On June 7, 2023, the National Code of Civil and Family Procedures (“CNPCF”) was published in the Official Gazette of the Federation, which aims to eliminate local legislation on the matter and have them replaced by new regulations that establish standardized procedures throughout the country.
The impact that this law will have on insurance will be in the processing of direct action in matters of civil liability (RC), which consists of the power that the victim of an accident has to demand the payment of compensation directly from the insurer of the person responsible for the damage. Currently, this trial is processed in the ordinary civil route through a written process, which will change in 2027 with the entry into force of the CNPCF.
The aforementioned adjective law, in article 456, establishes that all controversies of a civil nature (which do not have a special procedure) will be processed through the civil oral trial. Therefore, this will be the process to which insurers must submit in cases where direct action is exercised against them.
Considering that the duration of proceedings in matters of non-contractual civil liability in Mexico City has an average duration of 19 months[1]Â (only in the first instance), it is estimated that the incorporation of the oral trial will allow for a more agile process because it has shorter deadlines and incorporates the principles of orality and immediacy. which allow the judge to have direct knowledge of each file.
[1] Juan Carlos MarÃn González, Average Duration and Some Statistics of Trials in Matters of Extracontractual Civil Liability in Mexico City (1995-2008), published on January 5, 2018.
For example, some differences in the deadlines are as follows. In our current system corresponding to the ordinary civil trial we have: 15 days for the answer to the claim, 10 days for the offer of evidence and 12 days to appeal the final judgment. On the other hand, with the new oral trial, it is reduced to: 10 days for the answer to the claim, there is no evidentiary delay, and there are 9 days for the appeal. In addition, the hearings may be concentrated in the event that there are only documentaries and testimonies or any other evidence that requires preparation should not be vented.
Given the nature of civil liability insurance, it will require the insurers that cover it to have efficient systems and programs that allow access to all the information necessary for the exercise of the defense in a timely manner of the liability of their insured. In other words, both the claims and underwriting teams must be in sync in order to offload the liability of the insured, including the issues arising from due diligence when the payment of punitive damages is demanded.
In conclusion, the CNPCF will have a direct impact on the legal processes related to insurers due to the homogenization of civil procedures throughout the Mexican Republic. From 2027, the direct action that is currently carried out through a written process in the ordinary civil route, will be processed in the civil oral trial, so it is estimated that the new code will help to have faster and more effective processes than those carried out with the current legislation.
At Ocampo 1890 we have more than 4 decades of experience in the insurance sector, so we remain at the forefront of all current legal issues, always with the aim of advising our clients effectively.
We are experts in Insurance and Reinsurance Law and are ranked in Chambers & Partners, The Legal 500 and Best Lawyers as one of the best Insurance Law firms in Mexico.
Sheila Angélica RodrÃguez Silva
Attorney at Law
sheila.rodriguez@ocampo.law
Abraham Estrada Soto
Associate
abraham.estrada@ocampo.law
