Legal Consciousness and the Belittlement of Insolvency Law: A Case Study of Portuguese Judicial Proceedings

This paper presents the main findings of a qualitative analysis of Portuguese case law in insolvency and pre-insolvency proceedings, conducted as part of the IN_SOLVENS research project. The study reveals significant shortcomings in the application of insolvency law, highlighting procedural inertia, disengagement by parties, insufficient data on debtors, and the reinforcement of both epistemic and social vulnerabilities.

Framing these findings within a broad notion of legal consciousness, which encompasses both internal and external legal perspectives, this study argues that insolvency law is systematically disregarded by legal actors—judges, attorneys, and even the individuals involved as parties to the proceedings. This disregard reflects not only the traditional stigma associated with insolvency but also an overarching legal obliviousness. Courts and legal professionals often display a lack of interest and engagement with the socio-political goals underlying insolvency law, contributing to its downplaying as a secondary or less important legal field.

Through this lens, we observe how both everyday and professional legal consciousness are shaped by absences and voids, reinforcing the estrangement of ordinary individuals from the law. In particular, the procedural disengagement observed in the courts—alongside parties' own inertia—suggests a deeper detachment, where the potential of insolvency law to restructure financial and social vulnerabilities is overlooked. This contributes to a broader belittlement of insolvency law, perpetuating the very vulnerabilities it seeks to address.