Compilation of Judgments on Apartment Sale and Purchase Contract Disputes

I. Appellate Judgment No. 449/2025/DS-PT on Disputes Over Delayed Apartment Handover

1. General overview of the dispute

• Appellate Adjudicating Body: The High People's Court in Ho Chi Minh City (public hearings held on May 6 and May 13, 2025).

• Appealed Judgment: First-Instance Civil Judgment No. 921/2024/DS-ST dated October 24, 2024, rendered by the People's Court of Ho Chi Minh City.

• Subject Matter of Dispute: Apartment Sale and Purchase Agreement for Apartment No. 25.13 under the Lumière Riverside Project, with a total contractual value of VND 11,286,420,702.

2. Contractual timeline and origin of the outstanding liabilities

• Establishment of initial transaction: On September 29, 2021, the parties entered into a Long-Term Lease Agreement coupled with a covenant to convert into a Sale and Purchase Agreement upon fulfillment of statutory and project conditions.

• Execution of official agreement: On August 22, 2022, the parties executed the Apartment Sale and Purchase Agreement for Apartment No. 25.13. The Plaintiff completed cumulative payments amounting to 95% of the total contract value (equivalent to VND 10,781,017,395).

• Contractual handover milestones:

  • Target Handover Date: June 30, 2023.

  • Notice of Schedule Adjustment: Due to social distancing measures and supply chain disruptions, the developer extended the handover date to October 31, 2023.

  • Official Handover Notice: On October 28, 2023, the developer completed acceptance inspections and issued an invitation notice for the handover of the apartment.

• Actual handover date: February 1, 2024 (a delay of 216 days from the initial target date of June 30, 2023). This period of delay served as the primary basis upon which the Plaintiff initiated litigation claiming contractual delay penalties.

3. Arguments and legal positions of the parties before the Court

Position of the Plaintiff

• The Defendant bore the contractual obligation to complete and hand over the apartment on June 30, 2023, but failed to effectuate physical handover until February 1, 2024.

• The delay period totaled 216 days. Pursuant to the agreed penalty clause at an interest rate of 0.05% per day, the Plaintiff petitioned the Court to compel the Defendant to pay a total penalty sum of VND 1,164,349,879.

Position of the Defendant (P Co., Ltd.)

• Regarding the effective operational date: The transaction constituted an ongoing, uninterrupted legal relationship originating from the Lease Agreement dated September 29, 2021, rather than being confined solely to the date the official Sale and Purchase Agreement was signed.

• Regarding objective impediments: Construction progress was directly hindered by force majeure events (the COVID-19 pandemic resulting in stringent nationwide lockdowns, severe building material supply chain bottlenecks, and geopolitical volatility stemming from the Russia–Ukraine conflict).

• Regarding the purchaser’s fault: The developer completed statutory acceptance and tendered the handover invitation on October 28, 2023 (prior to the extended target date of October 31, 2023). The extension until February 1, 2024, arose because the Plaintiff made the handover installment payment past the due date (on November 13, 2023) and intentionally delayed signing the handover minutes over minor cosmetic defects (scratches, wall paint smudges) which did not legally warrant refusal of handover.

4. Court Judgment and Legal Findings

The Appellate Panel of the High People's Court in Ho Chi Minh City dismissed the Plaintiff's entire appeal and upheld the first-instance judgment, grounded upon the following principal legal findings:

• Continuous validity of the transaction: Although the official Sale and Purchase Agreement was executed on August 22, 2022, the mutual covenants of the parties created binding legal rights and obligations commencing from the Lease Agreement on September 29, 2021.

• COVID-19 pandemic qualified as a force majeure event: The project construction phase coincided with nationwide containment measures and lockdowns. Pursuant to Article 156, Clause 1 of the 2015 Civil Code and the contractual liability-exemption clauses, the period of objective disruption cannot be factored into the assessment of delay penalties.

• Minor cosmetic defects do not constitute grounds to refuse handover: Minor and localized cosmetic imperfections (such as surface scuffs or minor paint stains) do not compromise structural safety standards, regulatory technical building codes, or the core habitable functionality of the residential unit. Such matters fall under warranty rectification liabilities and do not entitle the purchaser to refuse handover.

• Court fee liability: The Plaintiff shall bear the entire first-instance civil court fee of VND 46,930,496 and the appellate civil court fee of VND 300,000.