What Are Legal Proceedings, Contracts and Powers of Attorney?

The instruments of the law

In the first study in this series, we asked what law, justice and legislation are — the ideas. Now we ask about the instruments through which those ideas are carried out in real life.

There are three, and each corresponds to a form of power. Legal proceedings are the instrument of jurisdiction: the way the State, once called upon, declares and enforces the law in a concrete case. Contracts are the instrument of autonomy: the way private parties create, among themselves, obligations with the force of law. Powers of attorney are the instrument of representation: the way one person's will is projected and acts through another.

Lawyers live at the intersection of the three. They receive a power of attorney, review or draft contracts and conduct proceedings. Understanding the nature of each is not a theoretical exercise: it defines what can be agreed, what can be demanded and what can be done on someone else's behalf.

Part I — What are legal proceedings?

The Portuguese word processo comes from the Latin procedere, to move forward. It is an ordered sequence of acts leading to a decision. But the question of its legal nature — what, after all, binds plaintiff, defendant and judge — occupied procedural scholars for more than a century.

Contract and quasi-contract. The older doctrine, of Roman and French origin, saw proceedings as an agreement between the parties to submit their dispute to a judge — or, when real consent was lacking, as a quasi-contract. The theory collapsed because the defendant does not consent to being sued: jurisdiction is imposed on them.

Legal relationship. In 1868, Oskar von Bülow, in The Theory of Procedural Defenses and Procedural Prerequisites, showed that proceedings are a legal relationship of their own, distinct from the substantive relationship in dispute, with specific subjects, prerequisites and object. It was the milestone that made procedural law an autonomous science, and the theory that most influenced the Brazilian tradition.

Legal situation. James Goldschmidt (1925) criticized the idea of a relationship: in proceedings there are not really rights and duties, but expectations, possibilities and burdens — chances of obtaining a favorable judgment depending on how the parties discharge their burdens.

Institution. Jaime Guasp saw proceedings as an institution, a set of activities unified by a common purpose that prevails over individual wills.

Adversarial procedure. Elio Fazzalari proposed that proceedings are a kind of procedure distinguished by the participation, on equal footing, of those who will be affected by the decision. The key is no longer the bond between subjects, but the adversarial principle.

Constitutional procedure. In contemporary Brazil, legal proceedings are above all a fundamental guarantee. The Constitution guarantees due process of law (Art. 5, LIV), the adversarial principle and full defense (LV) and a reasonable length of proceedings (LXXVIII, added by Constitutional Amendment 45/2004). The 2015 Code of Civil Procedure opens by declaring that civil procedure shall be ordered and interpreted in accordance with constitutional values (Art. 1), enshrines the right to a full decision on the merits within a reasonable time, including enforcement (Art. 4), and imposes a duty of cooperation on all participants (Art. 6).

Two innovations bring proceedings closer to contract. The first is the encouragement of consensual dispute resolution (Art. 3, §§ 2 and 3). The second is the procedural agreement (Art. 190): in cases that allow settlement, fully capable parties may adjust the procedure and agree on their procedural burdens, powers, faculties and duties. The old contractual theory, defeated as a general explanation, reappears as a strategic tool — clauses choosing the procedure, procedural calendars and agreements on evidence are already part of good contract drafting.

Part II — What is a contract?

A contract is a bilateral or multilateral juridical act by which two or more persons, by agreement, create, modify or extinguish legal relationships of a patrimonial nature. To be valid, it requires a capable party, a lawful, possible and determinate (or determinable) object, and a form prescribed or not prohibited by law (Civil Code, Art. 104). The definition is simple; the history of the idea is not.

From Rome to the Napoleonic Code. Roman law had no general category of contract: there were specific types, and a bare agreement did not, as a rule, give rise to an action. It was the canon law tradition, with its emphasis on the given word, and later modern natural law that established the principle that consent alone is enough to bind — pacta sunt servanda. The French Civil Code of 1804 took the idea to its peak: agreements lawfully formed have the force of law between the parties. It was the legal expression of liberalism: free and equal individuals, bound only because they wish to be.

The crisis of autonomy and State intervention in contracts. Industrialization showed that formal equality concealed real inequalities. Employment, adhesion and consumer contracts came to be regulated by the State to protect the vulnerable party. In Brazil, the Consolidated Labor Laws (CLT, 1943) and the Consumer Protection Code (1990) are the landmarks of this movement.

The contract as an economic operation. Enzo Roppo, in The Contract (1975), offered a useful key: a contract is the legal garment of an economic operation. Understanding the operation — who bears which risk, at what price, over what period — is a precondition for drafting, interpreting or revising a contract well.

The balance of the 2002 Civil Code. Under the coordination of Miguel Reale, the Code added two counterweights to private autonomy: the social function of contract (Art. 421) and objective good faith, which requires loyalty before, during and after performance (Art. 422). It also allowed revision or termination for excessive onerousness resulting from unforeseeable events (Arts. 317 and 478).

The return of contractual freedom. The Economic Freedom Act (Law 13,874/2019) rebalanced the pendulum: in private relationships, the principle of minimal intervention and the exceptional nature of contract revision prevail (Art. 421, sole paragraph); in civil and business contracts between equals, the parties are presumed to be on an equal footing, and the risk allocation they define must be respected (Art. 421-A).

The contract of the future. Electronic contracts and digital signatures are already routine. So-called smart contracts — clauses executed automatically by code — challenge traditional concepts of interpretation, breach and revision. Bill 4/2025, which proposes an update of the Civil Code and is still pending in the Senate, includes provisions on digital law and revisits contract rules — a debate every contracts professional should follow.

Key takeaway: contracts swing between two poles — the freedom of those who contract and the protection of those who are vulnerable. The lawyer's role is to know where on that pendulum each contract sits and to draft it to withstand revision.

Part III — What is a power of attorney?

Representation, mandate and power of attorney. The three terms are often used as synonyms, but they are not. Representation is the phenomenon by which someone acts in another's name, binding that person; it may arise from law (parents in relation to minor children) or from will. Mandate (mandato) is the contract by which someone receives from another the power to perform acts or manage interests in that person's name. A power of attorney (procuração) is the instrument of that mandate (Civil Code, Art. 653). The distinction was systematized by Paul Laband in 1866: the mandate governs the internal relationship between the parties; the grant of representative powers governs the external relationship, vis-à-vis third parties.

Form. A private power of attorney must state the place, the identification of the parties, the date, the purpose of the grant and the nature and extent of the powers (Art. 654), and third parties may require a notarized signature. When the act to be performed requires a public deed — such as the sale of real estate above the statutory value — the power of attorney must also be public (Art. 657). Since 2020, public powers of attorney can be executed electronically, by videoconference, through the e-Notariado platform. For use abroad, a Brazilian document must be apostilled; a foreign one must be legalized or apostilled for use in Brazil.

General and special powers. A mandate in general terms confers only powers of administration. To sell, mortgage, settle or perform acts beyond ordinary administration, special and express powers are required (Art. 661, § 1). This is the source of many disputes: a power of attorney "with broad powers" that does not expressly mention the power to sell a property does not authorize the sale.

The litigation power of attorney. A lawyer may not appear in court without a power of attorney, except to prevent preclusion, forfeiture or limitation, or to perform an urgent act (Code of Civil Procedure, Art. 104). A general power of attorney for litigation authorizes all procedural acts except receiving service of process, confessing, acknowledging the claim, settling, withdrawing, waiving the underlying right, receiving payment, giving a release, signing an arbitration commitment and signing a declaration of financial hardship — powers that must appear in a specific clause (Art. 105). Omitting one of them can prevent a settlement at the hearing.

Delegation and irrevocability. The agent may transfer the powers to a third party, with or without reservation (Art. 667). A power of attorney is, as a rule, revocable at any time, but becomes irrevocable when the clause is a condition of a bilateral transaction or was stipulated in the agent's own interest; in a power of attorney in rem suam (in the agent's own interest), it does not terminate even upon the death of the parties, and the agent need not render accounts (Art. 685) — a figure that, in practice, resembles an assignment of rights.

The incapacity trap. A mandate ends upon revocation, renunciation, the death or legal incapacitation of either party, a change of status that disqualifies the principal, and the expiry of its term or the completion of the transaction (Art. 682). Third parties in good faith are protected until they learn of the termination (Arts. 686 and 689). The critical point is supervening incapacity: precisely when a person most needs someone to represent them — due to serious illness or loss of discernment — the power of attorney may lose effect, and the family becomes dependent on a court-ordered guardianship (curatela), which is slow and costly.

The contrast with the United States is instructive. There, the durable power of attorney is designed precisely to survive the principal's incapacity and, in many states, is the default rule. In Brazil, the solution requires planning: supported decision-making (Civil Code, Art. 1,783-A), advance healthcare directives, and wealth structures such as holding companies with defined management and succession rules, which reduce dependence on individual powers of attorney. This is a central issue for families with assets in Brazil and abroad.

Key takeaway: every power of attorney must answer three questions — who may do what, in what form, and until when. An imprecise answer to any of them usually proves costly.

Synthesis

A critical reading

The three institutions are converging. Legal proceedings, born as an imposition of the State, have opened room for the parties' will through procedural agreements. Contracts, born as a pure expression of will, now coexist with duties imposed by law — social function and good faith. The power of attorney, an instrument of trust, increasingly depends on form, specificity and planning so as not to fail precisely when it is most needed.

The common point is that will and form are not opposites: well-designed form is what protects the will. A well-drafted contract avoids litigation; a well-considered power of attorney avoids guardianship; a well-conducted proceeding delivers what the contract promised. It is in this chain that preventive legal practice shows its value.

Next study

Legal proceedings, contracts and powers of attorney operate within a larger structure that gives them authority. The third and final study in the series asks what democracy, the State and government are.

References

• BÜLOW, Oskar von. Die Lehre von den Processeinreden und die Processvoraussetzungen (1868).
• GOLDSCHMIDT, James. Der Prozess als Rechtslage (1925).
• FAZZALARI, Elio. Istituzioni di diritto processuale.
• DINAMARCO, Cândido Rangel. A Instrumentalidade do Processo (1987).
• ROPPO, Enzo. Il contratto (1975).
• REALE, Miguel. O Projeto do Novo Código Civil (1999).
• LABAND, Paul. Study on representation in the conclusion of juridical acts (1866).
• Brazilian Federal Constitution, Art. 5, LIV, LV and LXXVIII.
• Code of Civil Procedure, Arts. 1, 3, 4, 6, 104, 105 and 190.
• Civil Code, Arts. 104, 317, 421, 421-A, 422, 478, 653 to 692 and 1,783-A.
• Law 13,874/2019 (Economic Freedom Act).
• PL 4/2025: o que muda com o novo Código Civil — Aurum, August 5, 2026 (in Portuguese)

Advanced Studies Collection — Biblioteca Andrade & Cintra. Informational and academic content. It does not constitute legal advice and does not create an attorney-client relationship.