Judgment no. 24/2018/KDTM-ST dated november 23, 2018 on dispute over claim for repayment and claim for damages

PEOPLE’S COURT OF DA NANG CITY

JUDGMENT NO. 24/2018/KDTM-ST DATED NOVEMBER 23, 2018 ON DISPUTE OVER CLAIM FOR REPAYMENT AND CLAIM FOR DAMAGES

On November 23, 2018, at the office of People’s Court of Da Nang City, a first instance trial was conducted to hear the business case No. 03/2017/TLST-KDTM dated April 24, 2017 on “Claim for repayment” and accept the additional petition No. 03a/2017/TB-TLVA dated October 5, 2018 on “Claim for damages” and accept the additional petition No. 03b/2018/TB-TLVA dated October 5, 2019 on “Claim for late payment interests” according to the Decision to Bring the Case to Trial No. 10/2018/QDXXST-KDT dated October 16, 2018 and Decision to Suspend the Trial No. 08/2018/QDST-DS dated October 25, 2018, between:

1. Petitioner: A Single-Member Limited Liability Company (hereinafter referred to as Company A); address: No. Z, Street Y, District X, Da Nang City.

Authorized representative: Mr. Tran N, born in: 1975; address: No. A, Street B, District H, Da Nang City (based on the Letter of Authorization dated October 29, 2016) (present). 

2. Respondent:  B Limited Liability Company (hereinafter referred to as Company B); address: No. F, Street G, District T, Da Nang City.

Authorized representative: Mrs. Nguyen H; address: No. I, Street S, District H, Da Nang City (based on the Letter of Authorization dated October 28, 2016) (present).

3. Persons with related interests and obligations:

3.1 Enterprise F; address: 20, City T, District H, Republic of Estonia.

Authorized representative: Mrs. Nguyen H; address: No. I, Street S, District H, Da Nang City (based on the Letter of Authorization dated February 20, 2018) (present).

3.2. Mrs. Nguyen C, born in: 1967; address: No. Q, Street F, District H, Da Nang City (2nd absence).

3.3 Mr. Tran M, born in: 1988; address: No. S, Street J, District N, Da Nang City (with Request for Trial in Absentia).

THE CASE

* Representation of Mr. Tran N, authorized representative of the petitioner - Company A in the lawsuit petition dated August 25, 2016, additional petition dated September 20, 2018 and depositions, record of reconciliation and statements made at the court hearing:

Company A and Company B have entered into a Premises and Equipment Lease Contract No. 01/2014/HDTMBTB dated September 26, 2014 (hereinafter referred to as Contract). In which the lessor is Company A and the lessee is Company B; the lease term is 6 months from October 1, 2014 to March 31, 2015 (Clause 1 Article 2 of the Contract); the rent is VND 25,000,000 per month (Clause 1 Article 3 of the Contract) and is paid every 3 months after the lessor issues a financial invoice to the lessee (Clause 2 Article 3 of the Contract).

When the Contract was about to expires, on March 27, 2015, Company A sends the Notice No. 11/TB-BVPN to Company B, notifying the expiry of the Contract on March 31, 2015. After that, Company B handed over the premises and equipment to Company A, which is clearly shown in the record of receiving the leased assets; record of inventory of supplies, products and goods; record of inventory of medical assets of infertility department dated March 31, 2015. Company A issued a VAT invoice for the rent of the remaining 03 months of the contract equivalent to VND 82,500,000.

The debt of VND 82,500,000 has been clearly stated in the Contract but when Company A required Company B to acknowledge the debt, Company B cited the reason that such debt had not been included in its financial statements because the accountant omitted this cost; Company B promised to pay Company A the above debt no later than October 31, 2016. As the debt repayment deadline approached as committed by Company B in the document dated 23/5/2016, on July 4, 2016, Company B suddenly sent to Company A a notice of breach of Contract and requested Company A to pay an amount of VND 82,500,000.  Since this request has no legal basis, Company A did not agree and respond in writing on July 19, 2016 to Company B. In response to this document, Company B sent the document on August 8, 2016, with the content that Company B not only refused to pay the outstanding debt but also forced Company A to compensate for the amount of VND 263,108,335.

Realizing that the willingness to resolve disputes arising between the two parties related to the above debt amount is difficult to resolve by way of negotiation and reconciliation so now with this claim, Company A respectfully requests the Court to consider forcing Company B to pay the debt amount of VND 82,500,000 to us in accordance with the Contract.

In addition, request to Court to force Company B to pay late payment interest to Company A as follows:  VND 82,500,000 x (10% per year) x 30 months = VND 24,700,000 (interest calculated from March 31, 2015 to September 30, 2018). The total amount to be paid by Company B is:  The debt of VND 82,500,000 + interest of VND 24,700,000 = VND 107,200,000.

The petitioner does not agree with the defendant's counterclaim.

* Representation of the authorized representative of the respondent - Company B in the counterclaim dated November 23, 2017, depositions, record of reconciliation as well as statements made at the court hearing:

After receiving the notice of accepting the case No. 03/TB-TLVA of People's Court of Da Nang City dated April 24, 2017 regarding:  Company A has filed a lawsuit petition requesting the Court to force the Company B to pay the 3-month rent of VND 82,500,000 (Eighty two million five hundred thousand dong) to Company A, the defendant does not agree with the petitioner's lawsuit petition and has the following counterclaim:  Company B whose investor is Enterprise F and Company A has a co-investment project in the field of infertility.  Enterprise F and Company A entered into a principal contract for premises lease No. 01/2014 on March 11, 2014.

Under Article 1 of the Contract: the premises for lease is 5th Floor, Building Z, Road Y, District X. Purpose of use: to be a transaction office for the services of infertility examination and treatment by in vitro fertilization (IVF).  Under Article 2 of the Contract: “Lease term: 5 years from the date on which Party B is granted investment certificate by the competent authority”. Based on this Contract, People's Committee of Da Nang City issued an investment certificate for Enterprise F to bring the project into Da Nang in the field of in vitro fertilization.

On the investment certificate No. 321043000227 issued for the first time on July 4, 2014, at "Article 3: Compulsory conditions for the project activities:  After being granted an investment certificate, the enterprise must conclude a premises lease contract with Company A and the contract must be notarized by a legal notarization organization”.

This shows that Da Nang City People's Committee forces Enterprise F to execute the project (IVF) with Company A, not any other company in Da Nang City.  That is the direction and also the condition to execute the project in Da Nang. When Company A terminated the premises lease contract after 6 months of cooperation, it caused great difficulties for Company B, resulting in the termination of the operation of the entire investment project of infertility, caused great damage for Company B and Enterprise F.

The cooperation between Company B and Company A is a long-term cooperation, a 5-year process from the date of issuance of the investment license (July 4, 2014 to July 4, 2019) to perform the project but it is not 6 months as the same as the premises lease contract dated September 26, 2014. The signing of a 6-month contract is only a cooperation of each stage of the project, the contract will be renewed every 6 months but will not be terminated after 6 months.  But in fact, after the first 6-month lease of the 5-year project between both parties, Company A issued a notice No. 01/TB-BVPN on March 27, 2015 asking us to return the premises on the grounds that we could not cooperate further.  Immediately on March 30, 2015, Company A established an inspection team and requested us to hand over the premises including:  technical equipment and personnel sent to training based on the record of receiving leased assets dated March 31, 2015.

Enterprise F invested a large amount of EUR 83,836.87 and USD 125,443.00 according to the capital contribution certificate dated December 31, 2016. The sum of the expenses we have invested is: VND 4,865,243,740 including technical equipment, bringing personnel of Company A to training in the field of in vitro fertilization.  While Company B has not yet executed the project, has not carried on business in the field of infertility, the project was terminated because Company A terminated the lease contract abruptly without prior notice and forced us to hand over the premises after 02 days of notice of termination.  That has caused great damage for Company B in particular and Enterprise F in general.  The total losses that we suffered due to the sudden termination of the project include:

The cost of relocating the head office, making us only perform the representative function in Da Nang and not perform the business function of the enterprise.  We had no revenue, no profit for a long time.  Cost of changing investment registration license due to change of investment registration office: VND 12,000,000 (Twelve million dong) under Economic Contract No. 10/HD-TVDT dated May 26, 2016 between Company B and Da Nang Business Support Center.

Company A also decided to agree to send Dr. C to study under the training program of Company B and stated: Company A will pay basic salary, any cost incurred in training and subsistence, travel, salary paid to employees during the training period will be paid by Company B.  In specific: Company B paid Dr. Nguyen C the total amount of VND 157,433,335 (One hundred and fifty seven million four hundred and thirty three thousand three hundred and thirty five dong).  Company B paid bachelor Tran M the amount of VND 23,175,000 (Twenty three million one hundred and seventy five thousand dong).  The total cost of training is VND 180,608,335 (One hundred and eighty million six hundred and eight thousand and three hundred and thirty five dong) Company A also has a contract with Dr. C regarding matters of training and after training program of Company B.

The total losses that Company B suffered due to the sudden termination of the project include by Company A: Training expenses: VND 180,608,335 + VND 12,000,000 (cost of changing investment certificate) = VND 192,608,335 (One hundred and ninety two million six hundred and eight thousand three hundred and thirty five dong).  Now, Company B requires the Court to force Company A to compensate all above damage to Company B.

The defendant confirmed that it has acknowledged the debt owed for the remaining 03 months’ rent to the petitioner.

* Representation of the authorized representative of Enterprise F in the deposition, record of reconciliation as well as statement made at the trial,:

- For petitioner's claim - Company A:  Force Company B to pay Company A the total amount of outstanding rents of VND 82,500,000 (Eighty two million five hundred thousand dong).  Enterprise F expressed the following view:

We do not agree with the petitioner's claim, because:  the cooperation between the petitioner and Enterprise F is a five-year cooperation in vitro fertilization under the principal contract signed between the representative of Enterprise F and the representative of Company A. This cooperation was approved by the People's Committee of Da Nang City by granting investment certificate to the enterprise invested in Da Nang City. The condition of the investment certificate is: to sign a lease contract with Company A to execute the project.  The petitioner's termination of the co-operation contract after 6 months of lease is a breach of the principal contract, a violation of the investment project approved by the People's Committee of Da Nang City, this termination has caused difficulties and huge material losses for the Enterprise F. Therefore, we do not agree with the petitioner's claim. Company B is a foreign-invested company whose original owner is Company F of the Republic of Estonia under the investment certificate No.321043000227 issued by People's Committee of Da Nang City on July 4, 2014. Address:  head office and project location:  No. Z, Street Y, District X, Da Nang City. Project: Au Chau Reproductive Care Center.  Between Enterprise F and Company A, there is a cooperation in the field of infertility treatment by in vitro fertilization (IVF).  There is an agreement of People's Committee of Da Nang City and Department of Health of Da Nang City on cooperation on treatment of infertility.

At the report dated October 22, 2013 of Company A on the plan to cooperate with Estonia in terms of: Company A will lease out the fifth floor to Global Pharma Group to use as a clinic, partly supporting infertility personnel and specialist degrees , in particular:  Leased premises:  all of offices, labs, IUI rooms in the infertility department and 3 rooms on patients’ demand on the 5th floor of Company A. Partial personnel support:  the current personnel of the infertility department will be transferred to the lessee.  As for the lack of doctors who support the partner in infertility examination and treatment, Company A will recruit them as soon as possible and request the partner to have a training plan.  Cooperation time:  from 03 to 05 years.

Company A has also sent its staff to work in Estonia under the decision No. 57 dated October 22, 2013 of the Director and Deputy Director of the Company A. The entire cost of the trip incurred by the Director and Deputy Director of Company A was paid by Company B, this shows that between Company B and Company A is a long-term cooperation in the field of infertility, rather than merely a 6-month leasing relationship months for the rent as in the petitioner's claim.  Company A also had an application No. 07 dated January 12, 2014 asking Department of Health for permission of additional line of business as land lease with the purpose of: leasing out the premises to Company B to cooperate in the field of in vitro fertilization.

Before investing in Vietnam, Enterprise F and Company A signed the original contract on renting the premises No. 01/2014 on March 11, 2014. Under Article 1 of the Contract:  the premises is 5th floor, No. Z, Street Y, District Y, Da Nang City.  Purpose of use:  to be a transaction office for the services of infertility examination and treatment by in vitro fertilization (IVF).  Under Article 2 of the Contract: “Lease term: 5 years from the date on which Party B is granted investment certificate by the competent authority”. On the basis of this Contract, Company B with 100% foreign owned capital is Enterprise F - Estonia has obtained an investment license issued by the People's Committee of Da Nang City and the business registration certificate was issued for the first time by the Department of Planning and Investment of Da Nang City on July 4, 2014 with the line of business: Activities of specialized obstetric clinic.  Accordingly, between Company B and Company A, there is an association for Company B to carry out the in vitro fertilization treatment at the 5th floor, No. Z, Street Y, District X, Da Nang City of Company A.

- For the counterclaim of the respondent requesting the petitioner "compensation for damages" and the People's Court of Da Nang City accepting the (additional) case No. 03a/2017/TLST-KDTM about "claim for damages".  Company B requires Company A to compensate the entire losses due to the sudden termination of the project of VND 192,609,355, including: the cost of changing the investment registration certificate due to the change of head office is VND 12,000,000, training expense is VND 180,608,355 (training costs for Dr. Nguyen C is VND157,433,335 and bachelor Tran M is VND 23,175,000).

Company B signed a contract to train a doctor who is an employee of Company A, Dr. Nguyen C, No. 01/2014 on August 15, 2014 and Mr. Tran M, a training contract No. 02/2014 on September 15, 2014. Doctor C and bachelor M are all employees of Company A who are transferred to be specially trained in infertility in vitro fertilization, to meet the cooperation between Company B and Company A in the field of infertility. Company A also decided to send Dr. C to study under the training program of Company B and stated:  The hospital will pay basic salary, any cost incurred in training and subsistence, travel, salary paid to employees during the training period will be paid by Company B.  In specific: Company B paid Dr. Nguyen C the total amount of VND 157,433,335 (One hundred and fifty seven million four hundred and thirty three thousand three hundred and thirty five dong).  Company B paid bachelor Tran M amount of VND 23,175,000 (Twenty three million one hundred and seventy five thousand dong).  The total cost of training is:  VND 180,608,335 (One hundred and eighty million six hundred and eight thousand and three hundred and thirty five dong). Company A also has a contract with Dr. C, specifying its permission to send Dr. C to training and maters after completing the training program of Company B.

The whole process and technology in infertility treatment by artificial insemination has been used by Company A.  Two staff members, Dr. C and technician M, are still employees of the A's infertility department when they have been sent to training in August 2014 to the present time - October 2016. All of our expenses which were spent on training have not been recovered, the cost of renting the premises, the cost of investing in equipment brought from abroad to Vietnam which have not been put into use, have not been recovered. They are still unused for the termination of the co-operation of Company A. This termination is too sudden, causing too much damage to our assets and newly-established reputation.  The potential partners, the units that we are planning to cooperate with have looked at the non-cooperation of Company A to not cooperate with us.

Once again, Enterprise F expressed opinion: disagree with the petitioner's claim and agree with the respondent's counterclaim.  We respectfully request the Court to consider and resolve a fair judgment in accordance with the law to return trust to foreign enterprises investing in Vietnam.

* Representation of Mrs. Nguyen C in the deposition dated August 24, 2018:

On August 15, 2014, I was sent by the Company A to train the class "Orientation on fertilization in vitro for the 11th course, academic year of 2014 - 2015". Study time from August 4, 2014 to May 31, 2015. In that course, there is also a collaborator of Company B, under a training contract signed with Company B by Mrs. Nguyen Ky (at that time, Mrs. Nguyen T both was a Deputy Director of Company A and worked for Company B).  Training expenses:  Company A paid me basic monthly salaries during my study.  Company B supported tuition fees, paid a one-way ticket from Da Nang to Sai Gon ...  The total amount is: VND 97,500,000.Company B only provided financial support for a period from September 2014 to February 2015, the remaining study costs from March 2015 to May 31, 2015 Company B does not cover any cost, I had to manage to cover it.  Company B did not notify, did not contact me for the remaining time (March 2015 - May 2015). After finishing the course I was not enabled to work in the learned field of study.  After study time from June 2015 until now, I still have worked for Company A. Company B requires Company A to pay my training expenses as stated in the counterclaim of VND 157,433,335, I propose the court to settle as per the law.

* Representation of Mr. Tran M in the deposition on September 24, 2018:

About September 2014, I was sent to take a course in vitro fertilization at Estonia; with duration of 02 months.  Because of the insufficient required hours of study and interrupt cooperation between Company A and Company B, I do not receive any certificate of course due to insufficient training time.

In November 2014, I returned to Company B to work, after a few months, Company B temporarily stopped operating at the Lease Office of Company A due to a dispute.  After that, Company B and Company A made a document, specifying that Company A would receive me to work at the infertility department.  In June 2016, I resigned from Company A and my resignation was approved by the Director of Company A.  The cost of air tickets, visa fees, advance fee for the course and support for the cost of staying when the aircraft was late are as the same as the list of fees which Company B sent me with a total amount of VND 23,157,000.  Due to busy work, I cannot appear in the Court, request the Court to resolve the dispute in my absence.

JUDGEMENT OF THE COURT

After consideration of the case files assessed and the adversarial process at the court hearing, the Trial Panel considers that:.

[1] In terms of court procedures: Mr. Tran M filed a request for trial in absentia, Mrs. Nguyen C, who was duly summoned by the Court for the second time, is still absent, so  the Trial Panel, based on clause 2 of Article 227 of the Civil Procedure Code, conduct trial of the case.

[2] With reference to content:

[2.1] For Company A's request, claiming Company to pay the debt amount of VND 82,500,000, Trial Panel considers that: On September 26, 2014, One Company A and Company B signed a premises and equipment lease contract No. 01/2014/HDTMBTB.  The lessor is Company A (Party A), the lessee is Company B (Party B); the lease term is 06 months from October 1, 2014 to the end of March 31, 2015.

On March 27, 2015, Company A made a notice, asking Company B to hand over the premises and equipment to Company A after the termination of the Contract.  On March 31, 2015, Company A and Company B made a written record of receipt of leased assets.

On March 29, 2016, Company A and Company B made a written record of debt acknowledgement, Company B stated:  According to the Financial Statements of Company B until December 31, 2015, there is no debt balance mentioned above, Company B will check this amount of debt in 2016.

On May 15, 2016, Company B has a certificate of debts, with the content:  On May 15, 2016, based on accounting documents and books, Company B must pay to the Company A the following:  The debt to be paid VND 82,500,000, equivalent to USD 3,705.

On June 6, 2016, Company A issued Official Letter  No. 21/CV - BVPN "Request to pay the cost of renting premises and equipment of Company A according to the content of Contract No. 01/2014 / HDTMBTB" .

Now, Company A requires the Court to force Company B to pay the debt amount of VND 82,500,000.

And Company B claims that:  Before investing in Vietnam, Enterprise F and Company A signed a principal contract on renting the premises No. 01/2014 on March 11, 2014. Under Article 1 of the Contract, it shows:  the 5th floor, No. Z, Street Y, District Z, Da Nang City.  Purpose of use:  to be a transaction office for the services of infertility examination and treatment by in vitro fertilization (IVF).  The lease term is 5 years from the date on which Party B is granted investment certificate by the competent authority”. The petitioner's termination of the co-operation contract after 6 months of lease is a breach of the principal contract, a violation of the investment project approved by the People's Committee of Da Nang City. , this termination has caused difficulties and huge material losses for the enterprise F. Therefore, Company B disagrees with the petitioner's claim.

In consideration of the claim of Company B, it is found that:  The principal contract on renting premises No. 01/2014 on March 11, 2014 was signed between Enterprise F and Company A, and the premises and equipment lease contract No. 01/2014/HDTMBTB dated September 26, 2014, was signed between Company A and Company B. In Clause 2, Article 2 of the premises and equipment lease contract, it is stated:  Party B is entitled to negotiate to continue renting area ... In this case, Party B must notify Party A to request the extension of the contract.  If both parties want to sign a new contract, they must notify each other at least 01 month in advance.

On March 27, 2015 (4 days before the lease term expires), Company A notified Company B of handover of the premises and equipment after the termination of the Contract. Company B gave no reply and no notice to continue leasing the premises, so on March 31, 2015, Company A and Company B made a written record of receiving the leased assets.

On the other hand, in Clause 1, Article 6 of the premises and equipment lease contract:  This contract establishes all agreements between the two parties and replaces all previous arrangements and commitments.

In addition, in Official Letter No. 4461/UBND-STP dated June 15, 2017 regarding the lawsuit of Company A and Company B, People's Committee of Da Nang City expresses the opinion: "Company A and Company B have two contracts for renting premises:  Principal contract for renting premises (March 11, 2014) and premises and equipment lease contract (September 26, 2014). This is the transaction relationship between the two economic organizations, People's Committee of Da Nang City does not play the role of a third party involved or control any stage of cooperation between the two parties. So, the People's Committee of Da Nang City is not the agency to resolve civil disputes between the parties and the City People's Committee has no opinion on handling disputes between the parties at the Contract before bring the case to trial at the People's Court.  Propose the People's Court of Da Nang City to settle the case in accordance with the jurisdiction and legal regulations ”.

Thus, after the end of the term of the premises and equipment lease contract, Company A sent a notice of the termination of the premises and equipment lease contract No. 01/2014/HDTMBTB dated September 26, 2014 to Company B, but Company B gave no written request to extend the contract.  When the contract expires, the two parties did not sign a contract extension and have handed over the premises and equipment.  On May 15, 2016, Company B made an acknowledgement of debt to Company A of VND 82,500,000.  The Trial Panel finds it necessary to accept Company A's claim to force Company B to pay the debt amount of VND 82,500,000 and in accordance with Clause 1, Article 481 of the Civil Code.

 [2.2] For interest request:

On September 30, 2018, Company A filed an additional petition, requiring the Court to force Company B to pay the interest on late payment: VND 82,500,000 x (10% per year) x 30 months = VND 24,700,000 (calculated from March 31, 2015 to September 30, 2018).In the argument of the first instance trial, the authorized representative of Company B requires the Court to apply the prescriptive period against the interest rate requirement of Company A, as presented by Company A , interest rates are calculated from March 31, 2015 to September 30, 2018. Although Company A claims that March 31, 2015 (the expiry date of the Contract), was the date on which its legitimate rights and interests were violated, but Company A did not file an additional claim for interest until September 30, 2018 (3 years and 6 months later), so the prescriptive period for filing a lawsuit is expired.

Considering the requirement to apply the prescriptive period for initiating a lawsuit regarding the interests of Company A, Trial Panel considers that:  Article 319 of the Commercial Law 2005 stipulates that:  The prescriptive period for initiating lawsuit is two years, so the Trial Panel finds it is necessary to accept request to apply the prescriptive period for initiating lawsuit regarding the interest  against the Fest Company Vietnam in accordance with Article 184 of the Civil Procedure Code. The Trial Panel applies Point e, Clause 1, Article 217 and Clause 3, Article 218 of the Civil Procedure Code, to suspend the settlement of request for calculation of interests of Company A.

[3] For counterclaim:

[3.1] Company B has a counter-claim, forcing Company A to compensate the training costs for Dr. Nguyen C VND 180,608,355 and bachelor Tran T VND 23,175,000, totaling VND 157,433,335.  And Company A said that Company A and Company B have no agreement on cooperation contract, and the training contract for doctor Nguyen C and bachelor Tran T signed between the two parties does not show responsibility regarding Company A, so request the Trial Panel to reject the entire counterclaim of Company B.

Considering the counterclaim request, Company B finds that:

On August 15, 2014, Company B and Mrs. Nguyen C signed a training contract No. 01/2014/HD DT-CT, Company B provided Mrs. C with all training costs for the course:  "Orientation on fertilization in vitro for the 11th course, academic year 2014 - 2015" at Tu Du Hospital, Sai Gon.  In Clauses 4 and 5, Article 3 of the training contract:  After completing the training course, trainees must return to Da Nang City and serve Company B for at least 05 years and be responsible for compensation of 5 times the entire training budget supported by Company B, if the trainee does not abide by the contract.

On September 15, 2014, Company B and Mr. Tran M signed the training contract No. 02/2014/HD DT-CT, Enterprise F supported Mr. M with the entire course cost of the course:  ”Orientation on Embryology - In-vitro-Fertilization" at the University of Science in Republic of Estonia. Training costs and living expenses are sponsored by Enterprise F. In Clauses 4 and 5, Article 3 of the training contract:  After completing the training course, trainees must return to Da Nang City and serve Company B for at least 05 years and be responsible for compensation of 5 times the entire training budget supported by Company B, if the trainee does not abide by the contract.

Thus, Company B signed training contracts with Mrs. C and Mr. M as individuals, not signed a contract with Company A, the training contract only stipulates the liability of Mrs. C and Mr. M as individuals, so there is no basis to force Company A to compensate the training costs of Mrs. C and Mr. M for Company B.

[3.2] Company B has a counter-claim, forcing Company A to pay the cost of changing the investment registration license due to the change of headquarters of VND 12,000,000. Considering this counterclaim of Company B: On March 27, 2015 (4 days before the lease term expires), Company A notified Company B of handover of the premises and equipment at the end of the contract on March 31, 2015, at that time, Company B had no complaint about contract termination. Therefore, there is no ground to force Company A to compensate Company B for the cost of changing the investment registration license due to the change of headquarters.

[4] At the court hearing, the representative of the People's Procuracy of Da Nang City, expresses opinion about the observance of the law observance of the Judges, the Trial Panel, the court reporter, the participants of the proceedings and views on the case as follows:  Accept the petition of Company A and reject a counterclaim of Company B.

Considering the request of the representative of the Procuracy, the Trial Panel considers that:

[4.1] For claim for paying the debt of VND 82,500,000 against Company B and rejection of counterclaim of Company B for damages of VND 192,609,355, the Trial Panel accepts it.

[4.2] For the claim for interest rate for late payment: The People’s Procuracy said that:  According to Official Letter No. 01/05.16/CV dated May 23, 2016, Company B commits:  "has agreed by the investor to pay Company A no later than October 31, 2016”. Beyond the time limit, the petitioner’s claim for the payment of interest on late payment: VND 82,500,000 x 10% year x 30 months = VND 24,700,000 is in accordance with Article 306 of the 2005 Commercial Law; the interest rate on late payment of the petitioner is consistent with the average overdue debt interest rate of commercial banks at the time of first instance trial (the average overdue interest rate is 13%).  Thus, the time that the interest on late payment accrues is from the time when Company B commits to pay Company A no later than October 31, 2016. Therefore, the dispute on interest rate on late payment must begin from November 1, 2016, this time begins to calculate the time limit for initiating lawsuits under Article 319 of the Commercial Law 2005.

Considering the request of the representative of the Procuracy, Trial Panel deems that: On August 25, 2016, Company A filed a lawsuit to the Court. During the process of resolving the case until September 30, 2018, Company A filed an additional petition for interest rate on late payment for the debt of the rent equal to VND 82,500,000.  March 31, 2015 is the expiration date of renting premises and equipment, Company B handed over the premises and equipment, but the rent has not repaid, the, so Company A determines that March 31, 2015 is the date on which its legal rights and interests have been violated and the interest rate on late payment should be calculated from March 31, 2015. However, Company A has not requested a calculation of interest until September 30, 2018 (03 years 06 months later),.  At the argument section, the authorized representative of Company B has requested to apply the prescriptive period for initiating a lawsuit on interest, so the Trial Panel has no valid grounds for applying the prescriptive period as required by the authorized representative of Company B is in accordance with Article 184 of the Civil Procedure Code.  The Procuracy has no valid ground to base on Official Letter No. 01/05.16/CV on May 23, 2016 to recalculate the prescriptive period for filing a lawsuit from November 1, 2016. Because, on May 15, 2016, Company B issued an acknowledgement of debt to the Women's Hospital of 82,500,000 VND (case file p. 17). Official Letter No. 01/05.16/CV dated May 23, 2016 of Company B reiterates once again that the debt payable to Company A is VND 82,500,000, the request of the representative of the Procuracy requires calculation prescriptive period for initiating a lawsuit from November 1, 2016 is not based on the provisions of Article 157 of the Civil Code, so the Panel does not accept it.

 [5] With reference to court fee:

 [5.1] Because the claim for debt payment of VND 82,500,000 of Company A is accepted, Company B must pay the court fee of VND 82,500,000 x 5% = VND 4,125,000. Company A is not liable to court fee.  Refund to Company A the paid advance court fee of VND 2,062,500 according to the receipt No. 0002756 on October 18, 2016 of the Civil Judgment Enforcement Sub-department of District T, Da Nang City.

[5.2] Since the entire counterclaim of Company B is not accepted, Company B must pay the court fee of VND 192,608,355 x 5% = VND 9,630,417.  Since Company B has paid the advance fee of VND 4,815,500 according to the receipt No. 001263 dated December 29, 2017 of the Department of Civil Judgment Enforcement of Da Nang City, Company B must pay the additional court fee of VND 4,814,917 .

[5.3] Since the claim for interest of Company A has expired, Company A does not have to pay court fees. Refund the paid advance court fee of VND 617,500 to Company A according to receipt No. 001521 dated October 1, 2018 of the Department of Civil Judgment Enforcement of Da Nang City.

[6] Regarding the cost of judicial assistance abroad:

Company B must bear the cost of judicial assistance abroad of VND 150,000. Company B has paid VND 150,000 of judicial assistance abroad under receipt No. 001071 dated May 16, 2017 of the Department of Civil Judgment Enforcement of Da Nang City.  Company B has fully paid the cost of judicial assistance abroad.

[7] Regarding actual costs collected by overseas agencies:  Company B does not have to pay them.  Refund Company B VND 3,000,000 according to the receipt No. 001075 dated May 17, 2017 of the Civil Judgment Enforcement Department of Da Nang City.

Pursuant to documents and evidence mentioned above:

HEREBY DECIDES

Pursuant to Clause 2 Article 227; Point e Clause 1 Article 217; Clause 3 Article 218 of the Civil Procedure Code; Clause 1 Article 481 of the Civil Code; Article 319 of the Law on Commerce 2005; Article 26 of National Assembly Standing Committee's Resolution No. 326/2016/UBTVQH14 dated December 30, 2016 on court fees and charges, and exemption, reduction, collection, transfer, management and use thereof.

Accept the "Claim for debt payment" with the rental amount of VND 82,500,000 of Company A to Company B.

Do not accept the counterclaim on "Claim for damages" with the amount of VND 192,608,355 of Company B for Company A.

Suspend the "Claim for interest on late payment" with the amount of VND 24,700,000 of Company A for Company B, judges:

1. Force Company B to pay Company A the amount of the rent equal to VND 82,500,000.

Since the judgment creditor has a request to enforce the judgment until the completed enforcement of the judgment, all the money amounts must be paid every month, the judgment enforcement party shall also have to bear the interest of the remaining amount of money subject to the judgment enforcement, stipulated in Clause 2, Article 468 of the Civil Code 2015.

2. With reference to court fees:

-  Company B must bear the first instance commercial business court fee of VND 4,125,000.

- Court charges for not accepting counterclaim that Company B must bear VND 9,630,417.  Since Company B has paid the advance fee of VND 4,815,500 according to the receipt No. 001263 dated December 29, 2017 of the Department of Civil Judgment Enforcement of Da Nang City, Company B must pay the additional court fee of VND 4,814,917 .

- Refund to Company A the advance payment fee of VND 2,062,500 according to the receipt of No. 0002756 on October 18, 2016 of the Civil Judgment Enforcement Sub-department of District T, Da Nang City.

- Refund the advance payment court fee of VND 617,500 to Company A according to receipt No. 001521 dated October 1, 2018 of the Department of Civil Judgment Enforcement of Da Nang City.

3. Regarding the cost of judicial assistance abroad:

Company B has to pay VND 150,000. Company B has paid 150,000 VND of judicial assistance abroad under receipt No. 001071 dated May 16, 2017 of the Department of Civil Judgment Enforcement of Da Nang City.  Company B has fully paid the cost of judicial assistance abroad.

4. Refund the actual cost Company B VND 3,000,000 according to the receipt No. 001075 dated May 17, 2017 of the Civil Judgment Enforcement Department of Da Nang City.

Litigants have right to appeal this judgment within 15 days from the judgment announcement. Enterprise F that is absent at the trial is entitled to file an appeal within 01 month from the date on which the judgment is properly served or posted up as per the law.

In case the judgment or court decision is enforced as per regulations in Article 2 of the Law on enforcements of civil judgments, 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 and 9 of the Law on enforcement of civil judgments, and the effective period of judgment enforcement shall comply within provisions in Article 30 of the Law on enforcement of civil judgments.


35
  • Name of judgment:
    Judgment no. 24/2018/KDTM-ST dated november 23, 2018 on dispute over claim for repayment and claim for damages
  • Number sign:
    24/2018/KDTM-ST
  • Judgment level:
    Sơ thẩm
  • Field:
    Kinh tế
  • Date issued:
    23/11/2018
  • Key word:
Judgment/Resolution was reviewed
Document was referenced
Document was based
Judgment/Resolution is watching

Judgment no. 24/2018/KDTM-ST dated november 23, 2018 on dispute over claim for repayment and claim for damages

Số hiệu:24/2018/KDTM-ST
Cấp xét xử:Sơ thẩm
Agency issued: Tòa án nhân dân Đà Nẵng
Field:Kinh tế
Date issued: 23/11/2018
Is the source of Legal precedent
Judgment/Resolution First instance
Legal precedent was based
Judgment/Resolution Related to same content
Judgment/Resolution Appeal
Please Login to be able to download
Login


  • Address: 17 Nguyen Gia Thieu, Vo Thi Sau Ward, District 3, Ho Chi Minh City
    Phone: (028) 7302 2286 (6 lines)
    E-mail: info@lawnet.vn
Parent company: THU VIEN PHAP LUAT Ltd
Editorial Director: Mr. Bui Tuong Vu - Tel. (028) 7302 2286
P.702A , Centre Point, 106 Nguyen Van Troi, Ward 8, Phu Nhuan District, HCM City;