Introduction
- Contrary to the beliefs widely held in the U.S. regarding the nature and function of Mexico's legal system, Mexico does, in fact, enjoy a highly evolved and organized legal system which with few exceptions is functional. The origins of Mexico's legal system are both ancient and classical, based on the Greek, Roman and French legal systems, and the Mexican system shares more in common with other legal systems throughout the world (especially those in Latin America and most of continental Europe) than does the U.S. legal system. U.S. business people and foreign owned corporations doing business in Mexico must directly and indirectly deal with the Mexican legal system, even if they do not have an actual business presence in Mexico. They might encounter Mexico's system through and international contract which they enter into with a Mexican company or individual, even if the contract is wholly performable in the U.S. Many such contracts are negotiated covering the distribution of products, the granting of franchises, or the transfer of technology, among other legal relationships.
Accordingly, such business people should have at least a general working knowledge of the system. U.S. legal counsel with clients doing business in Mexico should have a more detailed knowledge of Mexican practices, laws and courts. All should understand that if they are to accomplish their objectives they must work within the system, not against it. This article is intended to be only a general discussion of Mexico's legal system. A comprehensive treatise of the topic would fill volumes.
MEXICO'S CIVIL LAW SYSTEM COMPARED TO THE U.S. COMMON LAW SYSTEM - To better understand the Mexican legal system, it is useful to compare it to the U.S. legal system. A fundamental difference between the two legal systems is that Mexico is a so called "civil law" country while the U.S. is a "common law" country.
The U.S. common law system is based on the case law and statutory law of England and the American colonies before the American Revolution. As the name implies, the traditional common law system emphasizes case law, customs and usage rather than legislative enactments. In contrast, Mexico's civil law system is derived primarily from Roman law as set forth in the compilation of codes and statutes of the Emperor Justinian, called Corpus Juris Civilis, and later refined in the French or Napoleonic Code of 1804. Interestingly, the development of Mexican commercial law drew heavily on Italian law. Mexico's legal system is also influenced by colonial law (the Spanish and "Indian" law of Spain's colonization in the areas that became Mexico and other present day Latin American countries), which was a highly formal body of law, including specific collections of not only laws but customs or accepted legal practices, that required the use of intricate regulations and elaborate writings associated with every important act of one's life, such as birth or marriage, and canon law, or religious law, issued by the Catholic Church. This distinction between two systems based on their respective origins, along with the unique traditions and practices stemming from these different origins, is today the clearest and most important distinction.
For decades, another important distinction between Mexico's civil law system and U.S. law was the codification of Mexican law, on other words, Mexico's adoption and use of codes (like the Civil Code and Commercial Code). Codification, however, is no longer a significant distinction between the two legal systems. Indeed, the U.S. has enacted several federal codes such as the Tax, Bankruptcy and Immigration Codes, and collection or federal criminal statutes and civil and criminal procedure. Further, virtually every U.S. state has adopted some version of the Uniform Commercial Code. Also, most states have enacted codes covering such areas as Property, Probate, Tax, Family, Education, Government. Health and Safety, Penal matters, Insurance, and Elections.
Another traditional distinction between the two systems which has not declined in significance over the years is the importance of and reliance on case law precedent (a principle known as stare decisis) in the U.S. at both state and federal levels, compared with the sparse use of the case law in Mexico. In the U.S. even one case can establish a legal principle that judges will follow in subsequent, similar cases, especially where there is no applicable statute or conflicting precedent on point. State and federal judicial opinions are widely published and circulated. Indeed, so called case reporters constitute the bulk of law books found in U.S. law libraries.
Notwithstanding this distinction, case law in Mexico should not be ignored, Certain judgments, called educators, of the federal courts including the Mexican Supreme Court and the circuit courts, and, at the state level, judgments issued at the appellate level (Tribunal Superior de Justicia), have persuasive value and are published although they are not widely circulated.
In Mexican administrative law, such as taxation, labor and banking and financial service law, binding rulings and regulations are frequently issued by the corresponding regulatory agencies. These rulings and regulations have the effect of binding case law. Because of its dramatic growth and increasing importance, the dynamic and diverse body of Mexican administrative law is slowly overtaking the more staid institutions of Mexico's traditional civil law system.
Also, binding case law precedents not unlike common law precedents do exist in Mexico. These are called jurisprudencia, are published from time to time and are supplemented through restatements, or summaries of what the law is and how it has changed. To qualify as a jurisprudencia definida, the legal principle set forth in a case must interpret Mexican law under a Writ of Amparo, which is a summary proceeding that serves to guarantee constitutional rights. This relevant legal issue must also be decided the same way in 5 consecutive cases by majority vote of the judges and without and inconsistent ruling by the deciding court of the Supreme Court. Such rulings are binding only on equal or lower courts and administrative courts, not on executive administrative agencies. The concept of jurisprudencia has been expanded broadly with the increased use and number of administrative courts in Mexico.
Compilations of administrative rules and regulations can combine to create a binding effect within the different categories of administrative law. There are certain limitations on establishing such binding precedents and regulations, because under Mexican law, judgments, regulations ruling and administrative orders must be issued in accordance with the underlying statue. However, as a practical matter, the volume of these extra legislative decisions and rules is growing so rapidly that statutory law in Mexico now covers only the most basic and predictable cases and in most situations, one must look beyond the statute for guidance.
Each legal system has strengths and weakness. Whereas in the U.S. when law is declared unconstitutional its unconstitutionality is usually applied universally, in Mexico, for the reasons stated above, the law is unconstitutional only for the party which filed the amparo case. Others who wish to challenge the law must file their own cases. May business people consider this requirement inefficient and burdensome, although as a practical matter, most people doing business in Mexico do not engage in this type of litigation.
In the opinion of the authors, one advantage to the Mexican legal system is that the full body of Mexican law in particular area, for example labor law or contract law, is more readily ascertainable and definable in Mexico than in the U.S. In the U.S. lawyers and business people must supplement what a statute says by pouring over numerous cases interpreting the statute under myriad fact situations. In Mexico, one simply studies the applicable legal provisions and court decisions limited to a very specific area, and makes the best possible argument given the facts and policy concerns. Further, most new law not found in the standard Mexican codes (Civil, Commercial, Tax, Labor, among others) are published as the are enacted in the Diario Oficial, the Official Gazette of the Federation. Also, in the past, most of the important laws in Mexico have been federal, not state, but Mexico is changing. Mexican states are growing more independent from a traditional centralized Mexico, and administrative law has experienced unprecedented growth on the state level.
Additionally, although each state has adopted codes, in the civil areas (not necessarily in the administrative areas) the state codes virtually mirror the codes of the Federal District (D.F.). Conversely, immigration, and environmental laws) are the state laws, although recent decades have seen a creeping tendency to Federalize U.S. law. Another advantage to Mexico's civil law system is that in Mexico, legal procedure is not as important as in the U.S. courts, although in certain types of Mexican proceedings there are strict procedural rules which cannot be ignored.
One should remember, however, that just because Mexican law is less voluminous and in some ways more manageable than U.S. law does not mean that the outcome of its application is always predictable. Just as in the U.S., Mexican judges and regulatory agencies in the administrative areas do exercise their discretion in applying the law to a case, and because they are not usually hampered by precedent as are judges in the U.S., decisions can vary as Mexican judges must find their own interpretation of the law to the facts.
MEXICAN COURTS AND LITIGATION IN MEXICO - When discussing the structure of the court system in Mexico, one must distinguish between courts of "ordinary jurisdiction" (including, civil, commercial and criminal jurisdiction) and administrative courts or courts of "special jurisdiction".
A. Courts of Ordinary Jurisdiction.
Courts of ordinary jurisdiction include federal courts and state courts. At the federal level, the Mexican Supreme Court (Suprema Corte de Justicia de la Nacion) is the highest court in the land and decides the most important cases in the country. Next in the authority and significance are the Circuit Courts (Colegiados de Circuito), which take up cases on appeal and amparo cases. Last are the District Courts (Juzgados de Distrito), which have jurisdiction over amparo cases in the first instance, and which function as courts of ordinary jurisdiction on matters of federal law, such as commercial law cases.
State law establishes the structure and function of the courts in each sate in Mexico and such laws should be consulted on a state by state basis. However, in general terms, state courts are organized in the following manner: the highest appellate court is known as the Superior Court of Justice (Tribunal Superior de Justicia); this court is followed by the Courts of First Instance (Tribunales de Primera Instancia) of ordinary jurisdiction charges with hearing civil, criminal and commercial causes. (It is noteworthy that is commercial matters, dual jurisdiction exists where either federal or state courts of first instance can consider such matters.) Immediately below, are the minor courts of special jurisdiction, such as the family courts and bankruptcy courts (unlike in the U.S., where bankruptcy matters fall under the jurisdiction of federal bankruptcy courts).
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