Hanoi-Vietnam: Precedent No. 07/2016/AL

Precedent No. 07/2016/AL

Adopted by the Judicial Council of the Supreme People's Court of Vietnam on October 17, 2016, and published according to Decision No. 698/QD-CA dated October 17, 2016, by the Chief Justice of the Supreme People's Court.

Source of Precedent:

Cassation Decision No. 126/2013/DS-GDT dated September 23, 2013, by the Judicial Council of the Supreme People's Court of Vietnam regarding a civil case "Disputing Ownership and Use of a House" in Hanoi City between the plaintiffs Mr. Nguyen Dinh Song, Mrs. Nguyen Thi Hong, Mrs. Nguyen Thi Huong and the defendants Mr. Do Trong Thanh, Mrs. Do Thi Nguyet, Mr. Vuong Chi Tuong, Mr. Vuong Chi Thang, Mrs. Vuong Bich Van, Mrs. Vuong Bich Hop; related parties include Mrs. Nguyen Thi Lan, Mrs. Nguyen Thi Hay, Mrs. To Thi Lam, Mr. Nguyen Dinh Uan, Mrs. Nguyen Thi Hop, Mr. Nguyen Dinh Hoa, Mrs. Nguyen Thi Minh Nguyet, Mrs. Tran Thi Bich, Mr. Vu Dinh Hau.

Position of the Precedent Content:

Paragraph 4 of the "Considering" section of the Cassation Decision mentioned above.

Summary of the Precedent:

- Precedent Situation:

A house purchase agreement was created in writing before July 1, 1991, signed by the seller, clearly stating that the seller had received full payment. The buyer, although not signing the agreement, kept the agreement and managed and used the house stably for a long time without the seller disputing to claim the house payment.

- Legal solution:

In this case, the agreement holds valid to determine that the buyer had fully paid the seller and the buyer’s will was to agree with the house purchase agreement. Hence, the house purchase agreement is recognized.

Legal provisions related to the Precedent:

- Articles 81, 82, 83 Civil Procedure Code 2004 (corresponding to Articles 93, 94, 95 Civil Procedure Code 2015);

- Resolution No. 58/1998/NQ-UBTVQH10 dated August 20, 1998, of the Standing Committee of the National Assembly on civil transactions regarding residential houses established before July 1, 1991.

Keywords of the Precedent:

"House Sale Agreement"; "One Party Not Signing the Agreement"; "Evidence Determination."

CASE CONTENT

In the petition dated March 6, 2006, and during the resolution process of the case, the plaintiff Mr. Nguyen Dinh Song presents: His father, Mr. Nguyen Dinh Chien (died in 1998), and his mother, Mrs. Nguyen Thi Mo (died in 2005), had four children including him, Mrs. Nguyen Thi Hong, Mrs. Nguyen Thi Huong, and Mrs. Nguyen Thi Lan. Previously, his family lived at 2, Hang Bun, while his uncle, Mr. Nguyen Dinh Nhuan, lived at No. 10 Hang Bun. When evacuated and returned, his uncle's house was taken by the State and given to others to use. Hence, his father gave the house at 2, Hang Bun to Mr. Nhuan, and his family rented a house, where Mr. Do Trong Thanh signed a contract with his father to rent the second floor of the house at 19, Thuoc Bac on February 1, 1972. house at 19, Thuoc Bac was owned by five siblings of Mr. Thanh: Mr. Do Trong Thanh, Mrs. Do Thi Nga, Mrs. Do Song Toan, Mrs. Do Thi Nguyet, and Mr. Do Trong Cao. Since Mr. Cao needed money for treatment, he sold a room of 38m2 on the second floor of the house at 19, Thuoc Bac to his family. The contract signed by Mr. Cao did not specify the date, the selling price was 6550 dong, and Mr. Cao received the full amount. When Mr. Cao sold the 38m2 room, he handed over the title deed of the house at 19, Thuoc Bac, clearly stating Mr. Cao owned 8/12 of the house, while Mr. Thanh, Mrs. Nga, Mrs. Nguyet, Mrs. Toan each owned 4/12 of the house. The first floor of the house at 19, Thuoc Bac had been sold to Mr. Vu Dinh Tiep and Mrs. Tran Thi Bich by Mr. Thanh and his siblings. Mr. Cao fixed a kitchen room of 7m2 on the second floor to live in. After Mr. Cao died on November 5, 1972, Mr. Thanh and his siblings sold the remaining room of 7m2 on the second floor of the house at 19, Thuoc Bac to his family for 3000 dong. They formalized the sale with a contract on the day Mr. Cao died, November 5, 1972. Mr. Thanh and his siblings signed and stated they had received the full payment. Mr. Thanh handed over a power of attorney written by Mr. Cao on September 9, 1972, stating Mr. Cao was the owner of the house at 19, Thuoc Bac and authorized Mr. Thanh to sell the auxiliary room of the house at 19, Thuoc Bac on his behalf due to illness. The purchase documents of the two rooms on the second floor of house at 19, Thuoc Bac were kept by his family, so his parents could sign them anytime. Mr. Thanh argued that his parents did not sign the purchase documents and thus had not paid was incorrect.

Mr. Nhuan passed away in 2000. His wife, Mrs. To Thi Lam, and their children, Mr. Nguyen Dinh Uan, Mr. Nguyen Dinh Hoa, Mrs. Nguyen Dinh Hop, Mrs. Nguyen Thi Minh Nguyet, confirmed that Mr. Chien purchased the second-floor room from Mr. Cao and not Mr. Nhuan, making Mr. Nhuan only a nominal owner.

Mr. Thanh's family (residing at the house at 17, Thuoc Bac) consistently created difficulties for his family. Mr. Thanh occupied the roof of the second floor of the house at 19, Thuoc Bac, leading to his father discussing with Mr. Thanh not to use the roof but was ignored. Consequently, both parties formalized an agreement on December 20, 1987, allowing Mr. Thanh to use the roof mutually, but tensions continued to rise. His family then applied for the ownership transfer of the second floor of the house at 19, Thuoc Bac, but Mr. Thanh obstructed. Hence, he demanded the Court recognize the sale agreement of the second floor of the house at 19, Thuoc Bac.

Additionally, he sought several compensations:

- Since the first floor of the house at 19, Thuoc Bac was sold to Mr. Tiep’s family and the second floor to his own family, Mr. Thanh had no rights over the house at 19, Thuoc Bac. Therefore, Mr. Thanh could not use the roof of the second floor or the auxiliary area of the house at 19, Thuoc Bac.

His family purchased the second floor with an oral agreement to access via the pathway through the first floor of the house at 17, Thuoc Bac (owned by Mr. Thanh). Hence, he requested Mr. Thanh not to store goods in the walkway leading from Hang Ca Street through houses No. 17 and 19 Thuoc Bac to the second floor of the house at 19, Thuoc Bac.

- Compensation for occupying the roof and using the walkway to store goods since 1987 to date amounting to 540,000,000 VND (2,500,000 VND/month x 18 years).

- Compensation for injuries to him and his wife caused by Mr. Thanh’s son, amounting to 5,000,000 VND per person.

- Emotional distress compensation due to disputes causing instability to his family’s life, amounting to 800,000,000 VND.

- Mr. Thanh must cover the costs for repairing the roof damaged by Mr. Thanh’s belongings, estimated at 120,000,000 VND.

- Compensation for loss of employment due to prolonged litigation caused by Mr. Thanh, totaling 108,000,000 VND (12,000,000 VND/year x 9 years).

The defendant, Mr. Do Trong Thanh, presented: the house at 19, Thuoc Bac is recorded in land title No. 1577, Dong Xuan Block, with an area of 69m2 under the ownership of Mr. Do Huy Ngoc and Mrs. Le Thi Huu (his parents). On April 21, 1959, the title was transferred to their children, specifically: Mr. Cao owned 8/12, while Mrs. Nga, Mrs. Nguyet, Mrs. Toan, and himself jointly owned 4/12 of the house. In 1971, they allowed Mr. Chien and Mrs. Mo (Mr. Song's parents) to rent the second floor of the house at 19, Thuoc Bac. Later in 1971, Mr. Cao sold a room of 38m2 in the house at 19, Thuoc Bac to Mr. Nguyen Dinh Nhuan, but Mr. Chien signed in place of Mr. Nhuan on the sales document worth 6550 dong, undated.

On September 9, 1972, Mr. Cao authorized Mr. Thanh to sell an additional room of 7.8m2 on the second floor of the house at 19, Thuoc Bac. Mr. Cao died on November 5, 1972. Based on the authorization, Mr. Thanh drafted a sales document for the 7m2 room but was also asked by Mr. Chien to include the 38m2 room already bought from Mr. Cao; hence, he wrote a deed to sell the entire second floor and had his siblings sign it. However, Mr. Nhuan present then prevented Mr. Chien and his wife from signing the deed, so they never signed. Mr. Thanh did not agree with Mr. Song's requests, as Mr. Song was merely staying in Mr. Nhuan's place.

Mr. Thanh further stated: Mr. Cao sold the room in around 1971. Mr. Cao's authorization was invalid since the house was a shared asset. They held no official documents for house at 19, Thuoc Bac due to the dispute; the house at 17, Thuoc Bac was officially documented as inherited property by a 1992 will. Mr. Thanh kept the original sale document by Mr. Cao to Mr. Nhuan, while other documents were not retained.

He disagreed with Mr. Song’s claim for ownership of the second floor of house at 19, Thuoc Bac, asserting that Mr. Song's parents never signed or paid for the purchase document. Hence, the sale agreement lacked legality, and Mr. Song lacked the right to claim the roof of the second floor. The pathway between houses No. 17 and 19 Thuoc Bac was only temporarily used by Mr. Song. The auxiliary area of house at 19, Thuoc Bac had not been sold and was still used by them. Therefore, Mr. Song’s compensation claims for income loss were Reject as he was the initiator of the disputes. Both parties incurred injuries, which the police did not address, thus rejecting damage compensation requests.

On April 7, 2009, Mr. Thanh countersued, demanding Mr. Song’s family use the exit that directly accessed the public pathway from the house at 19, Thuoc Bac, clarifying that the house at 17, Thuoc Bac remained his property while the first floor of the house at 19, Thuoc Bac sold to Mr. Tiep’s family under restricted occupancy excluding the walkway.

On September 23, 2009, Mr. Thanh withdrew his counterclaim regarding the walkway.

- Mrs. Do Thi Nguyet and the children of Mrs. Do Thi Nga, including Mr. Vuong Chi Tuong, Mr. Vuong Chi Thang, Mrs. Vuong Bich Van, Mrs. Vuong Bich Hop, presented: Although Mr. Cao wrote to sell the 38m2 room, the house was jointly owned and hence void of sole authority. Mrs. Nga and Mrs. Nguyet signed for the 7m2 room sale but claimed the buyer had not yet paid, thus requesting the return of the house.

Persons with related rights and obligations:

- Mrs. To Thi Lam presented: Her husband, Mr. Nguyen Dinh Nhuan, died in 2000. Previously, they lived at No. 10 Hang Bun Street and together with Mr. Chien's family. In 1970, Mr. Chien's family moved into the house at 19, Thuoc Bac. She was unaware of the house purchase details but recalled Mr. Nhuan informing her in 1972 that Mr. Chien had purchased the house under Mr. Nhuan’s name. The house at 19, Thuoc Bac was bought and paid for by Mr. Chien's family alone.

- Her children, Mr. Nguyen Dinh Uan, Mr. Nguyen Dinh Hoa, Mrs. Nguyen Dinh Hop, and Mrs. Nguyen Thi Minh Nguyet concurred with her statements.

- Mrs. Tran Thi Bich and Mr. Vu Dinh Hau presented: They occupied the first floor of the house at 19, Thuoc Bac. Mr. Thanh had no rights over requiring the walkway for Mr. Song’s family use. They had no further comments after Mr. Thanh withdrew his countercomplaint.

In the First-instance Judgment No. 78/DSST dated November 21, 2007, by the Hanoi People’s Court:

- Reject Mr. Nguyen Dinh Song’s claim.

On November 21, 2007, Mr. Nguyen Dinh Song appealed.

In the Appellate Judgment No. 121/2008/DSPT dated June 30, 2008, by the Appellate Court of the Supreme People’s Court in Hanoi:

- Overturned the first-instance judgment, remanded for first-instance trial.

In the First-instance Judgment No. 52/2009/DSST dated September 29, 2009, by the Hanoi People’s Court:

1. Reject the plaintiff’s claim for recognizing the sale agreement of the entire second floor of the house at 19, Thuoc Bac.

2. Accept Mr. Song’s request to make Mr. Thanh remove all belongings from the roof of the second floor of the house at 19, Thuoc Bac to the house at 17, Thuoc Bac.

Both families would use the roof mutually as agreed on December 20, 1987.

3. Reject Mr. Song’s request to prevent Mr. Thanh from using the auxiliary area.

4. Determine the walkway from Hang Ca Street to lie within the land areas of houses No. 17 and 19 Thuoc Bac, free of obstruction for passage.

5. Reject all damage compensation claims against Mr. Thanh.

6. Reject other requests from the parties.

7. Dismiss Mr. Thanh’s counterclaim.

On October 1, 2009, Mr. Nguyen Dinh Song appealed against the first-instance court's decision.

On October 12, 2009, Mr. Do Trong Thanh appealed against the first-instance court’s decision regarding the walkway, requesting its temporary designation.

In the Appellate Judgment No. 86/2010/DS-PT dated May 18, 2010, by the Appellate Court of the Supreme People’s Court in Hanoi:

- Affirmed the first-instance judgment regarding the house sale and other claims; annulled part of the first-instance judgment, remanded for first-instance trial on the walkway through the house at 17, Thuoc Bac.

On July 20, 2010, Mr. Nguyen Dinh Song requested a supervisory review, demanding recognition of the second-floor sale agreement for the house at 19, Thuoc Bac.

In Decision No. 148/2013/KN-DS dated April 11, 2013, the Chief Justice of the Supreme People’s Court appealed the Appellate Judgment No. 86/2010/DS-PT dated May 18, 2010, by the Appellate Court of the Supreme People’s Court in Hanoi; recommended the Judicial Council of the Supreme People’s Court to void the said Appellate Judgment and First-instance Judgment No. 52/2009/DS-ST dated September 29, 2009, by the Hanoi People’s Court; and remanded the case for first-instance trial according to the law.

At the supervisory trial, the representative of the Supreme People’s Procuracy proposed the Judicial Council of the Supreme People’s Court accept the Chief Justice’s appeal, but void the Appellate Judgment No. 86/2010/DS-PT dated May 18, 2010, by the Appellate Court of the Supreme People’s Court in Hanoi and remand the appellate level trial. The Council of Judges of the Supreme People's Court concludes:

According to the statements of the plaintiff, and defendant, and documents in the case file, the house at No. 19 Thuoc Bac Street, Hang Bo Ward, Hoan Kiem District, Hanoi, owned by Mr. Do Huy Ngoc and Mrs. Le Thi Huu, was inherited by their children. Mr. Do Trong Cao (deceased in 1972, without a spouse or children) was entitled to 8/12, while Mrs. Do Thi Nga, Mrs. Do Thi Nguyet, Mrs. Do Thi Song Toan (deceased in 1963, without a spouse or children), and Mr. Do Trong Thanh shared 4/12. On July 1, 1971, Mr. Thanh signed a contract to rent out a room on the second floor of the house at 19, Thuoc Bac Street, with an area of 39.36m², to the family of Mr. Nguyen Dinh Nhuan (uncle of Mr. Nguyen Dinh Song, deceased in 2000) and Mr. Nguyen Dinh Chien (father of Mr. Song, deceased in 1998) for medical treatment expenses for Mr. Cao, for which he received an advance of 2000 dong.

In the "Deed of Absolute Sale of a Room" (undated but acknowledged by Mr. Thanh as written around 1971), Mr. Cao sold to Mr. Nhuan a room on the second floor of the house at 19, Thuoc Bac Street (area not stated) for 6550 dong. The seller had received full payment, noted as Mr. Chien representing and signing on behalf of Mr. Nhuan. Mr. Thanh claimed that the sold room was the rented room mentioned above and sold to Mr. Nhuan, not to Mr. Chien. However, Mrs. To Thi Lam and Mr. Nguyen Dinh Uan, Mr. Nguyen Dinh Hoa, Mr. Nguyen Quynh Hop, and Mrs. Nguyen Thi Minh Nguyet (wife and children of Mr. Nhuan) all confirmed that Mr. Chien directly transacted and paid the money. Mr. Nhuan only nominally represented Mr. Chien on the house purchase contract made by Mr. Cao. Thus, there is a basis to determine that Mr. Chien was the buyer of this room.

On September 9, 1972, Mr. Cao wrote an authorization for Mr. Thanh to sell the auxiliary room Mr. Cao was occupying. On November 5, 1972, Mr. Cao died intestate. On the same day, November 5, 1972, Mr. Thanh, Mrs. Nga, and Mrs. Nguyet signed the "Deed of Absolute Sale of the Second Floor of house at 19, Thuoc Bac Street," selling to Mr. Chien and his wife the main room of 38.07m² and the auxiliary room of 7.095m², totaling 45.165m², for 3000 dongs. The seller had received full payment, and the buyer had taken over and was using the second floor. The deed was signed by the sellers (Mr. Thanh, Mrs. Nga, and Mrs. Nguyet), and the buyers (notably mentioned as Mr. Chien and Mrs. Mo) did not sign.

When the dispute arose, Mr. Song presented the two above-mentioned sale deeds and the authorization from Mr. Cao to Mr. Thanh to sell the house. In reality, Mr. Chien's family had managed both rooms on the second floor of the house at 19, Thuoc Bac Street without any rental or purchase price disputes from Mr. Thanh's family living next door at No. 17 Thuoc Bac Street since 1972. The content of the "Deed of Absolute Sale of the Second Floor of the house at 19, Thuoc Bac Street" clearly indicated that the seller had received full payment, and there was no separate payment receipt agreed upon by both parties, serving as proof that the buyer had paid. The buyer had not signed the purchase document, but the buyer kept the document, thus confirming the seller's obligation of having received payment. The first-instance and appellate courts' conclusion that the buyer had not signed the purchase document and could not prove payment to dismiss the plaintiff's request to recognize the house sale contract was unjust to the plaintiff's rights.

The house sale transactions among Mr. Thanh and his siblings with Mr. Chien and Mrs. Mo predating July 1, 1991, necessitate referring to Resolution 58/1998/NQ-UBTVQH10 dated August 20, 1998, of the Standing Committee of the National Assembly for resolving this case. Mrs. Nguyen Thi Lan (daughter of Mr. Chien and Mrs. Mo), who participated in the proceedings as an interested party due to inheriting the estate of Mr. Chien and Mrs. Mo, did not partake in this transaction. Mrs. Lan had settled in the Czech Republic since 1997, and this sale was not a pre-July 1, 1991, house transaction involving an overseas Vietnamese before July 1, 1991. Thus, the first-instance and appellate courts' reliance on Resolution 1037/2006/NQ-UBTVQH11 dated July 27, 2006, concerning civil transactions of houses with overseas Vietnamese before July 1, 1991, to resolve the case was incorrect.

For these reasons, pursuant to Clause 3, Article 291; Clause 3, Article 297; and Clause 2, Article 299 of the Civil Procedure Code (as amended and supplemented by Law No. 65/2011/QH12 dated March 29, 2011, by the National Assembly),

DECISION:

To annul the entire Appellate Judgment No. 86/2010/DS-PT dated May 18, 2010, by the Appellate Court of the Supreme People's Court in Hanoi regarding the "Dispute over House Ownership and Use" between the plaintiff(s) Mr. Nguyen Dinh Song, Mrs. Nguyen Thi Hong, Mrs. Nguyen Thi Huong and the defendant(s) Mr. Do Trong Thanh, Mrs. Do Thi Nguyet, Mr. Vuong Chi Tuong, Mr. Vuong Chi Thang, Ms. Vuong Bich Van, Ms. Vuong Bich Hop; involving 9 related parties with interests and obligations.

The case file is transferred to the Appellate Court of the Supreme People's Court in Hanoi for retrial according to the law.

CONTENT OF PRECEDENT

"In the dispute, Mr. Song presented the two above-mentioned sale deeds and Mr. Cao's authorization for Mr. Thanh to sell the house. Indeed, Mr. Chien's family had managed both rooms on the second floor of the house at 19, Thuoc Bac Street without any rental or purchase price disputes since 1972, while Mr. Thanh's family lived next door at No. 17 Thuoc Bac Street. The content of the "Deed of Absolute Sale of the Second Floor of the house at 19, Thuoc Bac Street" clearly indicated the seller had received the payment. There was no separate payment receipt agreement, serving as confirmation that the buyer had paid. Although the buyer had not signed the purchase document, the buyer kept it, confirming the seller's obligation of receiving payment. The first-instance and appellate court's dismissal of the plaintiff's house purchase contract recognition request, based on the buyer's unsigned purchase document and unproven payment, was unjust to the plaintiff's rights."

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