MEXICO: An Introduction to Dispute Resolution: Civil & Commercial Litigation

National Code of Civil and Family Procedure 

Mexico has 33 codes of civil procedure in force; one for federal matters and 32 for local matters pertaining to each of the 32 entities comprising the country.

The codes of civil procedure are mainly used for civil proceedings but may also be used supplementarily for constitutional, amparo, administrative, commercial, and other kinds of proceedings when the applicable procedural laws fail to regulate, either totally or partially, certain scenarios or legal figures.

While the codes of civil procedure are similar to one another, they often contemplate special rules that distinguish them. Naturally, this poses an important challenge to litigators – who, by obtaining a licence to practice law in Mexico, are automatically enabled to appear and litigate before all federal and local courts across the nation – and, to some extent, creates undesired conflicts of laws whenever federal matters intersect with local matters, or whenever local matters of one entity overlap with those of another entity.

Accordingly, the Constitution was amended on 15 September 2017 to empower the Congress to enact a sole “National Code of Civil and Family Procedure” to replace all 33 codes of civil procedure currently in force and be employed for both federal and local proceedings.

It was not until November 2021 that Congress began discussing a bill to enact the National Code of Civil and Family Procedure. Discussions revolved around taking the best out of the codes meant to be replaced, incorporating the view of the judicial branch as expressed in recent case law, acknowledging the technological revolution sweeping over the world, privileging oral over written proceedings, as well as substance over form, designing an effective challenge system, in accordance with the standards set forth in the international treaties to which Mexico is a party, and – in general – creating a modern and slick set of rules easing the access to prompt, high-quality justice.

As the legislative minutes show, Congress also wanted to push the courts into promoting debate among the parties and facilitating the production of evidence as a way to efficiently find the truth within disputes and actually impart justice.

After several discussions and the involvement of Mexico’s Supreme Court of Justice due to legislative delays, on 7 June 2023, the National Code of Civil and Family Procedure was finally enacted. However, since it entails a massive transformation to the country’s procedural dynamics, the legislation shall enter into force gradually.

At a federal level, the Code shall come into effect when Congress issues a declaration of applicability at the request of the Federal Judicial Branch. At a local level, each local Congress shall trigger its applicability upon issuing a similar declaration, following a prior request from the respective Local Judicial Branch.

In any case, the National Code of Civil and Family Procedure shall come into force no later than 1 April 2027.

This new Code should strengthen the rule of law in Mexico in the coming years.

Commercial Oral Proceedings 

Mexico’s federal and local procedure laws have been moving – for some time now – towards oral proceedings, turning away from written proceedings that have long dominated the litigation scene in most civil law legal systems.

The newly enacted National Code of Civil and Family Procedure adopted orality as a principle and methodology in most of the procedures regulated therein.

Notably, the Commerce Code has incorporated both ordinary oral proceedings and summary oral proceedings with the idea of gradually replacing most written proceedings.

As an illustration, in 2011, only disputes falling below a certain amount-threshold were decided through ordinary oral proceedings. Such amount-thresholds were increased over the years until definitively lifted. As of January 2020, all commercial disputes that involve liquidated claims and which would have been otherwise adjudicated through ordinary written proceedings are decided through ordinary oral proceedings. If the disputes arise from non-liquidated claims, then they are still decided through ordinary written proceedings.

An amount-threshold is in place for summary oral proceedings. Accordingly, to date, summary oral proceedings are only available for summary claims falling below approximately MXN200,000.

It is worth mentioning that oral proceedings are far quicker than written proceedings. For one thing, only a few rights may be asserted in writing. This includes the claim, the response to the claim, the answer to the response and, if applicable, the counterclaim, the response to the counterclaim, and the answer to the response. All other motions and pleadings must be brought in oral hearings and must be immediately decided by the competent court.

There are two hearings in oral proceedings. The first – the preliminary hearing – is designed to analyse and rule on procedural defences, clear out undisputed facts, and arrange for the logistics of the production of evidence. The second – the trial hearing – is meant for the actual production of evidence, including cross-examinations and expert reports, the expression of closing arguments, and the ruling on the merits of the claim.

It is important to realise that, unlike written proceedings, no revocation requests or appeals may be filed against procedural violations in oral proceedings. This means that parties must wait until a decision on the merits of the case is issued to contest, through an amparo directo claim, both the relevant procedural violations and the final ruling on the merits.

All hearings are recorded, either by video or audio. In this regard, several courts across the country have struggled to offer the appropriate facilities to hold and record hearings of oral proceedings as required by law. This is not the case for Mexico City courts, which are sufficiently equipped and trained to handle this type of proceeding.

Oral proceedings constitute yet another effort by Congress to secure access to prompt and high-quality justice.

Finally, at a local level, in light of the National Programme of Commercial Oral Proceedings, and the imminent applicability of the National Code of Civil and Family Procedure, different local courts have been obtaining training and certification for the proper implementation of these proceedings.

COVID-19 and Technology 

Not every aspect of the COVID-19 pandemic has been negative. Shortly after the outbreak, the Mexican legal system experienced an accelerated transition to electronic trials and files.

Mexican courts were closed for five out of the 12 months of 2020. When they resumed activities, they did so on a very limited basis, especially in aspects concerning attendance at courts; that is, filing of paper writs, reviewing hard copy files, speaking with judges and judicial clerks, holding hearings, etc. This caused a huge delay in the administration of justice.

Fortunately, federal courts and some local courts, including Mexico City courts, rapidly enhanced existing tools and enabled new mechanisms to allow the filing of electronic writs, digitalisation of existing hard copy files, integration of new electronic files, and holding of videoconference meetings and hearings with both judicial clerks and counterparties. This considerably shortened the timeframes contemplated in the federal and local judicial branches’ electronic-migration agendas.

As of today, some federal claims and proceedings may be entirely pursued and handled electronically. Resolutions may be served or notified by email or other electronic means. By the same token, sessions of federal collegiate courts may be watched live through streaming platforms.

Hopefully, the technological revolution of the Mexican judicial system will continue in the coming months, especially in local courts.

Another key point related to judicial activity within the context of the COVID-19 pandemic is the courts’ approach to problems that society consistently faced due to the 2020 economic downfall, markedly within the real estate sector.

By means of example, courts have been generally holding that lessees of commercial properties were excused from paying rent to lessors while they were totally precluded from operating their businesses in the leased properties pursuant to government measures aimed at controlling the pandemic. In turn, courts have been ruling that lessees were obliged to pay 50% of the agreed rent while they were partially precluded from operating their business.

Leaving aside personal opinions on the fairness of the courts’ approach to the issue, one cannot deny the fundamental role that the judicial branch plays in reinstating balance in commercial relationships and the huge challenges that courts face when assessing valid interests and concerns from opposing parties as lessors and lessees, in a post-pandemic reality.