INTERNATIONAL UNIVERSITY

SCHOOL OF BUSINESS

WRITTEN COURSEWORK
Module code: BA081UI
Module name: Business Law.

Student’s name: Đặng Nguyễn Minh Thư

Student ID: BABAIU19333

Question:

On 31st January 2019, Thuan An people’s court issued Decision no.

03/2019/QĐST-KDTM recognising the agreement made by JP Ltd. Company and VQ
Company. Under the agreement, JP Ltd. Company must pay VQ Company
2.350.547.614 dong and interests for the late payment. On 9 th April 2019, Thuan An
Department of Civil Enforcement issued Decision no. 1461/QĐ-CCTHADS to enforce
the Decision no. 03/2019/QĐST-KDTM. JP Ltd. Company paid off 865.500.000 dong.
However, as JP Ltd. Company has stopped performaning its obligation of payment,
on 11th November 2019, Thuan An Department of Civil Enforcement issued Decision
no. 04/QĐ-CCTHADS to destraint and dispose property of JP Ltd. Company.
From June 2019 until now, JP Ltd. Company has not paid any more money for VQ
Company (more than 3 months). As a result, VQ Company submitted a request for
bankruptcy.
In July 2019, Binh Duong people’s court issued Decision no. 01/2020/QĐ-KMTTPS
refusing to initiate a bankruptcy process for JP Ltd. Company. At this Decision, Binh
Duong people’s court invoked the article 9, 42 and 44 in the law on bankruptcy 2014
to explain its refusal. In particular, Binh Duong people’s court believed that JP Ltd.
Company has not fallen in an insolvent situation, because JP Ltd. Company still has
(1) the land use rights of 11.999,9 m2 lot in the Vietnam – Singapore Industrial Park
which was certified by the certification no. 79/QSDĐ/2003 on 21 st March 2003, and
(2) the land use rights of lot no.159 in the Guocoland project which was certified by
the certification no. BK075016 on 10 th January 2013. Besides, when JP Ltd. Company
failed to pay VQ Company 1.455.047.614 dong and interest of the late payment,
Thuan An Department of Civil Enforcement issued Decision no. 04/QĐ-CCTHADS to
destraint and dispose its (JP Ltd. Company) property.
Criticise Decision no. 01/2020/QĐ-KMTTPS of Binh Duong People’s court in
compliance with the law on enterprises 2020, and the law on bankruptcy 2014.

Word count:
I. Introduction
The legal issue in this case is to define whether Decision no. 01/2020/QĐ-KMTTPS of
Binh Duong People’s court compliance with the law on enterprises 2020, and the law
on bankruptcy 2014 or not.
In order to define, we should apply the law on bankruptcy 2014, including Clause 1
Article 4, Clause 2 Article 42 and Clause 1 Article 5.
II. Body
In July 2020, Binh Duong people’s court issued Decision no. 01/2020/QĐ-KMTTPS
refusing to initiate a bankruptcy process for JP Ltd. Company. Binh Duong believed
that JP Ltd. Company has not fallen into an insolvent situation because they still own
land property, including (1) the land use rights of 11.999,9 m2 lot in the Vietnam –
Singapore Industrial Park which was certified by the certification no. 79/QSDĐ/2003
on 21st March 2003, and (2) the land use rights of lot no.159 in the Guocoland project
which was certified by the certification no. BK075016 on 10 th January 2013.
According to Clause 1 Article 4, Insolvent enterprise or cooperative means an
enterprise or a cooperative that fails to perform the obligation to pay its debts within
3 months after such debts become due.
It means that although the enterprise or a cooperative still has property to pay, the
failure to pay the debt before due is still considered as insolvency. In fact, JP Ltd.
Company failed to perform the obligation to pay it for VQ Company within 3 months,
so JP Ltd. Company can be considered to fall insolvent.
According to Clause 2 Article 42, Judges shall issue decisions to initiate bankruptcy
procedures when enterprises or cooperatives fall insolvent.
In conclusion, Judges shall issue decisions to initiate bankruptcy procedures for JP
Ltd. Company, which is considered to be an insolvent enterprise.
In addition, Thuan An Department of Civil Enforcement issued Decision no. 04/QĐ-
CCTHADS to restrain and dispose its (JP Ltd. Company) property when JP
Ltd.Company failed to pay VQ Company 1.455.047.614 dong and interest of the late
payment. As a result, Binh Duong people’s court argued that JP Ltd.Company had
finished paying its debt to VQ Company and had not fallen into an insolvent
situation.
According to Clause 1 Article 5, Unsecured creditors and partially secured creditors
may file petitions for initiation of bankruptcy procedures in case indebted enterprises
or cooperatives fail to perform the obligation to pay debts within 3 months after such
debts become due.
Because Thuan An Department of Civil Enforcement issued Decision no. 04/QĐ-
CCTHADS to destraint and dispose its (JP Ltd. Company) property and VQ could
submit a request for bankruptcy, VQ Company is a partially secured creditor.
Therefore, Decision no. 04/QĐ-CCTHADS of Thuan An Department of Civil
Enforcement issued Decision no. 04/QĐ-CCTHADS to restrain and dispose JP Ltd.
Company means that JP Ltd. Company is still in debt. As the debt had not been paid
within 3 months, JP Ltd. Company can be considered to fall insolvent.
III. Conclusion
To sum up, the decision no. 01/2020/QĐ-KMTTPS of Binh Duong People’s court to
refuse to initiate the bankruptcy process for JP Ltd. Company is not in compliance
with the law on bankruptcy 2014.
To ensure the rights and obligations of people and enterprises, Judges must hold
accountable for their wrong decisions and damages that the parties have suffered.

Referencing