Consumers need to be more cautious before advertising products, the object of the transaction is “right to rest” rather than “tourism property”, so it is necessary to consider carefully before making a decision.

Own a tourist property or own a vacation?

A typical litigation case was filed by the People’s Court of Nha Trang (Khanh Hoa) has been selected as a valid court by the Supreme People’s Court’s Judicial Council. The civil lawsuit disputes the contract of vacation ownership between the plaintiff Mrs. Nguyen Thi Long T. and Mr. Nguyen Hoang S. (the plaintiff), the defendant is V Tourist Area Co., Ltd. Own tourism real estate or own vacation?

Specifically, Ms. Nguyen Thi Long T. and Mr. Nguyen Hoang S. have initiated a lawsuit against V. tourist area Co., Ltd in the People’s Court of Nha Trang city with the following content: The Court is requested to declare the Vacation Ownership Contract No. PBRC-S-064621 dated 26/2/2017 null and void and request V. tourist area Co., Ltd to refund to Ms. Nguyen Thi Long T. and Mr. Nguyen Hoang S. the paid amount of VND 300,488,000.

Previously, on February 26, 2017, Ms. T. and Mr. S. entered into a vacation ownership contract No. PBRC-S-064621 with V Resort Co., Ltd. Accordingly, the value of the vacation ownership contract is VND 388,110,000.

According to the plaintiff, at the time of concluding the contract, due to the tight time, Mrs. T. and Mr. S. did not read the contract carefully. On April 26, 2017, after receiving an email from V. Tourist Resort Company Limited, Ms. T. and Mr. S. carefully reviewed the contract signed, there were unreasonable terms of the contract, so they actively proposed to terminate the contract, but were not accepted, and you initiated a lawsuit to the People’s Court of Nha Trang City.

The plaintiff believes that, when participating in signing the contract, the marketing staff of THHH Resort V. Company did not give the plaintiff reasonable time to study the content of the contract is in violation of Article 17 of the Law on Consumer Rights Protection.

However, HDXX believes that the time spent studying the contract is a right of the consumer, the claimant’s failure to use this right is considered as a waiver of his rights. The fact that the plaintiff voluntarily signed the contract is real and at the court hearing, representing the plaintiff still affirms that the signing of the contract is completely voluntary. Therefore, HDXX does not accept the plaintiff’s request.

The argument of HDXX is that “the subject of the vacation ownership contract is the ownership of vacation, not the ownership of tourism property. Accordingly, the Court defines the contract that the plaintiff and defendant have signed together as the “service contract in the field of tourism”.

HDXX believes that this contract is not synonymous with the right to own real estate. The owner of the real estate remains the owner of V. Resort Company Limited during the time of being granted a valid license.

According to lawyer Nguyen Thi Kim Thanh, Lawlink Vietnam Co., Ltd., due to the nature of providing vacation ownership is considered “services in the field of tourism”, the business of buying/selling/exchanging vacation, entering into vacation ownership contracts is not a “real estate business”, and is not subject to real estate business constraints or conditions. The law governing the transaction of vacation ownership contract is mainly civil law.

This case was selected by the Supreme People’s Court’s Judicial Council as Law No. 42/2021/AL (passed on February 23, 2021 and announced on March 12, 2021), on the right to choose the court to resolve disputes of consumers in case the contract is in the form of an arbitration agreement.

Accordingly, the above-mentioned vacation ownership contract belongs to the type of pre-drafted contract made by the service provider, prescribing the arbitration agreement, now the plaintiff is a consumer who does not agree to choose the arbitration and requests the People’s Court of Nha Trang to settle it in accordance with Article 38 of the Law on Protection of Consumer Rights, Article 17 of the Law on Commercial Arbitration and the guidance in Clause 5, Article 4 of Resolution No. 01/20I4/NQ-HĐTP dated March 20, 2014 of the Supreme People’s Council.

Therefore, the People’s Court of Nha Trang City shall accept and settle disputes in accordance with its competence under Clause 3, Article 26, Clause 1, Article 35 of the Code of Civil Procedure and within the limitation period for initiating lawsuits specified in Article 429 of the Civil Code 2015, Article 184 of the Code of Civil Procedure.

What do investors need to do to avoid damage?

According to the lawyer Nguyen Thi Kim Thanh, before signing, the buyer must carefully read the content of the contract, compare the information in the contract with the advertisements and request the investor to send the contract to read first and then arrange the signing. When voluntarily signing, the binding of the contract must be accepted, with no other exception except where the parties reach a consensus to amend the contract.

According to counsel, in the context of disputes arising quite commonly from this type of service provision, the dissemination of judgments and precedents from this dispute is having a positive impact on the market, shaping more clearly the nature of the business of vacation ownership, helping consumers understand this activity and the legal basis.

For consumers, it is necessary to be more cautious before advertising products, now it is possible to understand that the object of the transaction is “right to rest” rather than “tourism property”, so it will be carefully considered before making a decision.

For business organizations, there is a basis to timely review and adjust business activities to both have products and services that are attractive to consumers, and ensure compliance with the law, improve the reputation of enterprises, and through that, regain consumer confidence in this type of service.

“The case and the sentence containing the case as analyzed will have certain impacts on the vacation ownership business market in Vietnam, contributing to creating a safer and more transparent business environment, aiming for more balance for the parties in the vacation ownership contract relationship,” said lawyer Nguyen Thi Kim Thanh.

Source: CafeF