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Contribution to purchase land – Legal view


Laws on co-ownership of real estate?

The general property co-ownership regime is detailed in Articles 207 to 220 of the Civil Code 2015. Accordingly, the 2015 Civil Law introduces the concept of “Common ownership is the ownership of many subjects to with property”.

Applied to land use rights, houses and land-attached assets (hereinafter collectively referred to as real estate), Clause 2, Article 98 of the 2013 Land Law prescribes the principles for granting use right certificates. land, ownership of houses and other land-attached assets, then: “In a parcel of land with many people sharing the same land use rights, and many people sharing houses and other land-attached assets, the certificate of land use right shall be Land use rights and ownership of houses and other land-attached assets must be fully recorded with the names of persons sharing land use rights, co-owners of houses and other land-attached assets, and shall be granted to each person. 01 Certificate, in case the users and owners request, jointly issue one Certificate and give it to the representative.”

Through the above provisions, we understand that the law fully recognizes and protects the interests of all owners when jointly owning any property, including real estate. In other words, it is completely legal to buy real estate under the same name, without any legal restrictions.

However, despite being recognized by law, with binding and protective regulations, buying real estate together still presents certain risks.

Typical risks when contributing money to buy land together and limiting risks according to the law

  • Restrictions on the right to dispose of and the right to use real estate.

Accordingly, in order to effectively exercise the right to dispose and use real estate as a common property, consent from all co-owners is required. That is, when performing the conversion, transfer, gift or any other transaction as well as use, all co-owners of that real estate must agree, directly or authorize another person. carry out legal procedures.

In practice, co-owners do not always reach a high consensus. In many cases, the co-owners conflict and lead to disputes, making the disposition of common property as well as the exploitation and use of the common property impossible. In this case, it is necessary to exchange and discuss with each other to come to an agreement or settle the dispute in accordance with the law.

According to the provisions of article 218 of the Civil Code 2015:

“1. Each joint owner in part has the right to dispose of his share of ownership.

2. The disposition of the consolidated common property shall be done according to the agreement of the common owners or according to the provisions of law.

3. In case a common owner sells a portion of his/her ownership rights, the other co-owners have the right to pre-emptive purchase. Within 3 months for common property being immovable property, 01 month for common property being movable, from the date on which other common owners receive notice of the sale and sale conditions without any If a common owner buys it, that owner has the right to sell it to another person. The notice must be in writing and the terms of sale to other common owners must be the same as those of the sale to a non-common owner.

In case of selling a portion of the ownership right with a violation of the right of priority to purchase, within 3 months from the date of detecting the violation of the right of priority to purchase, the joint owner according to the part among the owners The common owner has the right to request the Court to transfer to him/her the rights and obligations of the buyer; The party at fault causing damage must compensate for the damage.

And specifically for common property which is real estate, at Point b, Clause 2, Article 167 of the Land Law stipulates:

In the case of a group of land users in which the land use right can be divided into parts for each member of the group, if each member of the group wants to exercise the right to his/her share of the land use right, he/she must carry out the following procedures: split plots according to regulations, carry out procedures for issuance of certificates of land use rights, ownership of houses and other land-attached assets, and exercise the rights and obligations of land users in accordance with this Law. .

In case the land use rights of a group of land users cannot be divided into parts, they shall authorize a representative to exercise the rights and perform the obligations of the group of land users.

Thus, it can be seen that, if the co-owners of the immovable property do not agree on the right to dispose and/or exploit the right to use the immovable property, then:

– In case the Certificate is clearly divided according to the share of ownership in the common property, the co-owners can only sell the part of the recognized rights. But it is forced to carry out the procedure for splitting the parcel in proportion to the use right of that co-owner. And according to current legal regulations, the separation of parcels must ensure the minimum area when separating the plot as prescribed, which means that at this time, the public co-owners can not carry out the procedures to separate the plot and in fact, the Partitioning also takes a lot of time and effort to complete.

– In case the immovable property is not recorded in division, the co-owners can authorize a representative. And if it is not possible to authorize or agree on the division, the co-owners can only carry out the proceedings at the Court to determine the land use right. And the dispute settlement procedure at the Court can be lengthy, costly and time consuming for the parties.

In order to limit the risks that may arise in the exercise of the owner’s rights to the above-mentioned common property, the co-owners need to clearly agree with each other on the part of the property in the common property. responsibilities and rights of each person with respect to the right to exploit and dispose of the common land. And must concretize the above agreements in writing, signed by the parties involved. This will be an important legal document for the parties to always “remember” the obligations so that they can jointly perform their rights and obligations as originally agreed. will be an important basis for the case to be resolved, ensuring the interests of the parties according to the original agreement.

  • The co-owners are at risk of getting involved in disputes beyond their control:

Each co-owner himself will have surrounding relationships that may arise disputes over property such as: marital relationship, inheritance relationship, or performance of obligations with a third party… In many cases When a dispute occurs by any co-owner regarding his/her share of the common property, it also causes the whole property to be disputed, and the remaining co-owners are also “accidentally” dragged into the story of an unexpected dispute.

According to Article 188 of the 2013 Land Law, one of the conditions for exercising the rights to exchange, transfer, lease, sublease, inherit, donate or mortgage land use rights; capital contribution by land use right is “Land without dispute”.

Thus, although getting involved in a dispute is not expected of the co-owners, in order to exercise the rights of the real estate owner, the parties must wait for the case to be resolved in accordance with the new law. can be done. And there are also many cases where this waiting pulls and pushes the parties into difficult situations and incurs costs.

In many cases, in the initial agreement document, the co-owners will have recorded the agreement on the disposition of the assets of each co-owner in the common property when related disputes arise. to the share of the property of the co-owner. However, this agreement has virtually no obligations to third parties and may be void. Therefore, getting involved in unexpected disputes is something that investors must know and anticipate depending on the actual situation as well as the “friends” with whom we cooperate to buy land together.

  •  The risk of appearing other co-owners outside the plan, breaking the original agreement. 

As analyzed in items (1) and (2), according to the law, the property rights of each co-owner to common property are recognized and protected by law. Accordingly, the common property of one/co-owners can be transferred to a completely new person, even a stranger to friends who jointly contributed to buying real estate from the beginning through relationships. arising laws such as inheritance, division of common property between husband and wife or through transactions of sale, donation, mortgage, capital contribution, etc. In fact, the new co-owners may accidentally or intentionally break it. follow the rules that the co-owners agreed to from the beginning. Thereby affecting the right to dispose, as well as to use real estate as common property, there may also be disputes between co-owners.

Establishing written agreements will somewhat limit the risk that new co-owners may break the original agreements. However, accompanying a co-owner who is not close friends will also be one of the things worth considering.

  • Risks for individuals who jointly contribute money to buy real estate but are not named on the Certificate:

Administrative procedures related to establishing ownership as well as real estate transactions are now more or less time consuming for owners, besides because this is a registered property, there are many cases because For different reasons, some individuals, although they have contributed money to buy real estate, have appointed another person to name it, while they themselves do not record the owner information on the Certificate.

According to Clause 16, Article 3 of the 2013 Land Law, land use right certificates are prescribed as follows: “16. A certificate of land use rights and ownership of houses and other land-attached assets is a legal document for the State to certify land use rights and ownership of houses and other land-attached assets. law of the person who has the right to use land, the right to own a house and the right to own other properties attached to the land.”

According to Clause 1, Article 97 of the 2013 Land Law: “(1). Certificates of land use rights, ownership of houses and other land-attached assets shall be granted to persons with land use rights, house ownership rights and ownership of other land-attached assets according to a category. uniform model throughout the country.”

According to the above provisions, the Certificate is a very important legal document showing who is the owner of the property, thereby having the right to exploit and dispose of this property. In other words, only the person named on the Certificate can dispose of and use the land recognized by law. Therefore, the fact that a group of common co-owners for any reason does not have a common name on the Certificate but instead appoints a representative, from a legal perspective, only the person named is recognized. As the owner, this person can exercise all the rights of an owner by himself without going through any opinions of the other people who contribute money to buy the remaining real estate. There have been many cases of disputes related to the transaction of the representative in his name. In addition, similarly, there will be many cases where real estate is taken out to perform obligations for the representative in the name or forced to be transferred to another party when inheritance relationships arise, common property during the period of time. marriage period… as mentioned above that the people who contribute money to buy the land together can’t be foreseen.

And of course, the most effective way to limit this risk, we recommend that co-owners put their name on the Certificate in any case. In the case of saving time and effort in carrying out procedures related to real estate transactions, co-owners can completely entrust the exercise of their rights to a trusted third party. through authorized transactions.

Because the disputes related to the contribution of money to buy the common land did not appear in the initial time but only arise a long time later. Therefore, it is very necessary to consult with lawyers or other professionals from the very beginning as well as to establish sufficient and legal documents from the very beginning to ensure the interests of all stakeholders. all investors.

Information of the lawyer advising on land law:

Above is the lawyer’s entire share on the issue of risks when contributing money to buy land from a legal perspective. For each specific case, please contact Vo Consultants for detailed advice. We hope that the article brings us useful knowledge.

Contact a consulting lawyer: 0909 865 891 – 0901 476 391 (Attorney Vo Man)

Email address: hello@voconsultants.vn

Website: https://voconsultants.vn

Office address: 8th floor, Callary Building, 123 Ly Chinh Thang, Vo Thi Sau Ward, District 3, Ho Chi Minh City.

Best regards./.



Lawyer Vo Thi Man

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