THE LAND USE RIGHT OF A PERSON WHO IS NOT THE ORIGINAL OWNER
I. Source of the case
On February 5, 2020, the precedent No. 33/2020/AL was approved by the Council of Judges of the Supreme People’s Court and published under Decision No. 50/QD-CA dated February 25, 2020 of the Chief Justice of the Supreme People’s Court. The source of the case is the Cassation Decision No. 34/2018/DS-GDT dated June 26, 2018 of the Committee of Judges of the High People’s Court in Hanoi (“The Committee”) regarding the land dispute case in Hung Yen province. Persons involved in this proceeding were as follows:
(i) Plaintiffs: Mrs. Bui Thi P and her children Mr. Le Ngoc T1 and Ms. Le Thi Thanh X;
(ii) Respondent: Mr. Le Ngoc T2; and
(iii) 6 other persons with related interests and obligations.
II. Fact of the case
In 1973, Mr. Le Ngoc U, Mrs. Bui Thi P’s father in law, was allocated with the land by the State. In 1975, Mr. Le Ngoc U allowed his nephew, Mr. Le Ngoc T2 (the Respondent), to use his land. Since 1975, Mr. Le Ngoc T2 and his family have cultivated the land and lived in a house which they have built on this land. Local authorities confirmed that Mr. Le Ngoc U did not return to this land, nor did he intend to dispute or reclaim the land, based on the recorded documents and local residents’ information.
On December 20, 1995, Mr. Le Ngoc U passed away without leaving a will. In June 2009, Mr. Le Ngoc H, the only son of Mr. Le Ngoc U passed away without leaving a will. However, before he died, he had told his wife, Mrs. Bui Thi P, to reclaim the land and house possessed by Mr. Le Ngoc T2.
Subsequently, Mrs. Bui Thi P and her children, Mr. Le Ngoc T1 and Ms. Le Thi Thanh X (the Plaintiffs) asked Mr. Le Ngoc T2 (the Respondent) to return the land and house, but Mr. Le Ngoc T2 refused their request. Upon such refusal, Mrs. Bui Thi P and her children brought an action against Mr. Le Ngoc T2 to recover the land and house from him.
In March 2015, the People’s Court of Phu Cu district ruled in favor of the Plaintiffs (“First-instance judgement”). The Respondent appealed against this decision.
In September 2017, the People’s Court of Hung Yen province ruled that the Plaintiffs were entitled to have a land use right, however must return the value of the house attached to the land to the Respondent.
On March 28, 2017, the Chairperson of the High People’s Procuracy requested the Committee to re-hear the case. With the Cassation Decision No. 34/2018/DS-GDT dated June 26, 2018, the Committee found that it is necessary to determine such land and house are legally owned by the Respondent.
III. Applicable regulations:
Articles 170, 185, 190 and 247 of the Civil Code No. 33/2005/QH11 dated June 14, 2005 (“Civil Code”).
IV. Committee’s Reasoning & Legal Application:
The main content of this precedent is to provide the grounds for determining the legal ownership of the land use right and an attached house for the Respondent.
The Committee’s determination was based on Vietnam’s recognition of the principle of adverse possession (or so-called “squatter’s rights). Possession of real estate property for more than 30 years continuously and openly in a good faith amounts to legal ownership of that real estate property under Articles 170.7 and 247.1 of the Civil Code. The Committee found that the Respondent fully satisfied all of such requirements to be considered the owner of the land and house. In particular:
(i) Possession of a property without a legal basis but in good faith: Pursuant to Article 189 of the Civil Code, possession of a property without a legal basis but in good faith means “ A possessor who does not know or could not have known that the possession of such property is without a legal basis.”. In this case, the right to use the land of the Respondent is recognized by Mr. Le Ngoc U, the original land owner who allowed the Respondent to use the land. After Mr. Le Ngoc U’s death, Mr. Le Ngoc H, his son, had also made a written commitment to confirm the transfer of the land use right to the Respondent. In addition, the fact that the Respondent had built a house on the land with his expenses also supports that he had a good faith.
(ii) Continuous possession: Pursuant to the Civil Code, continuous possession means “The possession of property which takes place within a period of time without dispute over such property means a continuous possession…”. In this case, it was confirmed by the local authorities that since the Respondent used the land in 1975 until the time of the Plaintiffs’ lawsuit, there has not been any dispute arising in relation to this land.
(iii) Open possession: According to the Civil Code, a possession is regarded as open when it is performed in an explicit manner, without concealment; the property being currently possessed is used in accordance with its functions and utility and is preserved and kept by the possessor as if it were his/her own property. Since receiving the land, the Respondent has built a house and lived stably on this land, simultaneously declared and paid all kinds of financial obligations to the State. The Committee also stated in the precedent that the Respondent was eligible for a land use right certificate according to the land law. Consequently, the Respondent deemed to have used the land and house openly, without any concealment.
V. Findings of the Committee.
In conclusion, the Committee found that the first-instance court and the appellate court only based on the fact that Mr. Le Ngoc U was granted the land to accept the Plaintiffs’ petition was incorrect, and does not protect the legitimate rights and interests of the Respondent.
The Committee also decided to repeal the whole of the Appellate Judgment No. 25/2017/DS-PT dated September 28, 2017 and assigned the case to the People’s Court of Hung Yen province for re-appellating the case in accordance with the law.
This LBN newsletter are NOT legal advice. Readers are advised to retain a qualified lawyer, should they wish to seek legal advice. VCI Legal are certainly among those and happy to be retained, yet VCI Legal is not to be hold responsible should any reader choose to interpret/apply the regulations after reading this LBN without engaging a qualified lawyer.