- What is the contract for loan of property dispute?
According to Article 463 of Civil Code (“CC”), contract for loan of property means an agreement between parties whereby a lender delivers property to a borrower; when the loan falls due, the borrower must repay the lender property of the same type in accordance with the correct quantity and quality and must pay interest if so agreed or so provided by law.
Accordingly, contract for loan of property dispute arises when there is a conflict between the parties in the loan contract due to failure to comply with the original agreement such as non-payment of debt, failure to pay interest to the lender or the lender changes the interest and principal compared to the original agreement. When a dispute arises, the parties resolve the dispute by negotiation and conciliation, but it does not bring the desired results, at this time, the lender and the borrower will consider the method of dispute resolution by way of the Court. Within the scope of today’s article, Phuoc & Partners will present the method of resolving contract for loan of property dispute in Court, what should the party’s pay attention to?
- Notes when disputing contract for loan of property dispute at Court
Firstly, regarding the limitation period for initiating legal action with respect to contract for loan of property dispute
According to Article 429 of CC 2015, the limitation period for initiating legal action to request a Court to resolve contract for loan of property dispute is 03 years from the date on which the person with the right to make the request knew or should have known that his/her lawful rights and interests were infringed.
Secondly, the jurisdiction to settle contract for loan of property dispute
According to Article 26.3 and Article 35.1.a, Article 39 of Civil Procedure Code (“CPC”) 2015, the jurisdiction to settle contract for loan of property dispute is People’s Courts of districts where the defendants reside.
Thirdly, interest rates in contract for loan of property
The parties should note that the interest rate in the contract cannot exceed 20%/year of the loan amount. In case the parties have an agreement on the payment of interest but do not specify the interest rate and there is a dispute over the interest rate, the interest rate shall be equal to 50% of the limit interest rate at the time of debt repayment according to Article 468.1 of the CC.
- Form of contract for loan of property
SOCIALIST REPUBLIC OF VIETNAM
Independence – Freedom – Happiness
CONTRACT FOR THE LOAN OF PROPERTY
No: … /2022/HDVTS
Pursuant to Civil Code No. 91/2015/QH13 dated 24 November 2015
Based on the demand and realistic ability of both parties in this contract.
Today,….date…. month… 2022, at….we includes:
Lender (hereinafter referred as Party A):
Name of an organization
Address of the office
Enterprise Code:
Legal representative
Position
Tel: …..Email: …
(In case the property lender or the property borrower is an individual, the following shall be recorded):
Full name
Date of birth …/ …/ …
ID number no ………………, issued on …/ …/ …, by: …
Registered place of permanent residence …
Address:
Tel: …/Email: …
Lender (hereinafter preferred as Party B)
Name of an organization
Address
Enterprise Code
Legal Representative
Position …
Tel …
Email: …
Both parties mutually agree to enter this service contract with following terms and conditions:
Article 1. Subject of the contract
Property lent
Type of property
Number of properties
Property quality
Article 2. Period
The property loan term under this contract is … months, from …/ …/…
Article 3. Interest
Interest calculation time, from …/ …/…
The interest rate is: … %/…
(The time and interest rate for property loan shall be negotiated by Party A and Party B and specified in the contract. The negotiated interest must not exceed 20% per year of the loan, unless otherwise provided by other relevant laws)
Article 4. Purpose of using loan property
Property lent is used for…
Article 5. Time limit, place, and method of delivery of loan property
The time limit for Party A to deliver the loan property to Party B is: … days, from …/ …/…
The place where Party A deliver the property loan to Party B is at: …
Method of delivery of loan property: Party A deliver loan property to Party B to receive once or … times and directly.
Article 6. Term, location, and method of returning loan property
The time limit for Party B to return the loan property to Party A is: … days, from …/ …/
The place where Party B return the loan property to Party A at: …
Method of returning loan property: Party B returns the loan property to Party A to receive it once or … times and directly.
Article 7. Ownership of loan property
Party B becomes the owner of the loan property, from the time it is delivered by Party A.
Article 8. Rights and obligations of the parties
- Rights and obligations of Party A
Deliver the property to Party B in full, with the right quality and quantity according to the time, place and method agreed upon in this contract.
Provide necessary information for Party B to know clearly about the condition, as well as defects of the loaned property (if any), when handing over the property to Party B.
Check the use of the loan property of Party B and have the right to reclaim the loan property before the due date if Party B has been reminded but still uses the property for the wrong purpose.
Other rights and obligations as prescribed by law (if any).
- Rights and obligations of Party B
Return the loan property to Party A in full of the right type, quality and quantity according to the time, place and method agreed in this contract.
Pay the loan property interest to Party A as agreed in this contract.
Other rights and obligations as prescribed by law (if any).
Article 9: Dispute settlement method
During the performance of the Agreement, if any problems arise that need to be resolved, Party A and Party B shall reach an agreement and agree to settle them in a timely and reasonable. In case Party A and Party B cannot reach an Agreement, one of the parties has the right to initiate a lawsuit at a competent Court as prescribed by law.
Article 10: Parties’ assurance
- Party A assure that:
– Information about the property stated in this Agreement is true.
– Property in the case of being sold as prescribed by law;
– At the time of entering into this Agreement: The property is not in dispute; The property is not distrained to secure judgment enforcement;
– The conclusion of this agreement is completely voluntary, not deceived, not forced;
– To properly and fully perform the agreements stated in this Agreement
- Party B assure that:
– The information about Party B recorded in this Agreement is true;
– Have carefully considered and know the property mentioned in Article 1 of this Agreement and the documents on the right to use and own the property (if any);
– The conclusion of this Agreement is completely voluntary, not deceived, not forced;
– To properly and fully perform the agreements stated in this Agreement
Article 12: Other agreements
Party A and Party B agree that they have understood their legal rights, obligations, interests, and the legal consequences of entering into this contract
Party A and Party B agree to comply with the terms of this Agreement and do not specify any other conditions.
This Contract is made into … copies, each copy consists of … pages, has the same legal validity and is assigned to Party A … copies, Party B … copies./.
| PARTY A
(Signature, full name and seal)
… |
PARTY B
(Signature, full name and seal)
… |
Above is an overview of the contract for loan of property dispute and notes when disputing contract for loan of property dispute at court that Phuoc & Partner sharing to the reader If you have difficulty in finding a Law Firm to advise and support in legal aspect related to the banking practice, please contact us. Phuoc & Partners is a consulting firm established in Vietnam and currently has nearly 100 members working in three offices in Ho Chi Minh City, Hanoi and Danang. Phuoc & Partners is also 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.
