulate on a more expedited and efficient manner the judicial intervention for commercial arbitration.

Said celerity and efficiency was attained, mainly, through a combination of two elements: 1) that there was no appeal against interim decisions, nor against the final judgment issued in the special proceedings; and 2) that the only mechanism available against the judgment was the amparo directo.

Likewise, with said reform the proceedings for the annulment or execution of arbitral awards was no longer done through ancillary proceedings and was transformed into full-fledged "proceedings." Accordingly, the only applicable writ of amparo available against the final judgment issued in the proceedings was the amparo directo, or single instance amparo (prior to the reform, the available recourse was the amparo indirecto, or dual instance amparo).

However, a recent decision on a contradiction of rulings2 issued by the First Chamber of Mexico's Supreme Court of Justice, has decided in a surprising manner that the type of amparo that is applicable against the final judgment in the aforementioned special proceedings is not the amparo directo, but the amparo indirecto.3

According to the jurisprudence, which is mandatory from Dec. 9, 2019, since the special proceedings on commercial transactions and arbitration do not decide over the merits of the case, as that would have been the subject of the arbitration, the judgment cannot be considered as a decision that can be attacked through the amparo directo, in accordance with Article 170 of the Law of Amparo.4

The First Chamber of the Supreme Court determined that, since the annulment of execution of the award is the only aspect that must be considered in the special proceedings for commercial transactions and arbitration, and that the judgment is one that is issued after the arbitration is concluded, the appropriate recourse against it is the amparo indirecto.5

By directing the parties to the amparo indirecto, there is now a possibility of a third judicial intervention based on the "recurso de revision" (revision recourse) against the ruling in the amparo.6 Differently, said possibility is only available in amparo directo in exceptional circumstances that will rarely arise in proceedings for the annulment or execution of an arbitral award.7

In summary, since the date of entry into force of this jurisprudence, the execution or annulment of an arbitral award in Mexico must be submitted, first, to a judicial authority in accordance with the special proceedings, subsequently, to an amparo indirecto before a district judge and, finally, to a revision recourse before a circuit collegiate tribunal, all of which may result in the proceedings for the annulment or execution of arbitral awards being subject to delays, and becoming much more complex.

Holland & Knight's litigation and dispute resolution attorneys have extensive experience on international and domestic dispute resolution, including commercial and investment arbitration and litigation. For more information, contact Holland & Knight's Mexico City office.


Notes

1 Decree that reforms, modifies and repeals various dispositions from the Code of Commerce, Jan. 27 2011, which modified Articles 1464 to 1480 of the Code of Commerce.

2 The contradictory rulings were held by the Third Collegiate Tribunal for Civil Matters on the Sixth Circuit and the First Circuit Plenary for Civil Matters.

3 Jurisprudence 1a./J. 87/2019 (10a.) was issued by the First Chamber, and is mandatory from Dec. 9, 2019.

4 Law of Amparo, Article 170: "The amparo directo proceeds: I. Against final judgments, awards or rulings that end the proceedings, ordered by judicial, administrative, agrarian or labor tribunals, whether the violation exists in said proceedings, or whether it was incurred during the proceedings, and it affects the defenses of the complaining party and they transcend the effects of the decision...Final judgments and awards will be understood as such if these are issued by a competent tribunal in a dispute with regard to the main issue..." 

5 Law of Amparo, Article 107: "The amparo indirecto proceeds: IV. Against acts carried out by judicial, administrative, agrarian or labor tribunals, undertaken outside of proceedings or after proceedings are concluded." 

6 Law of Amparo, Article 81: "The revision recourse proceeds: I. In an amparo indirecto, against the following decisions: ... e) The judgments issued in a constitutional hearing, in which case, the rulings issued during the hearing must be challenged." 

7 Law of Amparo, Article 81(II): "In an amparo directo,against the judgments that decide over the constitutionality of general norms that establish the direct interpretation of a provision of the Political Constitution of the United Mexican States or the human rights established in international treaties to which the Mexican State is a party, or which fail to decide over such issues when raised, and as provided by an important and transcendent precedent, as ordered by the Supreme Court of Justice of the Nation, in compliance with general agreements issued by the Plenary."  


Information contained in this alert is for the general education and knowledge of our readers. It is not designed to be, and should not be used as, the sole source of information when analyzing and resolving a legal problem. Moreover, the laws of each jurisdiction are different and are constantly changing. If you have specific questions regarding a particular fact situation, we urge you to consult competent legal counsel.


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