Performing contract liquidation procedures plays an important role in civil activities. Through the liquidation of the contract in general, the parties will confirm the extent to which the contract has been performed, according to the original agreement, thereby determining the remaining obligations of the parties. So about the matter “Regulations on the principle of contract liquidation in Vietnam” Let’s find out with LSX in the article below.
Legal grounds
- Civil Code 2015
What is a contract?
A contract under the provisions of the Civil Code 2015 “is an agreement between the parties on the establishment, change or termination of civil rights and obligations”. It is an agreement between parties to buy, sell, exchange, give, lend, lease, borrow property or perform a job, thereby establishing, changing or terminating the right and civil obligations between the parties in the contract.
In Vietnam, since opening the door to build a socialist-oriented market economy, “the purchase and sale of goods is carried out on the basis of contracts”. Therefore, the contract is the central institution of civil life and is regulated in the laws with special legal value in each country and that is the Civil Code. However, not only the civil sector, contracts also exist in many different fields, namely the business and commercial sectors. In the contract system, the invalid contract is a very important part and content. Research shows that, not only in the current regulations, invalid contracts have been specified in very detailed, strict and clear legal documents before the reunification of the country in Vietnam. However, first of all, it is necessary to understand the definitions of the contract, so that from there, it is possible to know deeply about the void contract.
When to liquidate the contract?
In fact, in the current legal regulations, there is no recorded definition of the term contract liquidation in the Civil Code. The liquidation of contracts is done very often and continuously. Based on the provisions and purposes of contract liquidation, we can give the concept of contract liquidation.
Contract liquidation is understood as a record of two parties to the contract, after completing a job. In which, the minutes will be re-confirmed by the two parties on the terms and content of the work has been performed as committed to the contract and if there are any arising problems after the work has been completed and the minutes have been completed. This agreement is signed by 02 parties to sign the contract.
Contract liquidation shall be effected in the following cases:
+ The contract has been completed according to the schedule, requirements and terms of the two parties;
+ According to the agreement, the parties want to terminate the contract for liquidation;
+ The subject of the contract dies or in case the legal person entering into the contract ceases to exist, the contract must be performed by that individual or legal entity;
+ The contract is canceled or unilaterally terminated by one of the parties;
+ The contract cannot be performed because the object of the contract no longer exists;
+ The contract is terminated due to a fundamental change in circumstances;
+ Other cases prescribed by law.
Purpose of the liquidation of the contract
Contract liquidation has not yet been recorded in legal documents. But still, many individuals and organizations pay attention and are very popular. By:
Through the liquidation of the contract by the parties, the parties will confirm to what extent the work has been completed, whether it meets the requirements and criteria in the contract or not.
Thereby determining the obligations and responsibilities and consequences of the parties after the liquidation of the contract. In addition, from the time when the parties have signed the minutes of liquidation, the contractual relationship is considered to have been terminated and the parties need to quickly complete the outstanding obligations of the contract, if any.
At the same time, the liquidation can also limit future disputes as well as serve as a basis for settlement of backlogs when the parties still deliberately fail to fulfill their contractual obligations recorded in the contract. contract liquidation.
Conditions to liquidate the contract according to regulations
Although there is no regulation directly stating the conditions for liquidation of the contract. However, in principle, the Civil Code always respects the principle of freedom, voluntary commitment and agreement as long as it is not contrary to the provisions of the law as prescribed in Article 3 of the 2015 Civil Code as follows:
“first. All individuals and legal entities are equal and must not use any reason to discriminate; are equally protected by law in terms of personal and property rights.
2. Individuals and juridical persons shall establish, perform and terminate their civil rights and obligations on the basis of freely and voluntarily committing and agreeing. All commitments and agreements that do not violate the prohibition of the law, are not contrary to social ethics are effective for the parties and must be respected by other subjects.
3. Individuals and legal entities must establish, perform and terminate their civil rights and obligations in good faith and honestly.
Regulations on the principle of contract liquidation in Vietnam
The principles of contract liquidation are specified in Article 422 of the Civil Code, specifically as follows:
Article 422. Termination of contract
The contract terminates in the following cases:
1. The contract has been completed;
2. As agreed by the parties;
3. The individual entering into the contract dies, the legal person entering into the contract ceases to exist, but the contract must be performed by such individual or legal entity;
4. The contract is canceled or unilaterally terminated;
5. The contract cannot be performed because the subject matter of the contract no longer exists;
6. The contract is terminated according to the provisions of Article 420 of this Code;
7. Other cases prescribed by law.
Contract liquidation process
Procedures for liquidation and termination of contracts are divided into two cases
The parties agree to liquidate and terminate the contract
When terminating this type of contract due to the agreement of the parties; and usually applies when the contract is completed or the parties have no need to continue the contract. Therefore, the notification procedure for signing and terminating the contract is quite simple; and not be constrained by regulations on obligations; advance notice or reconciliation of the remaining obligation.
Unilaterally requesting cancellation or termination of the contract at the will of one party
When a party to the contract unilaterally cancels or terminates; the contract is based on the terms agreed in the contract that the party unilaterally needs
– In case of cancellation or termination of the contract according to the agreed contents; in the signed contract, the party unilaterally cancels or terminates the contract; send a notice to the partner, noting the time of termination should be after about 15 days from the date of notice.
– In case of canceling or terminating the contract according to circumstances beyond the agreement in the contract, it is necessary to base on the provisions of Articles 424, 425, 426 of the Civil Code 2015 to ensure the implementation of the legal process.
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Frequently asked questions
Contract liquidation minutes is a record recorded after completion of an unsigned job, which is re-confirmed by the two parties on the volume, quality, and problems arising after the completion of that work and the two parties agree to sign.
The contents of the liquidation of the contract should clearly state the following two contents:
– The first is about the fact that your company has fulfilled its payment obligations, the two parties commit that there will be no disputes in the future over this content;
– Second, about warranty obligations, the two parties agree that the seller’s warranty will continue to be valid after the two parties sign the contract liquidation minutes and continue until the end of the agreed warranty period. agreement of the two parties in the contract for the supply of goods. If the goods supply contract has not specified this in detail, the liquidation minutes must clarify and both parties must agree to these contents.
Contract liquidation is not mandatory. If the parties reach an agreement, the contract shall be liquidated according to the agreement of the parties.
In this case, the parties will draft a draft contract liquidation minutes until the parties reach consensus, then proceed to sign the contract liquidation minutes.
After the liquidation of the contract, the rights and obligations of the parties shall comply with this record of liquidation.
Particularly in the case of unilateral liquidation of the contract, the unilateral party must also base on the terms of the previous contract
Conclusion: So the above is Regulations on the principle of contract liquidation in Vietnam. Hopefully with this article can help you in life, please always follow and read our good articles on the website: lsxlawfirm.com
