1. What is Non-Contractual Damage Compensation?
Non-contractual damage compensation is a form of civil liability that arises when an unlawful act causes harm to another person, irrespective of whether a contract exists between the parties. Pursuant to Article 584 of the Civil Code of Vietnam 2015, non-contractual damage compensation applies when an individual or organization commits an unlawful act that infringes upon the life, health, honor, dignity, reputation, property, or other lawful rights and interests of another, resulting in damage.
For non-contractual damage compensation liability to arise, the following elements must be present:
- The act causing the damage must be unlawful.
- Actual damage must have occurred (either material or non-material).
- There must be a causal relationship between the unlawful act and the damage incurred.
- The person causing the damage must be at fault (either intentionally or unintentionally).
2. Principles of Non-Contractual Damage Compensation
The principles of non-contractual damage compensation are stipulated under Article 585 of the Civil Code 2015 and further guided by Article 3 of Resolution No. 02/2022/NQ-HĐTP, as follows:
– Actual Damage Must Be Fully and Promptly Compensated. Parties may mutually agree on the amount of compensation, the form of compensation (in cash, in kind, or through the performance of an act), and the method of compensation (one-time or in installments), unless otherwise provided by law.
+ Actual Damage: This refers to damage that has occurred and is quantifiable in monetary terms at the time of resolution. Damage arising after the initial compensation resolution shall be determined at the time of any subsequent resolution, should the injured party make such a request.
Example: A causes injury to B, requiring B to undergo prolonged medical treatment. At the time the court resolves the compensation, the total actual damage amounts to X VND, including treatment costs, loss or reduction of income, caregiving expenses, and non-material harm. If B requires further treatment thereafter, additional costs arising after the court’s initial resolution may be addressed in a separate case upon B’s request.
+ Full Compensation: All actual damage incurred must be compensated.
+ Prompt Compensation: Damage must be compensated swiftly to prevent, limit, or remedy the harm.
During case proceedings, courts may apply one or more provisional emergency measures under civil procedure law to address urgent requests from the injured party (e.g., ordering partial fulfillment of compensation obligations due to infringement of life or health, or partial fulfillment of alimony obligations).
+ To ensure full and prompt compensation, the resolution of compensation issues in criminal or administrative cases must be conducted concurrently with the resolution of those cases.
In cases where a criminal or administrative case involves compensation issues but lacks sufficient evidence and does not affect the resolution of the criminal or administrative matter, the compensation issue may be separated and resolved under civil procedure rules.
+The party requesting compensation must specify each item of actual damage incurred, the requested compensation amount, and provide documents and evidence to substantiate their claim.
If the requesting party cannot independently collect evidence, they may request the court to gather such evidence in accordance with the Civil Procedure Code.
– Reduction of Compensation Liability. The person responsible for compensation may have the amount reduced if they are not at fault or are unintentionally at fault, and the damage is disproportionately large compared to their financial capacity.
Disproportionately Large Damage: This applies when there is evidence proving that requiring full compensation would render enforcement impossible due to the responsible party’s financial situation.
Example: An individual unintentionally causes a fire that destroys another’s house, resulting in damage of 1,000,000,000 VND. The responsible party owns assets worth 100,000,000 VND and earns an average monthly income of 2,000,000 VND. The damage is deemed disproportionately large relative to their financial capacity.
– Adjustment of Compensation Amount. If the compensation amount becomes inconsistent with reality, either the injured party or the party causing the damage may request a court or another competent state authority to adjust the amount.
Inconsistency with Reality: This refers to changes in economic-social conditions, price fluctuations, changes in the injured party’s health or labor capacity, or changes in the responsible party’s financial capacity, rendering the original compensation amount unsuitable.
The requesting party must submit a formal request for adjustment, accompanied by supporting documents and evidence justifying the change.
– Fault of the Injured Party. If the injured party is partially at fault for causing the damage, they are not entitled to compensation for the portion of damage attributable to their fault.
Example: A and B, both driving cars, collide in a traffic accident, causing A damage of 100,000,000 VND. A competent authority determines that A and B are equally at fault (50% each). In this case, B must compensate A for 50,000,000 VND (50% of the damage).
– Failure to Mitigate Damage. The party whose rights or interests are infringed is not entitled to compensation if the damage occurs due to their failure to take necessary and reasonable measures to prevent or limit harm to themselves.
This applies when the injured party knew or foresaw that failing to take preventive measures would result in damage, had the means to prevent or limit it, but neglected to act, thereby allowing the damage to occur.
Example: A’s house catches fire, and B parks a car near A’s house. B knows that failing to move the car could cause it to catch fire and has the means to relocate it but chooses not to, resulting in the car being destroyed. B is not entitled to compensation in this case.
