Content of Legal Precedent No. 02/2016/AL on "Claim for the Return of Property Dispute"

According to Decision 220/QD-CA of 2016, Judicial Precedent No. 01/2016/AL regarding "Dispute over Claiming Back Property" contains the following specific content:

Source of the Precedent:

Supervisory Decision No. 27/2010/DS-GDT dated July 08, 2010, by the Council of Judges of the Supreme People's Court regarding the case "Dispute over Claiming Back Property" in Soc Trang Province between the plaintiff, Mrs. Nguyen Thi Thanh, and the defendant, Mr. Nguyen Van Tam,; the involved person related to interests and obligations is Mrs. Nguyen Thi Yem.

Overview of the Content of the Precedent:

In cases where Vietnamese expatriates have spent money to receive the transfer of land use rights and have trusted a domestic resident to hold the land use rights on their behalf, when resolving disputes, the court must consider and calculate the effort of maintaining, preserving, and enhancing the value of the land use rights by the person holding the title. If the precise effort by the person cannot be exactly determined, it is necessary to determine that the one who actually paid for the transfer of land use rights and the person holding the title are entitled to the increased value equally compared to the original money spent for the land use transfer.

Legal Provisions Related to the Precedent:

Article 137 and Article 235 of the Civil Code of 2005.

Keywords of the Precedent:

“Invalid Civil Transactions”; “Claiming Back Property”; “Basis for Establishing Ownership”; “Establishing Ownership over Profits”; “Vietnamese Expatriates”.

CASE CONTENT

In the lawsuit filed on January 24, 2005, the declaration on February 07, 2005, and during the process of resolving the case, plaintiff Mrs. Nguyen Thi Thanh presented:

Mrs. Thanh, a Vietnamese expatriate in the Netherlands, visited her relatives in Vietnam with the intention of transferring land use rights. On August 10, 1993, she received the transfer of 7,595.7m² of rice land at Ward 7, Soc Trang district-level town from Mr. Heng Tinh and Mrs. Ly Thi Sa Quenh for 21.99 taels of gold. She was the one directly negotiating, agreeing on the transfer, and paying money, gold to Mr. Heng Tinh and his wife. Mrs. Thanh’s purpose was to transfer the land to her younger brother, Mr. Nguyen Van Tam, and Mrs. Nguyen Thi Chinh Em, to cultivate for their parents. Since she was a Vietnamese expatriate, she allowed Mr. Tam to be the title holder in the transfer documents. Additionally, Mrs. Thanh presented a “Land Transfer Document” dated August 10, 1993, confirmed by An Hiep Commune People's Committee. After receiving the transfer, she left the land for Mr. Tam and his wife to cultivate, but in 2004, without her consent, Mr. Tam transferred the entire 7,595.7m² of land to Minh Chau Limited Liability Company with the land use value of VND 1,260,000,000. Therefore, she requested Mr. Tam to return the amount obtained from the land transfer to her.

Defendant Mr. Nguyen Van Tam presented:

The 7,595.7m² of land disputed by Mrs. Thanh was purchased by Mr. Tam and his wife from Mr. Heng Tinh’s couple, for which he is the titleholder in the "Land Transfer Document" dated August 10, 1993. This transfer document did not have local government verification. Subsequently, he and Heng Tinh’s couple signed a contract and an application for transferring land use rights on August 11, 1993, which were verified by An Hiep Commune People's Committee and My Tu District People's Committee. After the transfer, he registered and was granted a land use certificate on May 28, 1994. Therefore, in 2004, he transferred the entire land to Minh Chau Limited Liability Company for VND 1,260,000,000. He asserted that the “Land Transfer Document” dated August 10, 1993, presented by Mrs. Thanh, was false as per Forensic Assessment Conclusion No. 2784/C21 (P7) dated October 25, 2005, which stated that the signature on the transfer document presented by Mrs. Thanh was not his. Thus, he did not agree with Mrs. Thanh’s lawsuit claim.

Influenced party Mrs. Nguyen Thi Yem (Mr. Tam’s wife) stated:

In 1993, she and her husband transferred the land from Mr. Heng Tinh. During the transfer process, she did not participate, but she did give money and gold to Mr. Tam to pay for Mr. Heng Tinh’s couple, so she did not accept Mrs. Thanh’s claim.

Mr. Heng Tinh and Mrs. Ly Thi Sa Quenh (also known as Ly Thi Sa Venh), who transferred the land, affirmed that Mrs. Thanh directly negotiated, paid the gold and money to them, and had Mr. Tam listed as the titleholder in the transfer document dated August 10, 1993; the signatures in the provided transfer document were indeed theirs.

According to the Primary Civil Judgment No. 04/2006/DS-ST dated April 28, 2006, the Soc Trang People’s Court decided:

Partially accepting Mrs. Nguyen Thi Thanh’s claim for the transfer payment.

Requiring Mr. Nguyen Van Tam and Mrs. Nguyen Thi Yem to return VND 630,000,000 to Mrs. Nguyen Thi Thanh.

Additionally, the primary court also decided on the court fees, assessment costs, and declared the right to appeal for the parties under legal regulations.

On May 10, 2006, Mr. Nguyen Van Tam appealed, stating that Mrs. Thanh was not the land use rights holder he transferred to Minh Chau Limited Liability Company, but the primary court ruling him to pay VND 630,000,000 to Mrs. Thanh was incorrect.

On May 12, 2006, Mr. Nguyen Huu Phong (representing Mrs. Thanh) appealed, requesting the appellate court to adjudge and require Mr. Tam to return the total amount of VND 1,260,000,000 obtained from the land transfer to Mrs. Thanh.

According to the Appellate Civil Judgment No. 334/2006/DS-PT dated August 25, 2006, the Appellate Court of the Supreme People's Court in Ho Chi Minh City decided to: reject the appeal requests of both plaintiff and defendant and amend the primary judgment as follows:

Partially accepting Mrs. Nguyen Thi Thanh’s claim for the payment transfer of land use rights.

Requiring Mr. Nguyen Van Tam and Mrs. Nguyen Thi Yem to return VND 27,047,700, equivalent to 21.99 taels of 24k gold, to Mrs. Nguyen Thi Thanh.

Requiring the couple Mr. Nguyen Van Tam and Mrs. Nguyen Thi Yem to submit VND 1,232,266,860 to the state treasury.

Additionally, the appellate court also decided on the court fees.

After the appellate trial, Mr. Nguyen Van Tam filed a complaint against the said appellate civil judgment.

According to Decision No. 449/2009/KN-DS dated August 21, 2009, the Chief Justice of the Supreme People's Court appealed the Appellate Civil Judgment No. 334/2006/DS-PT dated August 25, 2006, of the Appellate Court of the Supreme People's Court in Ho Chi Minh City, requesting the Council of Judges of the Supreme People's Court to conduct a supervisory trial, annul the said appellate judgment and the Primary Civil Judgment No. 04/2006/DS-ST dated April 28, 2006, of the Soc Trang People’s Court; returning the case file to the Soc Trang People’s Court for re-examination according to the law, with comments:

“Mrs. Nguyen Thi Thanh sued to reclaim property against Mr. Nguyen Van Tam, asserting that since she was a Vietnamese expatriate, she had Mr. Tam (her brother) listed as the titleholder after transferring the land from Mr. Heng Tinh’s couple on her behalf, but Mr. Tam subsequently transferred her land to another party.

The primary and appellate courts accurately determined that Mr. Tam was merely the titleholder on behalf of Mrs. Thanh concerning the land transferred by Mr. Heng Tinh’s couple.

Since Mrs. Thanh is a Vietnamese expatriate, she cannot be granted the land but only the investment cost for the land transfer.

Regarding the difference in land value, at the time of the primary and appellate trials, under the Civil Code of 2005, there were no provisions for confiscating the excess value into the state treasury; thus, the difference ought to be shared by both Mrs. Thanh and Mr. Tam. The primary court’s ruling that Mr. Tam was not required to submit the excess value to the state treasury was accurate but not ordering Mr. Tam to return the initial investment to Mrs. Thanh was incorrect. The appellate court, without any legal basis, unjustly required Mr. Tam to remit the total excess value (VND 1,232,226,860) to the state treasury, which was not in conformity with the law.”

At the supervisory trial, the representative of the Supreme People’s Procuracy agreed with the appeal of the Chief Justice of the Supreme People's Court to annul the mentioned appellate judgment and the Primary Civil Judgment No. 04/2006/DS-ST dated April 28, 2006, of the Soc Trang People’s Court; return the case file to Soc Trang People’s Court for re-examination in accordance with the law.

Council of Judges of the Supreme People's Court's Consideration:

Mrs. Nguyen Thi Thanh filed a lawsuit requesting Mr. Nguyen Van Tam to return VND 1,260,000,000, arguing that she was the one who directly negotiated, paid for the land transfer of 7,595.7m² from Mr. Heng Tinh’s couple, but because she was a Vietnamese expatriate, she entrusted Mr. Tam (her brother) to be the titleholder, but without her approval, Mr. Tam transferred the entire land to Minh Chau Limited Liability Company to obtain VND 1,260,000,000.

Mr. Tam claimed that he was the one who negotiated the land transfer and paid the money to Mr. Heng Tinh, so he was listed as the titleholder in the land transfer documents. After the transfer, he directly managed and used the land, registered and was granted a land use certificate, and he transferred the land to Minh Chau Limited Liability Company with the permission of the authorities; thus, he did not accept Mrs. Thanh's request.

However, during the case resolution process, Mr. Tam and his wife had inconsistent statements about the amount of money and gold they paid Mr. Heng Tinh, and Mr. Tam could not prove the origin of the money and gold he claimed to have paid Mr. Tinh.

Meanwhile, Mr. Heng Tinh and Mrs. Quenh affirmed that they only dealt with and received gold from Mrs. Thanh, and the land transfer documents bearing Mr. Tam’s name was per Mrs. Thanh's request because she was a Vietnamese expatriate.

Based on the statements from Ms. Thai Thi Ba, Mr. Nguyen Phuoc Hoang, and Ms. Nguyen Thi Chinh Em (mother and siblings of Mrs. Thanh and Mr. Tam), Mrs. Thanh was the one conducting the transaction and paying for the land transfer with Mr. Heng Tinh’s couple, while Mr. Tam merely acted as the titleholder.

All the above evidence supports that the primary and appellate courts’ determination that Mrs. Thanh was the one spending 21.99 taels of gold for the land transfer while Mr. Tam merely held the title on her behalf, is justifiable. Since Mr. Tam transferred the land to Minh Chau Limited Liability Company and Mrs. Thanh only requested Mr. Tam to return the money from the transfer amounting to VND 1,260,000,000, the primary and appellate courts’ acceptance of jurisdiction was in accordance with the law.

Although Mrs. Thanh paid 21.99 taels of gold (equivalent to approximately VND 27,047,700) for the land transfer, the documents listed Mr. Tam as the titleholder, and after the transfer, he managed the land and later transferred it to another party. Therefore, Mr. Tam’s efforts in maintaining, preserving, and enhancing the land's value must be recognized, and the sum above (after deducting the initial amount equivalent to 21.99 taels of gold from Mrs. Thanh) is considered a common profit of Mrs. Thanh and Mr. Tam. It is appropriate to determine Mr. Tam’s contribution to allot him a proportionate part. If Mr. Tam’s contribution cannot be determined accurately, it should be considered equal between Mrs. Thanh and Mr. Tam.

The primary court recognized equal ownership of the amount for both parties but did not compensate Mrs. Thanh equivalent to 21.99 taels of gold, which was incorrect.

The appellate court only recognized Mrs. Thanh’s right to an amount equivalent to 21.99 taels of gold, while confiscating the excess profits to the state treasury, which was inconsistent with the Civil Code of 2005 and did not ensure the rights of the parties.

Furthermore, Mrs. Thanh sued Mr. Tam for returning VND 1,260,000,000 resulting from the land use value transfer of 7,595.7m² but did not contest the land use rights themselves, while Mr. Tam claimed that the amount was his. Hence, the parties were disputing ownership of the said amount. However, both the primary and appellate courts determined the legal relation as “claiming back property,” which was inaccurate.

For the reasons mentioned above, citing Clause 3 of Article 297 and Article 299 of the Civil Procedure Code;

DECISION

1- Annul the Appellate Civil Judgment No. 334/2006/DS-PT dated August 25, 2006, of the Appellate Court of the Supreme People's Court in Ho Chi Minh City and the Primary Civil Judgment No. 04/2006/DS-ST dated April 28, 2006, of the Soc Trang People’s Court on the dispute for reclaiming property between the plaintiff Mrs. Nguyen Thi Thanh and the defendant Mr. Nguyen Van Tam; the involved person related to interests and obligations, Mrs. Nguyen Thi Yem.

2- Return the case file to the Soc Trang People’s Court for re-examination according to the law.

PRECEDENT CONTENT

“Although Mrs. Thanh spent 21.99 taels of gold for the land transfer (equivalent to approximately VND 27,047,700), the documents listed Mr. Tam as the titleholder, and after the transfer, Mr. Tam managed the land and later transferred it to another party. Therefore, Mr. Tam’s efforts in maintaining, preserving, and enhancing the value of the land should be considered a common profit of Mrs. Thanh and Mr. Tam. If Mr. Tam’s contribution cannot be precisely determined, it should be regarded as equal participation between Mrs. Thanh and Mr. Tam.”

The above content pertains to Judicial Precedent No. 02/2016/AL on "Dispute over Claiming Back Property.”

Additionally, you can refer to a compiled list of 39 Judicial Precedents published and applied in Vietnam (Latest) here.

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