Source of the case

On 05 February 2020, the Council of Judges of the Supreme Court passed the Precedent No. 34/2020/AL regarding rights to make wills to dispose of land compensations in case of state expropriation with compensation (“Precedent 34”).

The source of Precedent 34 is the Cassation Decision No. 58/2018/DS-GDT on 27 September 2018 of the Committee of Judges of the High People’s Court in Hanoi on the case “Disputing on requesting for invalidation of notarized documents” in Vinh Phuc province between the plaintiff, Mr Tran Van Y (“Mr Y”) and the defendant, M. Notary Office. The person with related rights and obligations is Mr Nguyen Van D1 (“Mr D1”).

Material facts

Since 1957, Mr Nguyen Van D (“Mr D”) and Mrs Nguyen Thi C (“Mrs C”) had lived together without marriage registration.  In 1959, Mr D and Mrs C, throughout a series of purchase procedures, started to own parcel No. 38, map No. 13 (“Land No. 38”).

In 1987, Mr Y purchased the Land No. 38 from Mrs C via a transfer land use right agreement.  However, sometime after this transaction, Mrs C and Mr D made a will to leave the Land No. 38 for their son, Mr D1.

In January 2011, after Mr D and Mrs C passed away, the M. Notary Office issued an announcement regarding Mr D and Mrs C’s will on their inherited property.

In 2013, Mr Y learned about the notarized will of Mr D and Mrs C and the announcement from M. Notary Office. Mr Y requested the People’s Court of Vinh Yen City to declare the notarized will made by the M. Notary Office invalid on the grounds that such notarization was not made in accordance with the law.

On 28 April 2014, the first instance People’s Court of Vinh Yen City declared the notarized will made by M. Notary Office invalid through its judgment No. 10/2014/DS-ST (“First Instance Court Judgment”). Mr D1 appealed against this decision.

On 27 April 2015, through the appellate court judgment No. 23/2015/DS-PT of Vinh Phuc province People’s Court (“Appellate Court Judgment”), the Appellate Court decided to preserve the First Instance Court Judgment.

On 11 April 2016, disagreeing with the Appellate Court Judgment, Mr D1 continued to request for consideration under cassation procedure for the Appellate Court Judgment.  In September 2018, the Committee of Judges of the High People’s Court in Hanoi did not agree with the Appellate Court Judgment and decided to return the case back to the first instance People’s Court of Vinh Yen City for a retrial the case. This Precedent is based on the part of “right to make wills to dispose of land compensation” only.

Applicable Laws

• Articles 163, 181, 634, 646 and 648 of Civil Code No. 33/2005/QH11 dated 14 June 2005 (“Civil Code”); and
• Article 42 of Land Law No.13/2002/QH 11 dated 26 November 2003 (“Land Law”)

Analysis legal issues on Precedent 34

According to the general contents of Precedent 34, in the event that the land use right is (i) legally created by a person and (ii) when he/she is still alive, the State has made a decision to confiscate the land and such land is in the case of compensation. In this case, the value of the recovered land use right is guaranteed by the compensation value and the person whose land is recovered shall have the right to make a will to dispose of that compensation value.

The first conditions for applying Precedent 34 is (i) the land use right must be legally created by a person. In this case, Mr D and Mrs C was purchased a parcel of land via a contract which was confirmed by the People Committed of T. town. Then, Mr D and Mrs C had exchanged such land with the N. Co-operative to take Land No. 38. Their land use right could be legally recognized under Vietnamese Land Law if they was “using land in a stable manner, with certification by commune/ward/township People’s Committees that it is free from disputes, and have Papers on transfer of land use rights, on purchase and sale of dwelling houses affixed to residential land before October 15, 1993, and now being certified by commune/ward/township People’s Committees as having been used before October 15, 1993.”

The second conditions for applying Precedent 34 is (ii) when the land owner is still alive, the State has made a decision to recover the land and the land recovery is in the case of compensation. Accordingly, Land No.38 was expropriated by the State under Decision 1208 in 2010 while Mr D and Mrs C were still alive. According to the Land Law, Mr D and Mrs C “shall be compensated with the assignment of new land of the same use purposes; if having no land for compensations, shall be compensated with the land use right value at the time of issuance of the recovery decisions.” The value of land use right No. 38 still guaranteed by the State, Therefore, Mr D and Mrs C still have the right to be compensated or leave it for their son, as an inherited property, if they meet such requirements as prescribed above.

Findings of the Committee

In conclusion, based on above reasoning, the Committee of Judges of the High People’s Court in Hanoi determine that it is necessary to consider simultaneously the legitimate of (i) transfer land use right agreement between Mr Y and Mrs C; (ii) the wills made by Mr D and Mr C as well as (iii) the announcement of M. Notary Office regarding Mr D and Mrs C’s wills on their inherited property to thoroughly resolve the case and ensure the rights and interests of the litigants. Therefore, the Committee of Judges of the High People’s Court in Hanoi decided to repeal the whole of the Appellate Judgment No. 23/2015/DS-PT dated 27 April 2015 and assigned the case to the People’s Court of Vinh Yen city, Vinh Phuc province for retrial the case in accordance with the law.

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