The contract of donation of real estate is void due to fraud in Vietnam

However, at present, there are still cases of taking advantage of the ignorance of others to sign a contract to donate property to gain benefits. So in these cases, is the donation contract considered void due to fraud or not?

Specifically, the appellate civil judgment No. 11/2021/DS-PT dated March 25, 2021 on the request to declare a notarized document invalid has the following summary:

“Mrs. Le Thi M has created a land plot with an area of ​​164.2m2 in area 6 (now group 11) town P, Huong Thuy Town, Thua Thien Hue province. This land area has been granted the certificate of land use right by the People's Committee of Huong Thuy town No. V218091 dated June 14, 2004 in the name of Le Thi M. On this land parcel, Ms. Le Thi M built a house for life. In 2009, her children and grandchildren needed capital to do business, so Ms. Le Thi M lent Mr. Le Thanh S and Mr. Le Thanh T a certificate of land use right to borrow from the Bank. Taking advantage of Ms. Le Thi M who is illiterate, Mr. Le Thanh S and Le Thanh T deceived Ms. Le Thi M to sign a contract to donate the entire house and land to Mr. Le Thanh S and Mr. Le Thanh T. In 2010 Mr. Le Thanh S died. In 2013, Ms. Le Thi M reclaimed the land use right certificate, but Mr. Le Thanh T,

Ms. Le Thi M filed a lawsuit to request the Court to declare the nullity of the contract of donation of land use rights notarized by the Notary Office No. 1 of Thua Thien Hue province on May 28, 2009 for the land plot No. 196; Contract for house donation certified by the Justice Department of Huong Thuy district (now Huong Thuy town) on June 4, 2009 for the house attached to the land plot No. 196 between Mrs. M (the donor) and Mr. Le Thanh S and Mr. Le Thanh T (the donor) because she did not have the purpose of donating the house, but only lent it to the bank as a mortgage for business capital.”

The People's Court of Thua Thien Hue province has applied Articles 122, 127, and 128 of the 2005 Civil Code declaring the contract for a donation of land use rights for land plot No. 196 and the contract for gifting the house attached to the land plot. number 196 invalid. Forcing Mr. Le Thanh T to return to Ms. Le Thi M 01 land use right certificate No. V218091 named after Ms. M.

In the above case, the fact that Ms. M could not read or write since she was a child was confirmed by many witnesses who are relatives and neighbors of hers. Therefore, there are grounds to prove that Mrs. M cannot read or write. According to the provisions of Clause 1, Article 8 of Decree No. 75/2000/ND-CP :

“Article 8. Witnesses

1. Where the law provides that the notarization or authentication must have the witnesses or where the law does not require the witnesses but the notarization or authentication requesters are unable to read, hear, sign or to press their fingerprints, there must be witnesses."

And in Clause 1, Article 9 of the Law on Notary 2006:

“ Article 9. Witnesses

1. In cases where the law stipulates that notarization must have witnesses, or where it is not required by law that notarization must have witnesses, but the notarization requester can not read or hear or sign and cannot sign it. If you can only get points, there must be witnesses .”

Therefore, the notarization of the contract of gifting of property that Ms. B cannot read or write requires a witness.

At the time of signing the contract for the donation of land use rights, notarized by the Notary Office No. 1 of Thua Thien Hue province on May 28, 2009 (Notary number 692, book No. 01/TP/CC-SCC/BS) and the Contract No. a contract for housing donation certified by the Justice Department of Huong Thuy district (now Huong Thuy town) on June 4, 2009 (certificate number 51, book number 01/T2/CC-SCT/HDGD) between the donor Ms. Le Thi M with the donor as Mr. Le Thanh S and Mr. Le Thanh T without witnesses violates the provisions of Clause 1, Article 9 of the Law on Notarization and Clause 1, Article 8 of Decree No. 75/2000/ Decree-CP dated December 8, 2000, of the Government on notarization and authentication upon authentication.

Besides, at the time of certifying the above-mentioned house donation contract, the house has not yet been granted a house ownership certificate, so the house donation violates Clause 1, Article 91 of the Law on Housing 2005 of Vietnam about conditions of houses participating in the transaction:

“ Article 91. Conditions of houses participating in transactions

1. In the transactions of sale and purchase, donation, exchange, inheritance, mortgage, lending, permitted temporary stay by others, authorized management of houses, the houses must satisfy the following conditions:

a/ Having house ownership right certificates as provided for by law;

b/ Being free from disputes over ownership rights..."

In the case of Ms. Le Thi M, due to the two main reasons mentioned above, the contract of donation of real estate between her and Mr. Le Thanh S and Mr. Le Thanh T was declared invalid by the court.

In addition, from the author's point of view, the fact that Mr. Le Thanh S and Mr. Le Thanh T took advantage of Ms. M's inability to read and write to deceive her into signing a contract for gifting real estate is considered a case of invalid civil transactions due to deception according to the provisions of Article 132 of the 2005 Civil Code (now Article 127 of the 2015 Civil Code ). This is also a basis for the Court to declare the above-mentioned land donation contract invalid.

The donation of real estate or property among family members or between acquaintances and friends is now commonplace to show affection in the family or to help each other in difficult times. However, this job has morphed and is used to profit from his own relatives. Therefore, it is necessary to clearly understand the provisions of the law on donation contracts, the rights and obligations of the parties to avoid being taken advantage of and deceived when entering into this type of contract.

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