Is a handwritten land use rights transfer contract valid in Vietnam?

Hello, Lawnet would like to respond as follows:

1. Is a handwritten land use rights transfer contract valid in Vietnam?

According to the provisions at point a, clause 3 of Article 167 of the Land Law 2013 of Vietnam, the certification and notarization of contracts and documents exercising the rights of land users are implemented as follows:

“Article 167. Right to exchange, transfer, lease, sublease, bequeath, donate, mortgage, contribute land use rights as capital

...

3. The certification and notarization of contracts and documents to exercise land use rights shall be carried out as follows:

a) Contracts for the transfer, donation, mortgage, capital contribution using land use rights, land use rights and assets attached to the land must be notarized or certified, except for the cases of real estate business specified at point b of this clause;”

Hence, contracts for transfer of land use rights and attached land-assets must be notarized or certified, except where one or more parties involved in the transaction are organizations operating in the real estate business.

Furthermore, clause 2 of Article 129 of the Civil Code 2015 regulates contracts that do not comply with formalities but are recognized by the court as valid. To be specific:

“Article 129. Invalid civil transactions due to non-compliance with formalities

Civil transactions violating effective condition provisions regarding formalities are invalid, except in the following cases:

1....

2. Civil transactions established in writing but violating mandatory provisions on notarization or certification, where one or more parties have fulfilled at least two-thirds of the transaction obligations, may be recognized as valid by a court upon request of one or more parties. Such parties are not required to complete the notarization or certification.”

Therefore, in cases where a contract violates mandatory notarization or certification requirements, but one or more parties have fulfilled at least 2/3 obligations under the contract, the court may recognize the contract's validity upon a party’s request.

Thus, a handwritten land use right transfer contract without notarization or certification still holds legal validity in situations such as:

+ The parties have conducted land handover and payment.

+ The buyer has paid at least 2/3 of the contract amount.

+ ...

2. The recognition of a handwritten land use right transfer contract in practice

In the first instance judgment no. 31/2018/DS-ST dated August 16, 2018 on land use right transfer contract disputes tried by the People's Court of Tan Tru district, the following content is stated:

“On April 9, 2012, Mrs. Le Thi X received the transfer of land use rights from Mr. Le Van N and Mrs. Lieu Thi Thu V in writing, but without notarization or certification by competent state authorities, at a transfer price of 750,000,000 VND.

Mr. Ng, Mrs. X paid the couple Mr. N, Mrs. V twice, specifically: the first time on April 9, 2012, with an amount of 330,000,000 VND and the second time on May 1, 2012, with an amount of 400,000,000 VND, totaling 730,000,000 VND. The remaining 20,000,000 VND will be handed over to the couple Mr. N, Mrs. V when Mr. Ng and Mrs. X receive the land use right certificate.

All the 730,000,000 VND belonged to Mrs. X, and Mr. Ng did not contribute any part of this amount.

After receiving the transfer, the couple Mr. N, Mrs. V handed over the house and land to Mr. Ng, Mrs. X for management and use. However, Mr. N, Mrs. V did not complete the land use right transfer procedures, although Mr. Ng, Mrs. X had contacted them multiple times. At the end of 2012, Mr. N, Mrs. V moved away without leaving an address and without notifying Mr. Ng and Mrs. X.

Now, Mrs. Le Thi X sues to request Mr. Le Van N and Mrs. Lieu Thi Thu V to continue executing the land use right transfer contract for parcel no. 607, with an area of 100.4m2, type of homestead land in rural areas, and parcel no. 151, with an area of 1,895m2, type of rice cultivation land, along with the house on the land to Mrs. Le Thi X.”

The court’s assessment:

Based on the “Sale agreement dated April 9, 2012” (Bl 69-70), it is confirmed that these two payments were genuine, with the signatures of Mr. N, Mrs. V, and a witness, Mr. Phan Mong D. In his declaration dated June 15, 2018, Mr. Phan Mong D testified to witnessing the land transfer between Mr. N, Mrs. V with Mrs. X and Mr. Ng. From these analyses, the trial panel has grounds to determine that Mrs. X paid Mr. N and Mrs. V 730,000,000 VND of the agreed transfer amount of 750,000,000 VND.

The contract was only written by hand in 2012 and not notarized or certified as required, violating formalities but not violating content since these parcels were already allocated to Mr. Le Van N. During the period Mr. N, Mrs. V's family managed and used the land, they raised no objections.

Thus, Mr. Le Van N and Mrs. Lieu Thi Thu V are mandated to continue executing the land use right transfer contract, and Mrs. Le Thi X must pay Mr. Le Van N and Mrs. Lieu Thi Thu V the remaining amount of 20,000,000 VND (twenty million dong).

From the above case, it is evident that the land use right transfer contract between Mrs. X and the couple Mr. N, Mrs. V, written by hand and not notarized or certified, was still recognized as valid by the People's Court of Tan Tru district because:

Mrs. X paid Mr. N and Mrs. V 730,000,000 VND of the agreed transfer amount of 750,000,000 VND, fulfilling over 2/3 of the contract obligations.

During the period Mrs. X managed and used the transferred parcels, Mr. N, Mrs. V did not raise objections or obstruct.

The handwritten land use right transfer contract violates formalities. However, since the parcels were allocated to Mrs. X's family, the contract does not violate its content.

Thus, in the case of your friend, the contract is still legally recognized if they have fulfilled 2/3 of the contract obligations.

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