Italy Insight: The Covid-19 (Coronavirus) Emergency and Its Impact on Civil Litigation

The alert is available for download with footnotes HERE.

Among the various measures adopted by the Italian Government to deal with the Covid-19 emergency and to support the country's health and economic system, several measures involved civil litigation proceedings as well, causing an inevitable setback of the same by virtue of the entry into force of Law Decree no. 18 of 17 March 2020 ("Italy Care Decree") and Law Decree no. 23 of 8 April 2020 ("Liquidity Decree").

In particular, the measures relating to civil litigation procedures introduced by the aforementioned Law Decrees involve two main areas of interest: the postponement of hearings and the suspension of procedural terms and deadlines.

This path has also been followed by the recent Liquidity Decree, which extended the postponement of court deadlines and the suspension of hearings - originally set forth by the Italy Care Decree until 15 April 2020 - until the subsequent date of 11 May 2020 (the "Measures").

In this regard, in accordance with the same guidelines set out by the Italy Care Decree, the Measures apply: (i) to the terms "for the adoption of judicial measures and for the filing of their motivation, for the submission of briefs/deeds/claims commencing ordinary or enforcement proceedings or appeal procedures and, in general, [a] all procedural deadlines"; (ii) to the terms required to timely serve first instance claims before the competent Tax Commissions, and (iii) to the 90-day deadline for the mediation procedure following the notification of the tax appeal pursuant to Article 17-bis, paragraph 2, Legislative Decree no. 546 of 31 December 1992.

In order to ensure the application of the aforesaid Measures to its maximum extent, the Italy Care Decree has also clarified that the Measures must be considered applicable not only to proceedings which are already pending, but also to proceedings established after its entry into force .

We hereby examine the impact of the Measures on civil litigation proceedings .

The exceptions to the Measures (art. 83, paragraph 3, Italy Care Decree)

Despite the wide extent of the Measures, Article 83 of the Italy Care Decree lists a series of proceedings which fall outside the scope of application of the Measures: these proceedings are characterized by manifest reasons of urgency due to their specific nature , which, therefore, will continue to be treated without being affected by the postponements and suspensions in question.

These include the proceedings relating to the suspension of immediate enforceability of judgments under appeal pursuant to Articles 283, 351 and 373 of the Italian Code of Civil Procedure and, more in general, "all proceedings whose delayed processing may cause serious harm to the parties", thus providing a general rule .

In particular, in order to be able to exclude a certain procedure from the Measures - although not expressly provided for in the list of "exceptions" in Article 83 of the Italy Care Decree - a specific "declaration of urgency" will be required to be issued by the “head of the judicial office or [...] a delegate of the same" to be granted either "by issuing a decree that cannot be subject to appeal or, with respect to cases that have already begun, by way of an order to be issued by the investigating judge or the chairman of the panel, which cannot be subject to appeal as well" .

The term of the Measures established by the Liquidity Decree and the possible adoption of further initiatives

As mentioned above, the Liquidity Decree postponed until 11 May 2020 the period of effectiveness of the Measures.

Therefore, unless further extensions are introduced, the hearings postponed pursuant to the above will be scheduled on dates after 11 May 2020 and the deadlines for the completion of procedural acts which have been temporarily suspended, will resume from that date.

In any case, Article 83, paragraph 7, of the Italy Care Decree, identifies a series of further organisational measures that the heads of the local judicial offices may adopt for the period lapsing between the date of termination of the Measures - i.e., at the moment, from May 12, 2020 - and the date of 30 June 2020 , in order to avoid close encounters and contacts among individuals.

Among these measures - in addition to the possibility of adopting restrictions to the office opening hours and ordering the closure of various services – reference can be made, in particular, to the possibility to further postpone hearings to a date after 30 June 2020, without prejudice to the exceptions mentioned in the previous paragraph .

These measures - and the others listed in paragraph 7 of the provision in question - may also be adopted before 12 May 2020 for judicial activity not suspended as a result of the Measures.

The provisions relating to statute of limitation and forfeiture terms (art. 83, paragraph 8, Italy Care Decree)

Article 83, paragraph 8 of the Italy Care Decree also provides that, for the period of effectiveness of the above mentioned Measures (as well as for the period in which any of the further organizational initiatives referred to in the previous paragraph will remain in force), to the extent that they "preclude the filing of legal action", "the commencement of statute of limitation terms or forfeiture terms applicable to rights which may be exercised exclusively through the performance of the activities precluded by the measures themselves shall be suspended”.

Measures in action: some practical aspects

• Is it possible to file for an injunctive order to pay?

There are no specific provisions restricting the possibility to apply for an injunctive order to pay unpaid dues even in the current emergency context.

In principle, since the injunctive order proceeding does not require a full debate and may be issued also in the absence of the other interested party, thus excluding the need for a hearing, the possibility to file for such order would not seem a priori precluded.

However, the protection normally afforded by an immediately enforceable injunctive order could at the moment be frustrated by the subsequent difficulty of finalizing the necessary service of the injunctive order to pay to the concerned debtor and therefore the impossibility of giving an impetus to the relevant enforcement proceeding (see below).

• Is it possible to obtain a precautionary measure?

With reference to precautionary protection, it should be noted that the Italy Care Decree includes among the exceptions to the Measures only "precautionary proceedings having as their object the protection of fundamental rights of the person".

Therefore, it seems reasonable to infer that, in general, precautionary proceedings are subject to the application of the Measures, while - according to some interpretations - it would be possible to handle precautionary proceedings having as their object the rights listed in the Charter of Fundamental Rights of the European Union.

With regard to emergency measures pursuant to Article 700 of the Italian Code of Civil Procedure, they must be necessarily accompanied by proof of the existence of an "imminent and irreparable damage" that the party would suffer should said party file for an ordinary procedure. In practical terms, such proof could be in some way facilitated by the fact that, in the present emergency context, an ordinary discussion will be postponed to a later date after the expiry of the Measures (and possible extensions of the same).

In any case, it seems necessary to obtain the declaration of urgency pursuant to Article 83, paragraph 3, of the Italy Care Decree mentioned above.

• What remedies can be used to inhibit the enforcement of a guarantee?

Also with reference to procedures aimed at obtaining the enforcement of guarantees and the means to inhibit said enforcement, there are no particular preclusive restrictions in the Italy Care Decree or in the Liquidity Decree. It must therefore be inferred that, in this regard, it should be possible to resort to the aforementioned urgent procedure pursuant to Article 700 of the Italian Code of Civil Procedure, subject to the modalities and clarifications set out in the previous point.

• Is it possible to obtain the vacation of a real estate property?

On this topic, Article 103, paragraph 6, of the Italy Care Decree expressly provides that "the enforcement of measures for the vacation of real estate properties, including non-residential ones, is suspended until 30 June 2020".

• Do the Measures also cover alternative methods of dispute resolution?

Article 83 paragraph 20 of the Italy Care Decree provides that, for the period of validity of the Measures, all terms applicable to any activity relating to mediation proceedings pursuant to Legislative Decree no. 28 of 4 March 2010, assisted negotiation proceedings pursuant to Legislative Decree no. 132 of 12 September 2014, "as well as in all out-of-court dispute resolution proceedings [...] promoted by 9 March 2020", when they "constitute a condition of admissibility of the judicial request", will also remain suspended.

Article 36, paragraph 1, of the Liquidity Decree has expressly extended the above-mentioned suspension until 11 May 2020.

• A practical obstacle: the service of documents

The need to ensure the health and safety of legal practitioners has motivated the adoption, by various offices, of additional organizational measures as allowed pursuant to the Italy Care Decree.

The practical effect of the adoption of these organizational measures has resulted in a greater difficulty, if not in the temporary impossibility, to give impetus to pending legal proceedings as well as to establish others, where it is not possible to resort to electronic service made by lawyers in accordance with the law.

By way of example, the Milan Court of Appeal ruled on 18 March 2020 that: (i) until further notice, only those acts relating to the matters identified in the Italy Care Decree, that cannot be postponed and which are urgent and expire within the following three days, may be submitted for service or enforcement by way of bailiff; and (ii) the proceedings to vacate properties will in any case be suspended until 30 June, 2020.

Moreover, with a note from the President of the Court of Appeal of Milan issued on 19 March, 2020, it has been specified that the actual urgency and the non-deferability of the acts must be assessed from time to time by the Bailiff Office Head.

Attorney advertising. The material contained in this Client Alert is only a general review of the subjects covered and does not constitute legal advice. No legal or business decision should be based on its contents.