Verdict 04/2019/DS-ST dated september 13, 2019 regarding civil contract dispute

PEOPLE’S COURT OF VU THU DISTRICT – THAI BINH PROVINCE

VERDICT 04/2019/DS-ST DATED SEPTEMBER 13, 2019 REGARDING CIVIL CONTRACT DISPUTE

On September 13, 2019, at its courtroom, the People's Court of Vu Thu district, Thai Binh province conducted the open first instance trial of the case number: 05/2018/TLST-DS entertained on June 27, 2018 regarding the guarantee contract dispute under the Decision to try the case No.: 04/2019/QDXXST-DS dated August 7, 2019 and the Decision to adjourn the trial No.: 04/2019/QDST-DS dated August 28, 2019 between litigants:

- Plaintiff: Limited liability company F;

Address: No. XX, building XY, N, ward T, district H, Hanoi.

Legal representative: Mrs. Tran Thi L, born in 1976, title: Company’s Chief Executive Officer.

Authorized representative: Mrs. Nguyen Thi T, born in 1991; address: Block YY, Industrial Park V, ward H, district H, Hanoi. Title: Staff member of the company F.

 (According to the Power of Attorney No. 20/3/2019 dated March 20, 2019)

- Defendant: Mr. Nguyen Huu N, born in: 1966.

Residence address: H village, X commune, V district, Thai Binh province.

- Other persons with associated rights and obligations:  Mr. Nguyen Huu T, born in 1990;

Residence address: H village, X commune, V district, Thai Binh province.

 (Mrs. L: present; Mr. N and Mr. T: absent)

CASE SUMMARY

*/ According to the petition to sue dated April 5, 2018, the personal statements, documents and evidence presented, and at the trial, the plaintiff and the authorized representative of the plaintiff spoke as follows:

International Human Resource Training and Development Co., Ltd. (hereinafter referred to as Company F), licensed by the Minister of Labor, War Invalids and Social Affairs to send workers overseas on June 23, 2017, has signed a service contract to send trainees to take a skill improvement internship program in Japan No.: 103/HD DVPC dated July 31, 2017 with Mr. Nguyen Huu T, under which Mr. T would be sent to Japan to study and practice his skills at Nakamura Toso company under the control of Fuan Kuodo Kumiai corporation. Contract performance duration is 01 year of Level I internship and 02 years of Level II internship (Total duration is 03 years). On August 3, 2017, in order to bind the trainee to observe the contract, Mr. Nguyen Huu T and Mr. Nguyen Huu N signed a contract with Company F to guarantee his liability for compensation for any loss or damage arising from the runaway trainee during his internship period in Japan which values VND 100,000,000.

On August 17, 2017, Mr. T entered Japan to take that internship program. During his internship, Mr. T used the Company's phone to make long-distance calls, which totaled 36,600,000 VND on the bill, but did not pay the bill. On March 14, 2018, Mr. T left work without permission, unilaterally terminated the contract and violated the contract signed with the Company. Immediately after Mr. T fled, the company informed the local authority at his registered permanent residence and his family, and also contacted the guarantor Mr. Nguyen Huu N to collaborate in persuading Mr. T to return to workplace or in finding proper measures to support Mr. T to deal with any problem. However, Mr. N and T’s family did not liaise with the Company to do so. After not receiving any information and feedback from Mr. T and his family, on March 14, 2017, the Fuan Union kuodo Kumiai corporation made an official notice of T’s runaway case to the Nagoya Department of Immigration, Center for Community Benefits - International Training Cooperation. Mr. T’s runaway case caused great loss and damage to the Company, affecting the company’s image and reputation, and was asked by the Japanese partner to pay compensation due to this runaway case. There was a March 14, 2018 report on Mr. T’s runaway case in which the trainee was reported to have left his place of residence without any further information by the supervisory corporation: Fuan jigyo Kyodo Kumiai, to the receiving authority: Nakamura Toso to which T roommate and N, himself, testified.

Pursuant to Article 1 of the guarantee contract for the liability to pay damages for the fleeing act of employee during their working time in Japan, Company F requests the People's Court of Vu Thu district:

1. To force Mr. Nguyen Huu N to pay the compensation amount of VND 36,600,000 to the Company for his telephone bill so that the Company can pay it to the Japan Post.

2. To force Mr. Nguyen Huu N to reimburse the amount of VND 100,000,000 for the August 3, 2017 contract to guarantee his liability for compensation for any loss or damage arising from the fleeing act committed by Mr. Nguyen Huu T who is Mr. N's son during his internship period in Japan.

On August 1, 2018, the plaintiff withdrew the petition for compensation of VND 36,600,000 telephone bill that T incurred in order for the Company pay the Japan Post.

Regarding Company F’s loss or damage arising from T’s fleeing act: Under terms and conditions of the contract to send worker abroad concluded on July 31, 2017, when entering the country, the trainee is entitled to an allowance of 60,000 yen, which is a 12-month support for studying language and skills. However, because the trainee only stayed at the receiving agency for 07 months, the amount having to be refunded to the Receiving Agency is defined as 60,000 yen / 12 x 5 = 25,000 yen, equivalent to 5,241,000 VND; When the trainee fled, the receiving agency needs to hire native people to do the job and the common salary of Vietnamese workers in Japan is 132,300 yen a month. The basic salary to be paid to a Japanese worker is 180,000 yen. Thus, the difference amount (180,000 yen - 132,300 yen) x the remaining 5-month period of 01 year of Level-I internship contract is 238,500 yen, equivalent to 50,006,000 VND. Rent 20,000 yen/month, 05 months x 20,000 yen = 100,000 yen, equivalent to 20,967,000 VND. The flight fare and hotel room for the receiving agency's staff’s entrance in Vietnam to conduct direct interview with the trainee is 23,786,000 VND. Total compensation that the company has to pay to the receiving agency in Japan is 100,000,000 VND. However, the company suffered a loss of reputation and damage due to the violation of the proportion of runaway workers, resulting in adverse impacts on the Company's services because of the fact that the Company's license may be revoked or withdrawn owing to the high proportion of runaway workers. However, the Company only required Mr. N to compensate the Company for the amount of VND 100,000,000 as agreed upon in the signed guarantee contract.

*/ According to the record of testimony and evidence presented at the Court, at the mediation session, the defendant Mr. Nguyen Huu N spoke: He confessed that he had signed the guarantee contract with Company F. Before signing, he carefully read the contract, but was explained by the company's lawyer that signing was just a formality. However, while working in Japan, because Company F did not meet agreed-upon working and pay conditions, Mr. T had to go out to work and was deported back to his home country. That was an unexpected situation. He also asked the Company to take responsibility to his son and his family because his son and his family bore serious consequences for this situation. He suggested the Company to clarify its responsibilities to Mr. T and his family. Up to now, he are having no money to compensate the Company. He asked the Company to pay him 7,500 USD (converted into Vietnamese dong for payment), which is the cost that Mr. T has paid to the Company to complete procedures for Mr. T’s being sent to Japan to become a trainee. In this regard, the Court asked him to provide evidence many times to prove his request. However, due to his family’s condition, he had not come to deliver evidence. In fact, the payment invoice is currently in his possession but, for a long time, as he could not preserve it, the invoice has lost all the words inscribed on it. This means that he has nothing to submit to the Court.

He did not agree to the plaintiff's petition to sue. The company signed a contract to send trainees to Japan but did not guarantee the working and pay conditions for workers, making Mr. T and many other cases, like Mr. T, have to leave, including Mr. Nguyen Van N living at N village, N commune, T district, Bac Ninh province. The Company sent a notice of unilateral termination of the labor contract with Mr. T so the guarantee between him and the Company is no longer valid.

*/ In the record of testimony dated October 10, 2018, Mr. Nguyen Huu T made the following statement: He moved to Japan to work under the contract signed with Company F. After the expiry of the 1-year term, he returned to Vietnam so he did not violate the contract, and he did not accept the Company's petition to sue of the Company. When he got home, his father informed him that the company was suing for the guarantee sum. At this stage, the Court entertained the petition to sue and sent required papers to his father, care of him. He had neither connection and regard to the Company because the Company had unilaterally terminated his contract. He did not receive or read any documents served by the Court. He asked the Court not to send papers and bother his family anymore. Mr. T submitted to the Court 01 Notice No. 129 dated October 5, 2018 of Company F pertaining to its unilateral termination of the service contract to send the trainee to the skill internship program in Japan and 01 report on unilateral termination of this contract dated October 5, 2018.

* Company F made the following arguments: The company does not accept Mr. N's request for reimbursement of 7,500 USD and has no financial relationship with Mr. N because the company did not collect any money from Mr. N. In addition, the Company wanted to make it right that the Company did not collect 7500 USD from Mr. T because the Company must made a receipt after collection and only collected the money in accordance with law. Mr. T also had no idea about the Company's fee collection. Whenever Mr. T files a petition to sue, the Company will participate in this legal action to clarify the issue. The company sent staff to Japan to solve all problems from workers but the Company did not receive any comments from Mr. T about the salary and working conditions. Therefore, Mr. N's statement that the Company sent Mr. T to Japan to work without assure job and salary conditions is frivolous. The workers working at the same workplace as Mr. T’s are still there and work. The Company's issuance of the notice and report of unilateral termination of the contract with Mr. T complied with the provisions of the Law on Sending Vietnamese People to Work Abroad. This is not related to the validity of the guarantee contract with Mr. N.

*/ At the trial, the representative of the People's Procuracy of Vu Thu district, Thai Binh province had its own perspectives: Judge and Trial Panel strictly complied with the Civil Procedure Code in the course of approaching the case. The plaintiff complied with the law in the course of participating in the proceedings while the defendant obeyed a part of the civil procedure law. In terms of court judgement on the case: Petitioning the Trial Panel to consult Articles 335, 336, 339, 340, 342 of the Civil Code; Clause 8, Article 7, Article 54, 55, 56, 57 of the 2006 Law on Sending Vietnamese Workers Abroad Under Contracts. Petitioning the Court to accept the lawsuit petition of Company F. Forcing Mr. Nguyen Huu N to pay a compensation of VND 100,000,000 to the company F. Suspending the company F's petition to sue Mr. N for a compensation of 36,600,000 VND paid for the telephone bill incurred by Mr. T. Regarding Mr. N's petition for the Company F’s return of USD 7500, because Mr. N filed a counterclaim petition after the Court convened a session to check the handover of and public access to evidence, his petition is not allowed to be tried in this action according to the provisions of Clause 2, Article 201 of the Civil Procedure Code in Viet nam. Mr. N is liable for the first instance court fee.

COURT’S JUDGEMENT

Based on the documents and evidence reviewed at the trial, and based on the results of the litigation at the trial, the Court judged that:

 [1] Regarding legal relation and jurisdiction: Since the plaintiff filed a lawsuit to request the defendant to pay the compensation amount agreed upon in the guarantee contract, the Court determines that this is the guarantee contract dispute; the defendant resides in Vu Thu district, Thai Binh province, so the case falls under the jurisdiction of the People's Court of Vu Thu district, Thai Binh province as prescribed in Clause 3 Article 26, Clause 1 Article 35 and Clause 1 Article 39 Civil Procedure Code.

 [2] Regarding the legal proceedings: Whereas the defendant and the person with relevant rights and obligations were duly summoned  by the Court, but were absent from the 2^nd trial session on none of sound grounds, the Trial Panel may apply Clause 3, Article 228 of the Civil Procedure Code, and conduct a trial of the case in the absence of the defendant and persons with related rights and obligations.

 [3] Regarding case contents:

 [3.1] Considering that the guarantee contract dated August 3, 2017 between Mr. Nguyen Huu N and Mr. Nguyen Huu T on one side and the Company F on the other side to guarantee his liability for compensation for any loss or damage arising from the runaway trainee during his internship period in Japan sets out the following terms and conditions:

 “1. The guarantor agrees to accept the guarantee for the obligor, Mr. Nguyen Huu T, and is responsible for compensation if, during the internship in Japan, Mr. Nguyen Huu T fled or left workplace where he is working as an intern without permission, to the extent that the company cannot contact the obligor for any further action. (The act of fleeing is considered as the act of the obligor’s not turning up; the obligor’s not being present or leaving his/her internship workplace in contravention of regulations, irrespective of any reasons, and is proved by the notice of the supervisory corporation (receiving agency or employer) or the notice of the competent organization or state authoritie regarding the obligor intern’s fleeing or leaving the internship workplace).” Guarantee sum: The guarantor shall accept the liability to pay the obligee an amount of VND 100,000,000 for any loss or damage that the obligor causes to the obligee.

As contractual terms and conditions are concluded on a voluntary basis and are not in breach of prohibitory regulations of the law, they must be protected by law.

 [3.2] On March 14, 2018, Mr. T left his assigned workplace without permission, unilaterally terminated the labor contract, violated the contract No. 103/HD DVPC dated July 31, 2017 signed with the Company F. His fleeing was informed in a report sent by the Nakamura Toso Receiving Agency, and the Report of the trainee’s leaving his place of residence without any tracing information dated March 14, 2018 of the supervisory corporation: Fuan jigyo Kyodo Kumiai, sent to the receiving authority: Nakamura Toso. Mr. T's fleeing was recorded and posted publicly on the website of the Overseas Worker Administration. The defendant Mr. Nguyen Huu N also admitted that Mr. T left the company where Company F recommended him to work. Because the obligor Mr. Nguyen Huu T committed an act of freeing and arbitrarily left his internship workplace, Mr. Nguyen Huu N must assume his guarantee liability. The fact that the company F issued a notice of unilateral termination of the contract and discharged its obligations to the fixed-term service contract for sending trainees to take the skill internship program in Japan on October 5, 2018 did not entail the termination of Mr. N's guarantee obligation under that guarantee contract. Therefore, it is mandatory to force Mr. Nguyen Huu N to abide by his guarantee obligations under the signed contract to pay the guarantee amount of VND 100,000,000 as prescribed in Articles 335, 339, 340 and 342 of the 2015 Civil Code; Clauses 8, 7, 55, 56 and 57 of the 2006 Law on Sending Vietnamese Workers Abroad under Contracts.

 [4] Mr. Nguyen Huu N supposed that as the company violated its obligations to ensure working and pay conditions for Mr. T in Japan, the Company must also be responsible to Mr. T as a worker. So, Mr. N requested Company F to pay him the amount of USD 7,500 that Mr. T had paid to the Company to be eligible to work in Japan. The court repeatedly asked the defendant to provide evidence to substantiate the contents of the defendant’s petition, but the defendant failed to do so. In the process of arbitrating the case, whereas Mr. T did not show up at the Court, had no detailed opinions, failed to provide documents and evidence to support his statement, the Court had no grounds for processing his petition. In addition, because Mr. N filed a counterclaim petition after the Court convened a session to check the handover of and public access to evidence, his petition was not allowed to be arbitrated in this action according to the provisions of Clause 2, Article 201 of the Civil Procedure Code. Whenever needed, Mr. N and Mr. T may sue Company F in another civil case.

 [5] Considering that, since the plaintiff’s withdrawal of the petition for compensation of VND 36,600,000 telephone bill that T incurred in order for the Company pay the Japan Post was at the plaintiff's discretion, this petition shall be suspended. Litigant may file the petition to re-initiate legal proceedings for this action to the court in accordance with law.

 [6] In terms of legal costs: Company F is not liable for the first instance court fee. Mr. N is liable for first instance court fee defined as VND 100,000,000 x 5% = VND 5,000,000.

In light of the aforesaid,

HEREBY DECIDES

Pursuant to Articles 147, 161, 228, 271 and 273 of the Civil Procedure Code; Pursuant to Articles 335, 339, 340, 342 of the 2015 Civil Code in Viet nam; Clause 8, Article 7, Article 54, 55, 56, 57 of the 2006 Law on Sending Vietnamese Workers Abroad under Contracts. Pursuant to Article 26 of the Resolution No. 326/2016/UBTVQH14 in Viet nam dated December 30, 2016 of the National Assembly’s Standing Committee;

 [1]. Accept the petition to sue International Human Resource Training and Development Co., Ltd. F; force Mr. Nguyen Huu N to pay a compensation to International Human Resource Training and Development Co., Ltd. F under the Guarantee Contract dated August 3, 2017 for liability to pay damages for the fleeing acts or impermissible leaving of the workplace of Mr. Nguyen Huu T with the amount of VND 100,000,000 (One hundred million dong).

From the effective date of the court judgment, if the winning party files a request for the court judgment execution until the judgment is completely executed, till the complete payment of the requested sum, the losing party shall have to pay monthly interest on the remaining amount in proportion to the residual period at the payment time at the rate specified in clause 1 of Article 468 in the Civil Code

 [2]. Suspend the petition to sue filed by International Human Resource Training and Development Co., Ltd. F to demand that Mr. Nguyen Huu N must compensate them the amount of VND 36,600,000 for telephone charges incurred by the trainee. Litigant may file the petition to re-initiate legal proceedings for this action to the court in accordance with law.

 [3]. In terms of legal cost

Mr. N is liable for the first instance civil court fee of VND 5,000,000.

Reimburse International Training and Development Company Limited F an amount of VND 3,415,000 (Three million four hundred and fifteen thousand dong) that the company advances according to the receipt No. 0002988 dated June 27, 2018 at Vu Thu district’s Sub-Department of Civil Judgment Execution, Thai Binh province.

[4]. In terms of the right to appeal: International Training and Development Co., Ltd. F is entitled to appeal against the court judgement within 15 days from the date of pronouncement, September 13, 2019.

Mr. Nguyen Huu N and Mr. Nguyen Huu T are entitled to appeal against the court judgement within 15 days of receipt or posting of the court judgement.

In cases where the court judgement is executed under the provisions of Article 2 of the Law on Civil Judgment Execution in Viet nam, the obligee and obligor to execution of the civil judgment may negotiate about how the judgment is executed, the right to request judgment execution, voluntary execution of the court judgement or shall be subject to law enforcement processes under Articles 6, 7, 7a and 9 of the Law on Civil Judgment Execution; the term of execution of the court judgement is subject to regulations laid down in Article 30 of the Law on Civil Judgement Execution.