Entering into civil contracts is a very important activity. Let’s find out this issue with Lawyer X through the following situation: “Dear Lawyer! I want to ask what does a civil contract mean in Vietnam? Can a person offer another person to enter into a contract in unclear way? When shall an offer to enter into a civil contract terminate? Thanks for answering me!”
Legal grounds
- 2015 Vietnam Civil Code
Definition of civil contract
Civil contract means an agreement between parties in relation to the establishment, modification or termination of civil rights and obligations.
Offers to enter into civil contracts
– Offer to enter into a contract means a clear expression by the offeror of its intention to enter into a contract and to be bound by such offer made to another specific party or the public (hereinafter referred to as the offered).
– Where an offer to enter into a contract has specified the time for reply and the offeror enters into a contract with a third person during the time limit for reply by the offeree, if the offeror fails to enter into the contract with the offeree and the offeree suffers damage, the offeror must compensate the offeree for such damage.
Information in entering into contracts
– Each party must notify the other party of any piece of information affecting the acceptance of offer to enter into the contract by the latter party.
– When a party receives any secret information from the other party during the process of entering into the contract, it must protect that information and may not use it for its own purposes or other illegal purposes.
– Any party violating Clause 1 or Clause 2 of Article 387 thereby causes damage must compensate for it.
Time limit within which offer to enter into contract remains effective
– The time limit within which an offer to enter into a contract remains effective shall be determined as follows:
+ Where an offeror has specified such time limit;
+ Where an offeror has not specified the time limit, the offer to enter into the contract is effective as from the time the offeree receives the offer.
– The following cases shall be deemed to be receipt of an offer to enter into a contract:
+ The offer is delivered to the place of residence if the offeree is a natural person, or the offer is delivered to the head office if the offeree is a juridical person;
+ The offer is placed into the official information system of the offeree;
+ When the offeree knows about the offer to enter into a contract by way of other means.
Modification or withdrawal of offers to enter into contracts
– An offeror may modify or withdraw an offer to enter into a contract in the following cases:
+ If the offeree receives notice of modification or withdrawal of the offer prior to or at the same time as receipt of the offer;
+ The offeror clearly specified the circumstances in which the offer could be modified or withdrawn and such circumstances have in fact arisen.
– When the offeror modifies the contents of the offer, that offer shall be deemed to be a new offer.
Rescission of offers to enter into contracts
If the offeror exercises the right to rescind the offer to enter into a contract on the ground that such right was specified in the offer, the offeror must notify the offeree and such notice shall only be effective if the offeree receives the notice prior to the offeree providing its acceptance of the offer to enter into the contract.
Termination of offers to enter into contracts
An offer to enter into a civil contract shall terminate in the following cases:
– The offeree replies that the offer is accepted.
– The offeree replies that the offer is not accepted;
– The time limit for acceptance has expired;
– When notice of modification or withdrawal of the offer becomes effective;
– When notice of rescission of the offer becomes effective;
– As agreed by the offeror and the offeree within the time limit within which the offer to enter into a contract remains effective.
Amendment of offer proposed by offeree
When an offeree accepts the offer to enter into a contract but specifies conditions or amendments to the offer, the offeree shall be deemed to have made a new offer.
Acceptance of offers to enter into contracts
– Acceptance of an offer to enter into a contract means a reply by the offeree to the offeror accepting the entire contents of the offer.
– The silence of the offeree shall not mean an acceptance of the offer to enter into the contract, unless it is agreed upon or habit established by the parties.
Time limits for acceptance of offers to enter into civil contracts
– Where an offeror has specified a time limit for reply, a reply accepting shall only be effective if it is made within that time limit. If the offeror receives an acceptance after the time limit has expired, such acceptance shall be deemed to be a new offer from the party which is late in replying.
When the offeror does not specify the time limit for reply, the reply accepting shall only be effective if it is made within reasonable period.
– If a notice of acceptance of an offer to enter into a contract arrives late for objective reasons which the offeror knows or should know, such notice shall still be effective, unless the offeror immediately replies that it does not agree with such acceptance by the offeree.
– Where the parties communicate directly, including conversations by telephone or other means of communication, the offeree must reply immediately as to whether or not it will accept, except where there is an agreement on the time limit for reply.
Cases where offeror dies or lacks of legal capacity or has limited cognition and behavior control
Where the offeror dies or lacks of legal capacity or has limited cognition and behavior control after the offeree has replied accepting the offer, the offer to enter into a contract shall still be valid, unless the contents of contract is associated with the personal identity of the offeror.
Cases where offeree dies or lacks of legal capacity or has limited cognition and behavior control
Where the offeree dies or lacks of legal capacity or has limited cognition and behavior control after the offeree has replied accepting the offer, the offer to enter into a contract shall still be valid, unless the contents of contract is associated with the personal identity of the offeror.
Withdrawal of notice of acceptance to enter into contract
The offeree may withdraw notice of acceptance to enter into a contract if such notice arrives prior to or at the same time as the offeror receives the reply accepting the offer to enter into a contract.
Regulations on contents of contracts
– The contracting parties may agree on the contents of a contract.
– A contract may have the following contents:
+ Subject matter of the contract;
+ Quantity and quality;
+ Price and method of payment;
+ Time limit, place and method of performing the contract;
+ Rights and obligations of the parties;
+ Liability for breach of contract;
+ Methods of settlement of disputes.
Places for entering into contracts
The place where a contract is entered into shall be as agreed by the parties; if there is no agreement, such place shall be the residence of the individual, or the head office of the legal entity, having made the offer to enter into the contract.
Time when contracts are entered into
– A contract is entered into at the time when the offeror receives the reply accepting to enter into the contract.
– If the parties have agreed that silence shall constitute an acceptance within a time limit, the contract shall also be deemed to be entered into when such time limit has expired.
– The time when an oral contract is entered into is the time when the parties have reached agreement on the contents of the contract.
– The time when a written contract is entered into shall be the time when the last party signs the contract or by other forms of written acceptance.
If a contract is entered into orally and then it is made in writing, the time when the contract is entered into shall be determined as prescribed in Clause 3 of Article 400.
Regulations on effectiveness of contracts
– A contract legally entered into shall take effect from the time when it is entered into, unless otherwise agreed or otherwise provided by law.
– From the effective date of the contract, contracting parties must mutually exercise rights and perform obligations as agreed. A contract may be amended or terminated as agreed by the parties or prescribed by law.
Principal types of contracts
Contracts comprise the following principal types:
– A bilateral contract is a contract whereby each party has an obligation to the other;
– A unilateral contract is a contract whereby only one party has an obligation;
– A principal contract is a contract the effectiveness of which does not depend on another contract;
– An ancillary contract is a contract the effectiveness of which depends on a principal contract;
– A contract for the benefit of a third person is a contract whereby contracting parties must perform obligations for the benefit of a third person and the third person enjoys benefits from such performance;
– A conditional contract is a contract the performance of which depends on the occurrence, modification or termination of a specified event.
Appendices to contracts
– Appendices providing details on certain terms and conditions of a contract may be attached to the contract. The appendices shall have the same effectiveness as the contract. The contents of the appendices shall not contradict the contents of the contract.
– If the terms and conditions of the appendices contradict the terms and conditions of the contract, such terms and conditions of the appendices shall be ineffective, unless otherwise agreed. If the parties agree that the terms and conditions of the appendices contradict the terms and conditions of the contract, the terms and conditions of the contract which are contradicted shall be deemed to have been amended.
Interpretation of contracts
– Where a contract contains terms and conditions which are unclear, the interpretation of such terms and conditions shall be based not only on the wording of the contract but also on the mutual intentions of the parties during the process prior to and after the time of establishment and performance of the contract.
– Where a term of a contract may be interpreted in different ways, it shall be interpreted in the way which, when effective, will best benefit the parties.
– Where the wording of a contract may be interpreted in different ways, such wording shall be interpreted in the way most appropriate to the nature of the contract.
– Where a contract contains a term or wording which is difficult to understand, such term or wording shall be interpreted in accordance with the customary practice of the place where the contract was entered into.
– Where there is a conflict between the mutual intentions of the parties and the wording used in the contract, the mutual intentions of the parties shall be used in order to interpret the contract.
– Where the party in a powerful position inserts into the contract contents which are disadvantageous to the party in a weak position, the contract shall be interpreted in a manner favoring the party in a weak position.
Standard form contracts
– Standard form contract means a contract containing terms and conditions which are prepared by a party based on a standard form requiring the other party to reply within a reasonable period of time. If the offeree accepts, it shall be deemed to have accepted the entire contract provided by the offeror.
The standard form contract must be public in order for the parties to know or should know the contents of the contract.
Procedures for announcement of standard form contract shall comply with regulations of law.
– Where a standard form contract contains terms and conditions which are unclear, such terms and conditions shall be interpreted in a manner favoring the offeree.
– Where a standard form contract contains provisions exempting the party providing such standard form contract from liability, or increasing the liability of or waiving legitimate interests of the other party, such provisions shall be ineffective, unless otherwise agreed.
General trading conditions in concluding contracts
– General trading conditions are stable terms announced by a party to apply to the offeree; if the offeree accepts the contract is then deemed to accept these terms.
– General trading conditions shall be effective only with the parties as long as these conditions have been publicly in order for the parties to know or should know them.
The procedures for announcement of general trading conditions shall comply with regulations of law.
– The general trading conditions must ensure equality between the parties. If the general trading conditions contain provisions on discharge of liability from the party giving the general trading conditions, increase of responsibility or removal of the legitimate interests of the other party, these provisions do not take effect, unless otherwise agreed.
Regulations on invalid civil contracts
– The provisions on invalid civil transactions in Articles 123 to 138 inclusive of Vietnam Civil Code shall also govern invalid contracts.
– Invalidity of a principal contract shall terminate an ancillary contract, unless the parties agree that the ancillary contract replaces the principal contract. This provision shall not apply with respect to security for the performance of civil obligations.
– Invalidity of an ancillary contract shall not terminate the principal contract, unless the parties agree that the ancillary contract is an inseparable part of the principal contract.
Invalidity of civil contracts due to impossibility of performing subject matter
– If, immediately as from the time a contract is signed, it is impossible to perform the subject matter of the contract for objective reasons, the contract shall be invalid.
– If, when entering into a contract, one party knew or should have known that it was impossible to perform the subject matter of the contract for objective reasons but failed to notify the other party which entered into the contract, the former party must compensate the latter party for damage, unless the latter party knew or should have known that it was impossible to perform the subject matter of the contract.
– The provision in Clause 1 and Clause 2 of Article 408 shall also apply to a contract containing one or more parts with subject matter which is impossible to perform, but the remaining parts of the contract shall remain valid.
Please see more:
- Instructions for exclusive registration of company logos in Vietnam
- Service of changing the legal representative of Vietnamese enterprises
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Frequently asked questions
Appendices providing details on certain terms and conditions of a contract may be attached to the contract. The appendices shall have the same effectiveness as the contract. The contents of the appendices shall not contradict the contents of the contract.
Where a contract contains terms and conditions which are unclear, the interpretation of such terms and conditions shall be based not only on the wording of the contract but also on the mutual intentions of the parties during the process prior to and after the time of establishment and performance of the contract.
Where a term of a contract may be interpreted in different ways, it shall be interpreted in the way which, when effective, will best benefit the parties.
Conclusion: So the above is Entering into civil contracts according to Vietnam legal regulations. Hopefully with this article can help you in life, please always follow and read our good articles on the website: lsxlawfirm.com
