Derecho literally translates to "right", in the sense of a legal or moral entitlement to something. It is a common word on its own, but its repeated, almost accusatory use throughout this song is what makes it so striking.
The song's title, "Con Qué Derecho" ("By What Right"), sets the tone for lyrics that keep questioning someone's right to disturb the singer's peace. The line "Con qué derecho habita es mi vida y" ("with what right dwells is my life and") shows that confrontational, questioning tone clearly.
Have you ever felt like someone has completely taken over your life, even if they're not physically there? That's exactly what Los Angeles de Charly are singing about in "Con Qué Derecho"! This song is a passionate, almost desperate, plea to a person who has invaded the singer's thoughts and dreams.
The singer asks, "Con qué derecho habitas mi vida?" [By what right do you inhabit my life?] and complains that this person distracts them even on the terrace of their fantasies. It's like this person is always there, even in their sleep, becoming "el más grande" [the greatest] in their dreams. But then the singer asks, "con qué derecho te duermes con ritmo y me despiertas en nuestro mundo vivo?" [by what right do you fall asleep with rhythm and wake me up in our living world?] and feels alone because this person isn't with them. They feel robbed of their calm and soul, saying, "me quitas la calma, te llevas mi alma" [you take my calm, you take my soul]. The song is all about the overwhelming feeling of someone taking over your mind and heart, even when they're absent.