Representation of the plaintiff, A Joint-Stock Commercial Bank, in the lawsuit petition dated October 6, 2011 and statements made at the court:
On June 16, 2008, A Joint-Stock Commercial Bank (hereinafter referred to as the Bank) and B Co., Ltd (hereinafter referred to as Company B) concluded a credit agreement No. 1702-LAV-20080142, thereby the Bank grants Company B a loan of VND 10,000,000,000 and/or equivalent foreign currency. Purpose of extending credit: raise additional working capital for operation of the registered line of business of Company B.
Executing the agreement, the Bank disbursed total VND 3,066,191,933 to Company B according to the credit agreements cum contracts of indebtedness. Up to October 5, 2011, Company B’s principal and interest in 3 contracts is VND 4,368,570,503 (including VND 2,943,600,000 of principal and VND 1,424,970,503 of interest).
The collateral for above loan comprises the houses and land (land plot No. 43, map No. 51-1-33 (1996) at 432, group 28, ward E, district H, Hanoi City under right to own and use of Mr. Tran Duyen H and Mrs. Luu Thi Minh N (according to the certificate of housing ownership and residential land use right No. 1010 (Processing and preserving of meat and meat products); issued by the People’s Committee of Hanoi City on December 7, 2000), pledged by Mr. Tran Duyen H and Mrs. Luu Thi Minh N under the mortgage agreement of land use right and property on land dated June 11, 2008. The mortgage agreement was notarized by Public Notary Office 6 in Hanoi City on June 11, 2008 and the Department of Natural Resources and Environment certified registration of secured transaction on June 1, 2008.
On October 30, 2009, the Bank and Company B kept continuing the credit agreement No. 1702-LAV-200900583, thereby the Bank grants Company B a loan of USD 18,000. The purpose of loan: payment of freight of export shipment; loan term of 09 months; interest rate of 5.1% per year; overdue interest rate of 150%.
Executing the agreement, the Bank disbursed fully USD 180,000 to Company B. Company B has just repaid the Bank the principal of USD 100,750 and the interest of USD 1,334.50. Up to October 5, 2011, Company B still be in arrears with the principal of USD 79,205 and the interest of USD 16,879.69, totaling USD 96,120.69.
The collateral for the loan under the credit agreement No. 1702-LAV-2009058 includes:
- The shipment of 19 trucks, load capacity: 1.75 tonne, JMP model, brand new, value of VND 2,778,750,000 (assembled by Company B according to the good in storage method, the Bank kept the certificate of roadworthiness of these trucks) which was pledged by Company B under the mortgage agreement No. 219/2009/EIBHBT-CC dated October 29, 2009. This mortgage agreement was registered as secured transaction by the Department of Registration of Secured Transaction in Hanoi City on November 2, 2009;
- The balance of the 3-month deposit account of VND 1,620,000,000 made at the Bank. Because Company B has repaid partial debt, the Bank release of VND 1,620,000,000 in the saving deposit of Company B, equivalent to the repaid amount of the debt.
At first instance court hearing, the representative of the Bank certifies that: As for the loan of USD 180,000, Company B has fully repaid the principal, and just owed the interest of USD 5,392.81; with regard to 19 trucks as collateral, 18 in which were sold, 1 truck remains unsold; request the Court to finish selling such remaining truck to collect the debt in arrears.
The Bank requires the Court to compel Company B to:
- pay the principal and interest in VND under the credit agreement No. 1702-LAV-200800142 of VND 4,368,570,503;
- pay the interest of USD 5,392.81 under the credit agreement No. 5.392,81 of VND 1702-LAV-200900583.
Where Company B fails to repay or fails to repay fully, request the Court to sell the collateral, including:
- House ownership and residential land use right at 432, group 28, ward E, district G, Hanoi City of Mr. Tran Duyen H and Mrs. Luu Thi Minh N;
- 01 truck, load capacity: 1.75 tonne, JMP model, brand new, assembled by Company B under the mortgage agreement No. 219/2009/EIBHBT-CC dated October 29, 2009.
Representation of Mr. Tran Luu H1 - Director General of Company B, representative of the defendant: Acknowledge the principal, interest and collateral as stated by the Bank but request the Bank to defer the repayment.
Representation of persons with relevant rights and obligations, Mr. Tran Duyen H and Mrs. Luu Thi Minh N: They confirm they concluded the mortgage agreement of the houses and land No. 432 to secure the loan up to VND 3,000,000,000 of Company B. The mortgage agreement was notarized and registered as secured transaction. Mr. Tran Duyen H and Mrs. Luu Thi Minh N also helped Company B to repay about VND 600,000,000 of the loan secured by their house and land. They request the Bank to extend the debt of Company B in order for it to recover business and settle the debt to the Bank; request the Court not to summon his son, daughter-in-law, daughter, son-in-law to the trial.
Representation of Mr. Tran Luu H2, representing children and grandchildren of Mr. Tran Duyen H, Mrs. Luu Thi Minh N who are living at 432:
In later 2010, he knew that his parents put up their house and land as security for the loan of Company B. After Mr. Tran Duyen H and Mrs. Luu Thi Minh N were granted the certificate of house ownership and residential land use right in 2000, Mr. Tran Luu H2 and Mr. Tran Minh H spent their money on building a 3.5-storey house on land and 16 members in the family are living there. When concluding the mortgage agreement, the Bank did not ask them for opinions. Therefore, he requests the Court not to recognize the mortgage agreement and consider VND 550,000,000 they repaid on behalf of Company B under the credit agreement secured by the houses and land at 432, but the Bank arbitrarily recorded such repayment to the loan in foreign currency secured by 19 trucks, that is an improper action.
In the First Instance Civil Judgment No. 59/2013/KDTM-ST dated September 24, 2013, the People’s Court of Hanoi City judged:
- Accept the lawsuit petition of A Joint-Stock Commercial Bank against B Co., Ltd.
- Compel the Company B to repay the Bank A the debt in arrears under the credit agreement No. 1702-LAV-200800142, including: VND 2,813,600,000 of principal, VND 2,080,977,381 of interest within the term of the loan; VND 1,036,575,586 of overdue interest until September 23, 2013; VND 123,254,156 of interest on late payment until sep 23, 2013; totaling: VND 6.054.407.123.
- Compel the Company B to repay the Bank A the debt in arrears under the credit agreement No. 1702-LAV-200800583, including USD 5,392.81 of overdue interest.
If Company B fails to repay or fails to repay fully the debt in arrears under the credit agreement No. 1702-LAV-200800142, the Bank A has the right to request Department of Civil Judgment Enforcement of Hanoi City to sell the collateral as per the law, including the house ownership and land use right at the land plot No. 43, map No. 5I-I-33 (1996) according to the certificate of house ownership and residential land use right No. 1010 7490390 granted by the People’s Committee of Hanoi City on December 7, 2000 to Mr. Tran Duyen H and Mrs. Luu Thi Minh N at the address 432, group 28, ward E, district H, Hanoi City to collect the debt…
If Company B fails to repay or fails to repay fully the debt in arrears under the credit agreement No. 1702-LAV-200800583, the Bank A has the right to request Department of Civil Judgment Enforcement of Hanoi City to sell the collateral being 1 truck, load capacity of 1.75 tonne, JMP model assembled by Company B under the mortgage agreement No. 219/2009/EIBHBT-CC dated October 29, 2009 to collect the debt.
In addition, the Court of First Instance decided the court fee and announced the appeal right to litigants as per the law.
After first instance trial, the defendant and the persons with relevant rights and obligations all appealed the First Instance Judgment.
The Appellate Judgment No. 111/2014/KDTM-PT dated July 7, 2014, the Appellate Court of People’s Court of Ho Chi Minh City decides:
Uphold the decision of First Instance Judgment No. 59/2012/KDTM-ST dated September 24, 2013 of People’s Court of Hanoi City on the credit agreement, regarding the loan and amount payable by Company B to the Bank A; quash the decision of First Instance Judgment No. 59/2013/KDTM-ST dated September 24, 2013 of People’s Court of Hanoi City in terms of the mortgage agreement and security of the third party, in specific:
... Quash the decision in terms of mortgage agreement of land use right and property on land owned by the third party (the houses and land No. 432, group 28, ward E, district G, Hanoi City) notarized by Public Notary Office 6 in Hanoi City on June 11, 2008 and registered as security by Department of Natural Resources and Environment of Hanoi City on June 11, 2008…
Refer the case file to People’s Court of Hanoi City to take further verification, take evidence and conduct re-trial, determine legal assets owned by Mr. Tran Duyen H and Mrs. Luu Thi Minh N as collateral of Company B for the loan at the Bank A under the credit agreement No. 1702-LAV-200800142 dated June 16, 2008.
In addition, the appellate court decided the court fee.
After appellate trial, the Bank and People’s Court of Hanoi City filed written requests to review the Appellate Judgment under cassation procedure.
In the appeal under cassation procedure No. 14/2016/KDTM-KN dated April 12, 2016, the Chief Justice of the Supreme People’s Court appealed Appellate Judgment No. 111/2014/KDTM-PT dated July 7, 2014 of the Appellate Court of the Supreme People’s Court of Hanoi. Request the Council of Judges of the Supreme People’s Court to quash the Appellate Judgment No. 111/2014/KDTM-PT dated July 7, 2014 of the Court of Appeal of the Supreme People’s Court in Hanoi and First Instance Judgment No. 59/2013/KDTM-ST dated September 24, 2013 of People’s Court of Hanoi City; refer the case file to People’s Court of Hanoi City to retry as per the law.
At the cassation trial, the representative of the Supreme People’s Procuracy concurs with the appeal of the Chief Justice of the Supreme People's Court, requests the Council of Judges of the Supreme People’s Court to quash the Appellate Judgment, refer the case file to Superior People’s Court of Hanoi City for appellate re-trial.