Compensation for damage caused by construction works

I. Details of the incident

Mr. Tuan is the investor of a construction project in Thu Duc City, Ho Chi Minh City. During the construction process, serious cracks and subsidence occurred in Mr. Hong’s adjacent house.

In August 2020, the two parties reached a settlement agreement. Mr. Tuan committed to sending workers to repair Mr. Hong’s house as requested, in the presence of Mr. Hong’s family and under Mr. Tuan’s supervision. The repairs would be carried out after Mr. Tuan’s house was completed in its rough construction phase.

In November 2020, the parties continued working together. Mr. Hong’s family requested that Mr. Tuan fill in the excavated area that affected the foundation and basement of the house to ensure safety until repairs could be carried out, and demanded 800,000,000 VND in compensation to hire a construction company to rectify the situation, to be paid in cash within 10 days. However, Mr. Tuan did not agree.

Construction site accidents

On November 16, 2020, the parties continued working together but could not agree on the compensation amount. Both sides then requested the People’s Committee to invite a consulting firm to determine the extent of the damage.

Seeing his rights violated and suffering property damage, while the project developer was unwilling to resolve the issue, Mr. Hong requested Inter Justice lawyers to advise on options and participate in protecting his rights in court.

In December 2020, Mr. Hong filed a lawsuit against Mr. Tuan in court with the following claim:

• Mr. Tuan is obligated to compensate Mr. Hong’s family for the cost of repairing the house and rectifying the damage caused by his construction work, with the amount of 800,000,000 VND (eight hundred million Vietnamese dong).

In March 2021, the defendant’s representative stated:

• Mr. Hong’s lawsuit has no legal basis because:
• Mr. Tuan’s commitment to compensating Mr. Hong’s family for the damages is true.
• Mr. Tuan sent seven skilled workers to Mr. Hong’s house to repair the cracks, but Mr. Hong still claims that Mr. Tuan has not done the work, which is a dishonest and deceitful act.
• Mr. Hong is required to provide evidence to support his claim for 800 million VND in compensation.

In April 2021, the Court issued a decision requesting an expert assessment to determine the cause of the damage, the remedial measures, repair costs, and the extent of damage to Mr. Hong’s property.

The inspection results conclude that the damage and tilting of house number 8 on street 8 are due to the reasons analyzed above, resulting in several cracks with shapes consistent with the influence of the new construction. The impact of the new construction at number 6 on street 8 is the primary cause of the damage and exacerbates the existing damage to the building.

The proposed cost estimate for repairing the damage is 800,000,000 VND.

II. Legal regulations related to the matter

The 2015 Civil Code stipulates:

Article 589. Damages caused by infringement of property rights.

Damages resulting from property infringement include:

1. Property that is lost, destroyed, or damaged.

2. Reasonable costs to prevent, mitigate, and remedy the damage.

Article 605. Compensation for damage caused by houses and other construction works.

Owners, possessors, and those entrusted with the management and use of houses and other construction works must compensate for damages caused to others by those houses and other construction works.

When a contractor is at fault for causing damage to houses or other construction works, they must be jointly liable for compensation.

Article 119 of the 2014 Construction Law stipulates:

Article 119. Construction accidents

4. Organizations and individuals causing construction incidents are responsible for compensating for damages and bearing related costs, and will be subject to administrative penalties; individuals may be prosecuted criminally in accordance with the law.

Article 94. Sources of evidence

Evidence was gathered from the following sources:

5. Conclusion of the expert assessment.

III. Lawyer’s proposed approach to handling the case

• The lawyer advised Mr. Hong to file a lawsuit compelling Mr. Tuan to compensate for the cost of repairing the house and rectifying the damage caused by Mr. Tuan’s construction work to Mr. Hong’s family, amounting to 800,000,000 VND.
• The lawyer asserted that the expert assessment commissioned by the Court was legitimate evidence proving that the construction of Mr. Tuan’s house was the primary cause of the cracks and subsidence in Mr. Hong’s house; and that 800,000,000 VND was the necessary cost for repairs as estimated in the expert assessment.
• Mr. Tuan was the investor in the construction of his house; therefore, based on the provisions of the Civil Code and the Construction Law, Mr. Tuan must compensate Mr. Hong for damages in the amount of 800,000,000 VND. We request that the Court accept all of Mr. Hong’s claims.

IV. Court Judgment

• Based on the lawyer’s analysis and expert evidence, along with the provisions of the Civil Procedure Code and the Construction Law, the Court accepted Mr. Hong’s entire claim, ordering Mr. Tuan to compensate Mr. Hong’s family for the cost of repairing the house and rectifying the damage caused by Mr. Tuan’s construction project, amounting to 800,000,000 VND.