Principle Of Compensatory Damages Under The Civil Code

Order compensation for damages is one of the methods of protecting civil rights if the civil rights of an individual or an entity are violated, including right to life, right to safety of life, health and body, right to honour, dignity, prestige, right to asset, other rights and benefits. So, what do the principle of compensatory damages under the Civil Code rule for getting compensation for damages?

The first principle of compensatory damages under the Civil Code is that actual damage must be fully and promptly compensated. Unless otherwise provided by law, the parties may agree on the level of compensation; on the form of compensation, which may be money, in kind or for the performance of an act; lump sum payment or payment in instalments; and on the method of compensation.

The agreement of the parties about the amount and the method of compensation shall be respected. However, the principle of compensatory damages under the Civil Code must also be consistent with social ethics principles and in accordance with law.

The second principle of compensatory damages under the Civil Code is that the compensation payable by a person having caused a damage may be reduced if such damage was caused unintentionally and is too great in comparison to the financial capacity of such person. That is, in order to apply the principles of compensatory damages under the Civil Code, the infringing person may only get reduced the amount of compensation when it fulfils two conditions:

• The damage was caused unintentionally;
• The damage is too great in comparison to the financial capacity.

Thus, this regulation does not specify how much compensation will be reduced. As the case by case, depending on the conditions, circumstances and level of fault of the person causing the damage, the Court will base itself on the principle of compensatory damages under the Civil Code to decide to reduce the compensation.

The third principle of compensatory damages under the Civil Code, is that if the amount of compensation determined becomes unrealistic, the aggrieved person, or the person who has caused the damage, may request a court to change the amount of compensation.

The consideration of actual conditions such as economic situation, fluctuation in prices, increase in treatment costs… must be determined by the Court which will decide to change the compensation level based on the request of the parties.

The fourth principle of compensatory damages under the Civil Code, is that if the aggrieved party is partly at fault for causing the damage, that part of damage shall not be compensated.

Last but not least, the final principles of compensatory damages under the Civil Code is that the party having rights and interests infringed shall not be compensated if such damage incurs due to his/her failure to adopt necessary measures to prevent the damage.

The above is an overview of the principle of compensatory damages under the Civil Code. If you have trouble with legal issues regarding the principle of compensatory damages under the Civil Code, please contact us: Phuoc & Partners is a professional consulting firm established in Vietnam which currently has nearly 100 members working in three offices in Ho Chi Minh City, Hanoi and Danang. Phuoc & Partners. It is rated as one of the leading consulting firms specializing in business law in Vietnam that has leading practice areas in the legal market such as Labour and Employment, Taxation, Merger and acquisition, Litigation. We are confident in providing customers with optimal and effective service.