Judgement No. 58/2018/DS-ST dated october 30, 2018 on a loan agreement

THE PEOPLE’S COURT OF SOC TRANG PROVINCE

JUDGEMENT NO. 58/2018/DS-ST DATED OCTOBER 30, 2018 ON A LOAN AGREEMENT

On October 30, 2018, at the office of People’s Court of Soc Trang Province, the first instance trial is conducted to hear the case No. 22/2018/TLST-DS dated May 28, 2018 on the loan agreement dispute according to the Decision to Bring the Case to Trial No.  105/2018/QDXXST-DS dated September 19, 2018, between litigants:

- Petitioner:  Co-operative Bank of Vietnam (hereinafter referred to as Co-opBank); address: street H, ward T, district C, Hanoi City.

Authorized legal representative of petitioner: Mr. Le Duy H; residing at: DMQ street, ward 0, city S, Soc Trang province (according to the Letter of Authorization dated September 18, 2018). Mr. H is present.

- Respondent:  Mr. Nguyen Hoang T; place of residence before emigration: village M, commune X, district K, Soc Trang province - emigrated aboard without specific address (absent).

- Person with related interests and obligations: Mrs. Nguyen Thi Thanh L; residing in: village M, commune X, district K, Soc Trang province (absent).

THE CASE

- Representation of the petitioner’s authorized representative, Mr. Le Duy H,  in the lawsuit petition dated November 6, 2017 of the Co-opBank, statements, during the lawsuit settlement process and at the first instance court hearing:

On August 10, 2016, Mr. Nguyen Hoang T (working for District K Youth Union) took out a loan from the Co-opBank - Soc Trang branch of the principal of VND 200,000,000 under the credit agreement No. 182.25/16/HDTD (indebtedness certificate No. TE26500001 dated August 11, 2016), form of loan: monthly income-based unsecured loan, loan tenor: 60 months (from August 10, 2016 to August 10, 2021), variable lending interest rate: 0.88% per month. Loan purpose: family subsistence.

Since the loan date, Mr. T paid interests until January 3, 2017 with total VND 8,442,000, and paid the principal of VND 5,624,900; then, Mr. T did not keep repaying the debt to the Bank. The outstanding principal until the lawsuit date is VND 194,375,100, the provisional interest from January 4, 2017 to the lawsuit date November 6, 2017 is VND 17,447,100. The interest calculated until the first-instance trial date, October 30, 2018, is VND 37,795,000.

So, request the court to compel Mr. T to repay the Co-opBank the principal of VND 194,375,100 and the interest until the first-instance trial date of VND 37,795,000, total principal and interest until the first-instance trial date is VND 232,170,100 (Two hundred thirty two million one hundred seventy thousand one hundred dong). On June 22, 2018, the petitioner filed a supplemental lawsuit petition requesting Mrs. Nguyen Thi Thanh L to incur joint liability with Mr. T to repay the principal and interest to the Bank as Mrs. L, Mr. T’s wife, co-signed the application for drawdown and indebtedness certificate. And the petitioner requests not to bring the District K Youth Union to participate in the legal proceedings since the District K Youth Union approved Mr. T’s application for the loan. However, Mr. T has no longer worked for the District K Youth Union, so the District K Youth Union has no rights and obligations relevant to the case anymore.

At the first-instance court hearing, Mr. Le Duy H requests the court to force Mr. T and Mrs. L to incur joint liability for repaying the Co-opBank the remaining principal of VND 194,375,100 and interest until the first-instance trial date of VND 37,795,000 and request charging interest after the first-instance trial date until the said loan is fully paid off according to the interest agreed in the credit agreement.

- While resolving the case, the respondent, Mr. Nguyen Hoang T, and person with relevant rights and obligations, Mrs. Nguyen Thi Thanh L, give no representation.

- Opinions of the People’s Procuracy of Soc Trang province: Pursuant to Article 262 of the Civil Procedure Code, the representative of the People’s Procuracy of Soc Trang province confirms that during the case acceptance, case settlement and at the court hearing, the Judge, Trial Panel, court reporter and litigants have complied with court procedures as prescribed. Nevertheless, Mr. Nguyen Hoang T and Mrs. Nguyen Thi Thanh L fail to abide by the subpoenas to appear in court. In addition, request the Trial Panel to accept the lawsuit request of the petitioner Co-opBank, compel Mr. T and Mrs. L to incur joint liability for repaying the principal and interest in arrears until the first-instance trial date and the interest accrued during the judgment enforcement process under the credit agreement. As the lawsuit request of the petitioner is accepted, Mr. T and Mrs. L have to pay the first instance civil court fee as prescribed.

JUDGEMENT OF THE COURT

After consideration of the case files assessed and the adversarial process at the court hearing, the Trial Panel judges as follows:

 [1] After accepting the case, the People’s Court of Soc Trang city found out that Mr. Nguyen Hoang T had emigrated abroad before the case acceptance, which means that such a case involving foreign elements shall fall under jurisdiction of the People’s Court of province; therefore, the People’s Court of Soc Trang city referred the case file to the People’s Court of Soc Trang province for resolution as prescribed in Clause 3 Article 26, Point a Clause 1, Clause 2 Article 37 of the Civil Procedure Code 2015 in Viet Nam.

 [2] Although the petitioner’s legal representative is absent, the petitioner’s authorized representative appears in court; the respondent Mr. Nguyen Hoang T and person with relevant rights and obligations Mrs. Nguyen Thi Thanh L are still absent without reason despite being duly served for the second time to appear in first instance hearing. Thus, pursuant to Point a, b Clause 2 Article 227 and Clause 2, 3 Article 228 of the Civil Procedure Code 2015, the Trial Panel conduct the trial in absentia of these people.

 [3] With regard to the lawsuit request of the petitioner to force the respondent Mr. Nguyen Hoang T to repay the Co-opBank the principal of VND 194,375,100. Deeming that, in Article 2 of the credit agreement No. 182.25/16/HDTD dated August 10, 2016, the contracting parties agreed on a loan tenor of 60 months corresponding to 60 repayment installments, in each installment, a fixed amount of principal of VND 2,940,000 shall be repaid on 10^th of each month, the first installment shall fall on September 10, 2016. According to the indebtedness certificate No. TE26500001 dated August 11, 2016, the Bank disbursed VND 200,000,000 to Mr. T. The loan agreement between the Co-opBank and Mr. T was concluded on voluntary, fair, in conformity with laws and regulations and social ethics, to establish rights and obligations of contracting parties in civil transaction, in accordance with Articles 116, Article 117 of the Civil Code 2015; the format and contents of the agreement conform to Article 119, 398, 463 of the Civil Code 2015; the agreement became effective as prescribed in Article 401 of the Civil Code 2015; the prescriptive period for filing a lawsuit associated with the agreement remains effective as prescribed in Article 429 of the Civil Code 2015. Because Mr. T violated the obligation to repay the principal under the credit agreement, the Bank requests the court to compel Mr. T to repay the outstanding principal of VND 194,375,100. This is a grounded request in accordance with Clause 1 Article 466 of the Civil Code 2015 and Clause 1 Article 95 of the Law on Credit Institutions 2010, so the Trial Panel accepts it.

 [4] With regard to the lawsuit request of the petitioner to force the respondent Mr. Nguyen Hoang T to pay the interest until October 30, 2018 of VND 37,795,000. Deeming that, in Article 3 of the credit agreement No. 182.25/16/HDTD dated August 10, 2016, the contracting parties agreed on variable lending interest rate of 0.88% per month, in which the interest rate increases or decreases as may be decided by the Bank (not applying decrease in interest rate if the credit agreement converts to overdue outstanding debt); overdue interest rate is equal to 150% of the interest rate within the term of the loan. Moreover, pursuant to Article 4 of the credit agreement No. 182.25/16/HDTD dated August 10, 2016, if the borrower fails to repay the loan on due date and obtains no approval for extension from the Bank, the Bank shall convert all outstanding debt to overdue debt and the Bank shall charge the overdue interest. Since Mr. T violated the obligation to repay the principal and interest as agreed, the Bank requests payment of the interest until the first-instance trial date, October 30, 2018 of VND 37,795,000; this is a loan agreement with determined term and interest as prescribed in Clause 2 Article 470 of the Civil Code 2015, so the Bank requesting to charge the interest is grounded and in accordance with Point a, b Clause 5 Article 466 of the Civil Code 2015 in Viet Nam and Article 91 of the Law on Credit Institutions 2010 in Viet Nam, so the Trial Panel accepts it.

 [5] With regard to request to force the married couple Mr. Nguyen Hoang T and Mrs. Nguyen Thi Thanh L to incur joint liability for repaying the principal and interest to the Bank. Deeming that the loan purpose mentioned in the credit agreement is for family subsistence and the application for drawdown and indebtedness certificate dated August 11, 2016 also bears the signature of Mrs. L as the wife of the borrower. Therefore, pursuant to Article 27 and Article 37 of the Law on Marriage and Family 2014, there are valid grounded for requiring the married couple Mr. Nguyen Hoang T and Mrs. Nguyen Thi Thanh L to incur joint liability for repaying the debt to the Bank, so the Trial Panel accepts it.

 [6] First instance civil court fee: As the lawsuit request of the Co-opBank is accepted by the Trial Panel, the Bank is not required to pay the first instance civil court fee; since Mr. T and Mrs. L has to repay the debt to the Bank, they are required to the pay the first instance civil court fee in the monetary claim as prescribed in Clause 1 Article 147 of the Civil Procedure Code 2015 and Point b Clause 1 Article 24, Clause 2 Article 26 of Resolution No. 326/2016/UBTVQH14 in Viet Nam dated December 30, 2016. Accordingly, the court fee is VND 11,608,505 (equal VND 232,170,100 x 5%).

 [7] As the request of procurator at first instance court hearing to accept the lawsuit request of the petitioner, the Co-opBank, to force Mr. T and Mrs. L to incur joint liability for repaying the principal and interest accrued until the first-instance trial date and the interest accrued during the judgment enforcement stage under the credit agreement has justifiable grounds, the Trial Panel accepts it.

Based on the above-mentioned facts and matters,

HEREBY DECIDES

Pursuant to Clause 3 Article 26, Point a Clause 1, Clause 2 Article 37; Clause 1 Article 147; Point a, b Clause 2 Article 227; Clause 2, 3 Article 228; Article 271, Article 273 of the Civil Procedure Code 2015;

Pursuant to Clause 1, Point a, b Clause 5 Article 466 of the Civil Code 2015; pursuant to Article 91, Clause 1 Article 95 of the Law on credit institutions 2010; pursuant to Article 27 and Article 37 of the Law on Marriage and Family 2014 in Viet Nam;

Pursuant to Point b Clause 1 Article 24, Clause 2 Article 26 of Resolution No. 326/2016/UBTVQH14 dated December 30, 2016 of Standing Committee of the National Assembly on court fees and charges, remission, collection, management and use thereof.

Hereby judges: 

1. Accept the lawsuit petition of the petitioner, the Co-opBank. Force Mr. Nguyen Hoang T and Mrs. Nguyen Thi Thanh L to incur joint liability for repaying the Co-opBank the outstanding principal of VND 195,375,100 and the interest until October 30, 2018 of VND 37,795,000. Total principal and interest is VND 232,170,100 (Two hundred thirty two million one hundred seventy thousand one hundred dong).

2. Following the first-instance trial date, Mr. Nguyen Hoang T and Mrs. Nguyen Thi Thanh L also incur the overdue interest on the unpaid principal according to the interest rate as agreed in the agreement until this principal is fully repaid. If in the credit agreement, the parties have an agreement on the adjustment of the lending interest rate in each period of the lending bank, the interest rate that the borrower must continue to pay to the lending bank according to the decision the Court will also be adjusted to suit the interest rate adjustment of the lending bank.

3. First instance civil court fee: Mr. Nguyen Hoang T and Mrs. Nguyen Thi Thanh L have to pay the first instance civil court fee of VND 11,608,505. Refund the Co-opBank the paid court fee advance of VND 5,295,000 according to the receipt No. 0008559 dated November 17, 2017 of the Sub-Department of Civil Judgment Enforcement of Soc Trang city.

4. The litigants have right to file an appeal within 15 days from the pronouncement date. Any litigant who is absent from the court hearing or absent at the pronouncement time with valid reasons has right to filed an appeal within 15 days from the date on which the judgment is received or duly served.

In case the judgment or court decision is enforced as per regulations in Article 2 of the Law on Enforcements of Civil Judgments, amended in 2014 of Viet Nam, the judgment creditor and judgment debtor are lawfully allowed to reach an agreement on judgment enforcement, request judgment enforcement, be subject to voluntary execution or coercive judgment enforcement in compliance with regulations in Article 6, 7, 7a and 9 of the Law on Enforcement of Civil Judgments. The effective period of judgment enforcement shall comply within provisions in Article 30 of the Law on Enforcement of Civil Judgments.