Precedent no. 02/2016/AL on dispute over property reclaim

In a case when an overseas Vietnamese who, at his/her cost and expense, acquired transfer of land use right and asked a Vietnamese citizen to put the land use right in the name of that person on his/her behalf is involved in a dispute with such Vietnamese citizen, the Court should have considered that Vietnamese citizen’s contribution to preservation and restoration to increase the value of the land use right; where it is impossible to determine specific contribution, it is supposed to consider that the overseas Vietnamese and the Vietnamese citizen have equal contribution to the increased value of land use right in comparison with its initial value.

Representation of Mrs. Nguyen Thi Thanh in the lawsuit petition dated January 24, 2005, the testimony dated February 7, 2005 and during the lawsuit settlement process:

Mrs. Thanh who is an overseas Vietnamese in Netherland visited relatives in Vietnam with the intent to acquire land use right. On August 10, 1993, she received transfer of land use right of 7,595.7 m2 of agricultural land from the spouses Mr. Heng Tinh, Mrs. Ly Thi Sa Queng in ward 7, Soc Trang town for 21.99 maces of gold. She was the person who directly negotiated and engaged in the transfer and paid gold to the couple. Her purpose was to entrusting the land plot to her full brother Mr. Nguyen Van Tam and Mrs. Nguyen Thi Chinh Em for cultivation to take care of their parents.  Because she is an overseas Vietnamese, she had all transfer paperwork in the Mr. Tam's name. Furthermore, she presented “Certificate of agricultural land transfer” dated August 10, 1993, certified by People's Committee of An Hiep commune. After the transfer completed, she let the spouses Mr. Tam to cultivate the land, but in 2004, Mr. Tam transferred the abovementioned 7,595.7m2 area, without her consent, to Minh Chau Co., Ltd for VND 1,260,000,000.

As for that reason, she asked Mr. Tam to reimburse the proceeds from the transfer of her land use right.

Representation of defendant Mr. Nguyen Van Tam:

The 7,595.7 m2 land in dispute was paid by him and his wife through the transfer transaction between them and Mr. Heng Tinh and his spouse, his name is in the "Agreement on agricultural land transfer” made on August 10, 1993. This certificate does not bear certification of the local government. After that, he and Mr. Henh Tinh and Mrs. Yem also entered into an agreement and made an application for land use right transfer on August 11, 1993, these documents bear approval of the People’s Committee of An Hiep commune and the People’s Committee of My Tu district for such transfer. After the transfer, he registered the land use right certificate on May 28, 1994, so he acquired land use right. Then, in 2004, he transferred the abovementioned land to Minh Chau Co., Ltd for VND 1,260,000,000. He claimed that the “Agreement on agricultural land transfer” made on August 10, 1993, bearing certificate of the People’s Committee of An Hiep commune presented by Mrs. Thanh is fake. Because the Expertise Conclusion No. 2784/C21 (P7) dated October 25, 2005 of Institute of Criminal Science affiliated to General Police Department defines that his signature in that Agreement was forged. Therefore, he contest the lawsuit petition made by Mrs. Thanh.

Representation of person with relevant rights and obligations Mrs. Nguyen Thi Yem (Mr. Tam’s wife): In 1993, she and her husband transferred the land of Mr. Heng Tinh. She was absent from the transfer process but she gave money and gold to Mr. Tam to pay for Mr. Henh Tin and Mrs. Yem, so she contests the petition of Mrs. Thanh.

Mr. Henh Tin and Mrs. Yem, Mrs. Ly Thi Sa Quenh (also known as Ly Thi Sa Venh) who transferred the land all asserted that Mrs. Thanh was the person who directly negotiated and engaged in the transfer, and paid 21.99 maces of gold in person to him and his wife. Mrs. Thanh had the Agreement dated August 10, 1993 in Mr. Tam’s name; their signatures in the Agreement presented by Mrs. Thanh are genuine.

At the first instance civil judgment No. 04/2006/DS-ST dated April 28, 2006, People’s Court of Soc Trang province judged:

Accept a part of Mrs. Nguyen Thi Thanh's petition for reclaiming the sum of land transfer.

Compel Mr. Nguyen Van Tam and Mrs. Nguyen Thi Yem to reimburse VND 630,000,000 to Mrs. Nguyen Thi Thanh.

In addition, the first instance court decided the court fee and expertising fee, and announced the appeal right to litigants as per the law.

On May 10, 2006, Mr. Nguyen Van Tam filed an appeal, claiming that Mr. Thanh did not have the right to the land that he transferred to Minh Chau Co., Ltd, so the judgment made by the first instance forcing him to reimburse VND 630,000,000 to Mrs. Thanh was wrong.

On May 12, 2006, Mr. Nguyen Huu Phong (on behalf of Mrs. Thanh) filed an appeal, requesting the appellate court to compel Mr. Tam to reimburse the transfer amount of VND 1,260,000,000 to Mrs. Thanh.

At the appellate civil judgment No. 334/2006/DSPT dated August 25, 2006, the Appellate Court of People’s Supreme Court in Ho Chi Minh City judged: quash the appeal of the plaintiff and the defendant, and modify the first instance judgment as follows:

Accept a part of Mrs. Nguyen Thi Thanh's petition for reclaiming the sum of land transfer.

Compel Mr. Nguyen Van Tam and Mrs. Nguyen Thi Yem to reimburse VND 27,047,700 to Mrs. Nguyen Thi Thanh, equivalent to 21.99 maces of 24k gold.

Compel Mr. Nguyen Van Tam and Mrs. Nguyen Thi Yem to reimburse VND 1,232,266,860 to the public fund of state.

In addition, the appellate court decided the court fee.

After appellate trial, Mr. Nguyen Van Tam kept claiming the above appellate civil judgment.

At the Decision No. 449/2009/KN-DS dated August 21, 2009, Chief Justice of the Supreme People’s Court appealed the appellate civil judgment No. 334/2006/DSPT dated August 25, 2006 of the Appellate Court of the Supreme People’s Court in Ho Chi Minh City, requesting the Council of Judges of the Supreme People’s Court to hear the case under cassation procedure, quashing the above appellate judgment and quashing the first instance judgment No. 04/2006/DSST dated April 28, 2006 of People’s Court of Soc Trang province; referring the case file to the People’s Court of Soc Trang province for first instance re-trial as per the law, with the following judgment:

“Mrs. Nguyen Thi Thanh sued Mr. Nguyen Van Tam for reclaiming her property, claiming that she is an overseas Vietnamese so she asked Mr. Tam (her brother) to receive transfer of land of Mr. Henh Tin and Mrs. Yem in his name on behalf of herself, but then Mr. Tam transferred that land plot to a third party.

The first instance court and the appellate court judged that Mr. Tam only had his name on the land transfer paperwork on behalf of Mr. Thanh and it was deemed well-grounded.

Because Mrs. Thanh is an overseas Vietnamese, she will not be allocated the land plot, she only receives back the amount of the transfer value.

With regard to the land value difference, during the first-instance trial and appellate trial the Civil Code 2005 was being in force and there was no regulation stipulating that such a difference must be transferred to the public fund of state; therefore both Mrs. Thanh and Mr. Tam will receive this difference. The first instance court had valid ground not to compel Mr. Tam to reimburse the land value difference to the public fund, but it was wrong when not compelling Mr. Tam to reimburse the initial transfer value to Mrs. Thanh. The appellate court was wrong when compelling Mr. Tam to reimburse the difference of VND 1,232,226,860 to the public fund of state without citing any legal basis".

At the cassation trial, the representative of the People’s Supreme Procuracy requested the Council of Judges of the Supreme People’s Court to accept the appeal made by the Chief Justice of the Supreme People’s Court, quash the above appellate judgment and the first instance judgment No. 04/2006/DSST dated April 28, 2006 of People’s Court of Soc Trang province; refer the case file to the People’s Court of Soc Trang province for first instance re-trial as per the law.

Mrs. Nguyen Thi Thanh sued Mr. Nguyen Van Tam for reclaiming VND 1,260,000,000, claiming that she was the person who directly engaged in and paid money for the transfer of 7.595,7m2 land of Mr. Henh Tin and Mrs. Yem. Although she asked Mr. Tam (her brother) to have his name on the transfer paperwork because she is an overseas Vietnamese, Mr. Tam intentionally transferred the above land plot to Minh Chau Co., Ltd for VND 1,260,000,000 without her consent.

Mr. Tam stated that the reason the land transfer paperwork was in his name was simply that he directly engaged in the transfer and paid money to Mr. Heng Tinh. After the transfer, he directly cultivated the land and registered the land use right certificate. And then when his transfer of land to Minh Chau Co., Ltd was also permitted by the authority, so he contests the petition of Mrs. Thanh.

However, during settlement of the case, Mr. Tam and Mrs. Yem had many contradictory statements about the money and gold paid to Mr. Heng Tinh and Mr. Tam failed to demonstrate the origin of that gold.

On the other hand, Mr. Tinh and Mrs. Quenh asserted that they only reached an agreement on land transfer with and received gold from Mrs. Thanh, and the land transfer paper in Mr. Tam's name was made at the request of Mrs. Thanh because she was living abroad.

Based on testimonies of Mrs. Thai Thi Ba, Mr. Nguyen Phuoc Hoang, Mrs. Nguyen Thi Chinh Em (mother and full brother and sister of Mrs. Thanh and Mr. Tam), they confirmed that Mrs. Thanh engaged in the transfer and paid money to Mr. Tinh and his wife, Mr. Tam only had his name on the land transfer paper.

According to all items of evidence, it is well-grounded to declare that the first instance court and the appellate court were right when determining that Mrs. Thanh paid 21.99 maces of gold for the land transfer and Mr. Tam only had his name on the transfer paper. Because Mr. Tam transferred the land plot to Minh Chau Co., Ltd and Mrs. Thanh only requested Mr. Tam to reimburse the transfer value of VND 1,260,000,000, the acceptance of the first instance court and appellate court to hear the case was in compliant with the law.

Although Mrs. Thanh paid 21.99 maces of gold for the land transfer (equivalent to VND 27,047,700), the land transfer paper was in Mr. Tam's name and then Mr. Tam managed that land plot and transferred it to a third party thereafter. Accordingly, the court was supposed to determine that Mr. Tam made efforts to preserve and enrich the land value, so the above sum of money (after deducting the initial amount of 21.99 maces of gold of Mrs. Thanh) is the common profit between Mrs. Thanh and Mr. Tam. Furthermore, the court was supposed to determine Mr. Tam’s proportion in the common earning based on his efforts to ensure the compliance with law and the interests of litigants (If it is unable to determine the correct proportion, the common earning should be equally divided).

The first instance court was wrong when recognizing that Mrs. Thanh and Mr. Tam each have the right to own half of the money but failing to returning Mrs. the sum equivalent to 21.99 maces of gold.

The appellate court went against the Civil Code 2005 and failed to ensure the interests of litigants when solely recognizing that Mrs. Thanh has the right to own the sum equivalent to 21,99 maces of gold but expropriating the remaining sum to the public fund of state.

In addition, while Mrs. Thanh sued Mr. Tam for reclaiming VND 1,260,000,000 which is the sum of money Mr. Tam transferred the 7.595,7m2 land without dispute over land use right, Mr. Tam claimed that that sum of money belongs to him. Accordingly, litigants disputed the property ownership which is the above sum of money. However, the first instance court and the appellate court determining that the legal relation here was “dispute over reclaiming property” was wrong.

According to facts and matters, pursuant to Clause 3 Article 297 and Article 299 of the Civil Procedure Code;

”Although Mrs. Thanh paid 21.99 maces of gold for the land transfer (equivalent to VND 27,047,700), the land transfer paper was in Mr. Tam's name and then Mr. Tam managed that land plot and transferred it to a third party thereafter. Accordingly, the court was supposed to determine that Mr. Tam made efforts to preserve and enrich the land value, so the above sum of money (after deducting the initial amount of 21.99 maces of gold of Mrs. Thanh) is the common profit between Mrs. Thanh and Mr. Tam. Furthermore, the court was supposed to determine Mr. Tam’s proportion in the common earning based on his efforts to ensure the compliance with law and the interests of litigants (If it is unable to determine the correct proportion, the common earning should be equally divided).”

1- Overrule the appellate civil judgment No. 334/2006/DSPT dated August 25, 2006 of Appellate Court of the Supreme People’s Court in Ho Chi Minh City and the first instance civil judgment No. 04/2006/DSST dated April 28, 2006 of People’s Court of Soc Trang province regarding the dispute over reclaiming property between the plaintiff Mrs. Nguyen Thi Thanh and the defendant Mr. Nguyen Van Tam; person with relevant rights and obligations Mrs. Nguyen Thi Yem.

2- Refer the case file to People’s Court of Soc Trang Province for re-conducting the first-instance trial as per the law.