The right to select court in dispute resolution in Vietnam

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The right to select court in dispute resolution in Vietnam

The determination of Courts’ jurisdiction in resolving contractual disputes in general, civil contracts, business, and commercial contracts disputes, particularly, has an essential role in preparing files for the initiation, accepting the case, resolving disputes, and enforcing the judgment. For selecting the Court to resolve a dispute, firstly, it is necessary to determine whether the Court has the competency to resolve this dispute. If there are grounds to confirm that the dispute falls within the competency of Courts, the territories, court levels, and the plaintiff’s selection shall be considered then. The competency of the Court shall first be determined according to the passage of the plaintiff. In case the plaintiff refuses to perform this right, the jurisdiction of the Court is automatically selected according to the territories and Court levels.

The determination of which Court has competency to resolve disputes between the parties has a significant meaning, direct, and strongly affects the plaintiff’s whole process pursuing the case at the Court. Especially, flexible regulations on the Court’s jurisdiction by the plaintiff’s chose brings a lot of advantages for the plaintiff. In other words, in some circumstances, if the claimant satisfies the conditions as defined by law, he/she might actively constitute advantages such as the right to select the Court according to geographical needs. Regarding civil contracts, business and commercial contracts disputes, pursuant to Clause 3, Article 26, and Clause 1, Article 30 of the Civil Proceedings Code 2015, these disputes fall within the competency of Courts. The plaintiff may choose the courts in situations prescribed in Article 40 of the Civil Proceedings Code 2015, as follows:

(i) Firstly, where the place of residence, workplace of the defendant who is an individual, the head office of the defendant that is an organization is unclear, the plaintiff may submit the petition to the Court where the place of residence, workplace, or last known head office of the defendant is located or where the property of the defendant is situated. The last known address in this situation may be based on the residential address, temporary address, the police station’s address managing the area for individuals, the latest head office’s address announced on the National Business Registration Portal for organizations.

(ii) Secondly, where a dispute arises from the operations of a branch of an organization, the plaintiff may submit the petition to the Court where the organization’s head office or the branch is located. For instance, regarding disputes arising from civil contracts, business, and commercial contracts which are directly signed by the branch or by the organization to serve the branch’s business activities, the claimant has the right to file the case to the Court in the place where the head office is located or where the branch operates.

(iii) Thirdly, where the defendant has no place of residence, workplace, or the defendant is an organization without a head office in Vietnam, the plaintiff may file the lawsuit to the Court where his/her place of residence, workplace, or head office is located.

(iv) Fourthly, where the dispute arises from the contractual relationship, the plaintiff may submit the petition to the Court in the location where the contract is performed. Currently, the laws do not define or limit the scope of the concept “the place where the contract is performed.” Therefore, “the place where the contract is performed” means one, several, or all locations mentioned in the contract, the place where the parties perform entirely or part of the agreement, and there is no basis to determine one area or more. In fact, “the place where the contract is performed” may be defined as the actual places where the parties perform their committed rights and obligations. According to this interpretation, if the contract is performed in different places, the plaintiff may consider selecting the Court at the place where the transaction is largely performed and convenient for proving the petition for legal action.

(v) Lastly, where the defendants are individuals having residencies, workplaces, or the defendants are organizations with head offices in different localities, the plaintiff may file the lawsuit to the Court in the place where one of the defendants’ residence, workplace, or head office is located.

Despite of the regulations on the right of plaintiff to select the Court to hear the dispute, the rules on determining the Court by administrative levels (district or province) still apply and as regulated in Article 35, Article 37 of the Civil Proceedings Code 2015. This is the final step to figuring out precisely a court having competency to resolve the dispute. 

Based on the above analysis, the mutual agreement to select the Court in advance to resolve a dispute in the contract is only useful in case satisfies the following conditions: (i) the chosen Court is in the place where the plaintiff’ residence or head office , (ii) complying with the competency of Courts by administrative levels as regulated in Article 35, Article 37 of the Civil Proceedings Code 2015.