1. What is the transfer of civil obligations?
Article 274 of the Civil Code of 2015 of Vietnam stipulates: "Obligation is the work by which one or more subjects (hereinafter referred to as obligors) must transfer things, transfer rights, pay money or valuable papers, perform certain works or not perform certain works for the benefit of one or more other subjects (hereinafter referred to as obligors)".
Transfer of civil obligations means cases where the obligor fails to perform the obligations contracted by himself/herself but transfers them to another person (a third party). When the obligation is transferred, the transferee of the obligation is called a subrogator. The obligation relationship between the obligor and the obligee shall terminate and create a new obligation relationship between the obligor and the obligee and the obligor will have to perform the obligation with the obligee.
Thus, in essence, the transfer of civil obligations is the transfer of legal obligations from the subject to the recipient. The principal recipient of the obligation is a third person who replaces the previous obligor and becomes the obligor.
2. Conditions for transfer of civil obligations
Pursuant to Article 370 of the Civil Code 2015, the obligor may transfer a civil obligation to a subrogatee of the obligor with the consent of the obligee, except where the obligation is personal to the obligor or where the law provides that the obligation may not be transferred.
The law has the above provision because the transfer of civil obligations terminates the relationship between the original obligor and the obligee and gives rise to the obligation of the transferee to the obligee. This can bring a lot of risks to the obligee. If the obligor is unable to perform the obligation, it will have a direct adverse effect on the obligee.
In addition, it is necessary to make a further condition when transferring civil obligations that the transferred obligations must be legally effective obligations and not in cases where the law does not allow the transfer of obligations.
The law does not allow the transfer of civil obligations for obligations attached to relatives of the obligor or in specific cases, the law may not transfer such obligations as support obligations, obligations to perform work in the service contract or obligations agreed by the parties are not transferred.
For example, the Marriage and Family Law 2014 states that “The obligation to support cannot be replaced by another obligation and cannot be transferred to another person.”
3. Form of transfer of civil obligations
The Civil Code of 2015 does not provide for the form of transfer of obligations.
However, in order to avoid risks that may lead to risks related to the rights of the parties in the transfer of civil obligations, the transfer content and the manner and order of transfer should be fully disclosed in the written agreement between the parties.
For cases where the contents or objects of the transfer obligation are complex or subject to dispute or the State-managed or controlled assets, the transfer of the obligation must be made in writing, notarized or certified, registered or authorized.
4. Transfer of obligations with security interests
Article 371 of the Civil Code stipulates:
"Where a secured civil obligation is transferred, the security shall terminate, unless otherwise agreed."
Security is a special type of responsibility, which is a measure agreed by the parties or prescribed by law whereby the securing party uses its property or work to ensure the performance of civil obligations.
The object of security measures is usually the property owned by the obligor (the securing party), so when the obligation is transferred, the collateral is no longer owned by the securing party. Therefore, without the consent of the owner of the property, it will not be possible to dispose of the collateral when the obligor fails to perform the obligation
The transfer of obligations to the obligor will cause the original obligation relationship to terminate, the obligor becomes the obligor in the new obligation relationship with the obligor. On the other hand, the transfer of obligations must have the consent of the obligee, when the obligee chooses its own risk in accepting a third party to perform the obligation. Therefore, when the security interest is attached to the previous obligation relationship, the transfer to a third party of such security interest must be terminated if there is no other agreement.
5. Method of transfer of civil obligations
5.1. Transfer of civil obligations under the agreement
First of all, the civil law always respects the freedom of agreement of the parties, as long as it is not contrary to the provisions of law.
Therefore, there will be no transfer of obligations under the agreement if the obligor does not agree on this, he/she will not become an obligor to the obligee if he/she does not agree.
5.2. Transfer of obligations under the law
The law provides for the transfer of obligations without the agreement of the parties.
Specifically, when an individual dies, the individual's property obligations are not automatically terminated and the issue of determining a substitute is raised.
Article 614 of the Civil Code in 2015 stipulates: "From the time of opening the inheritance, the heirs have the property rights and obligations left by the deceased"
Thus, when the heirs receive the inheritance, they shall be responsible for performing property obligations within the scope of the estate left by the deceased. The transfer of obligations in this case does not require the consent of the persons concerned.