General regulations on compensation for non-contractual damages
Compensation for non-contractual damage is a legal liability that forces a person to compensate for damages even though it is not bound by the contract. This is a case in which an organization or individual infringes and causes damage to life, health, honor, dignity, reputation, property, rights and other legitimate interests of another person or in case the property they own causes damage. In the article below, TNTP will present the general provisions of the law on compensation for non-contractual damages.
1. Grounds for compensation for damage
Liability for compensation for damage arises in the following cases:
• Individuals and organizations that cause damage to others when committing acts of infringing upon life, health, honor, dignity, reputation, property, rights and other legitimate interests of others shall be liable to compensate for damages.
Based on Article 2 of Resolution 02/2022/NQ-HDTP, individuals and organizations will be responsible for compensation for non-contractual damage when there are the following factors:
– Committing acts of infringing upon life, health, honor, dignity, reputation, property, rights and other legitimate interests of others;
– There is material damage or mental damage;
– There is a causal relationship between the damages caused and the infringement.
• Individuals and organizations that own or possess property shall be liable for compensation when that property causes damage to others.
Regarding the exemption from compensating non-contractual damage, just like other legal liabilities, unless otherwise agreed upon or otherwise provided for by law, organizations and individuals will be exempted from compensating non-contractual damage when:
• The damage is caused by a force majeure event; or
• The damage is caused entirely due to the fault of the injured party.
Thus, liability to compensate for non-contractual damages arises when individuals and organizations infringe upon the rights and interests protected by law of others even though those rights and interests are outside the contractual agreement.
2. Principles of compensation for non-contractual damages
Compensation for non-contractual damage must be carried out with the following principles:
• Fully and timely compensation: The damages must be fully and promptly compensated so that the victim can quickly remedy and minimize the impact of the act causing damage. The compensation must be timely so that the injured party does not have to suffer other indirect losses due to the delay in compensation.
• Considering reducing the compensation level if there is no fault or there is an unintentional fault and the damage is too large compared to the economic capacity: For example, for the case of unintentionally causing too large damage while the person responsible for compensation does not have enough personal property to compensate and the average income is low. At that time, the person causing damage will be considered to reduce the compensation level because it is considered unintentionally causing damage and the compensation level is too large compared to economic capacity.
• The compensation level must be suitable with reality: In some cases where the compensation level is no longer suitable to reality, the injured party or the party causing the damage has the right to request the Court or other competent state agencies to change the compensation level.
• The injured party shall not be compensated if it is at fault for causing damage: When the injured party is at fault for causing damage, it shall not be entitled to compensation for the damage caused by its fault.
• The injured party shall not be compensated if it is aware and meets the conditions but fails to prevent and limit the damage: The party whose rights and interests are infringed shall not be compensated if the damage occurs due to the failure to apply necessary and reasonable measures to prevent and limit the damage to themselves.
• Voluntariness, equality, goodwill, and honesty: Compensation can be based on an agreement between the two parties, in the spirit of goodwill and honesty. This encourages the parties to negotiate and reach a consensus on the level, type and method of compensation instead of having to have a protracted dispute.
3. Types of compensation and methods of compensation for non-contractual damages
• Types of compensation for non-contractual damages:
– Compensation in money or property of equivalent value to recover property damages.
– Compensation for expenses necessary to remedy the consequences or restore the health and working capacity of the injured party.
– In case of mental damage, the party causing the damage may have to pay compensation in a sum of money according to the agreed level or as prescribed by law.
• Compensation method
– The parties may agree on the method and time limit for compensation for damages. In case of failure to reach an agreement, the injured party has the right to request the court to settle.
– Compensation can be made in one lump sum or divided into several installments by agreement of the parties or a court ruling.
We note that: The party causing the damage may be exempted from liability if there are grounds to determine that the damage was caused by a force majeure event, the fault of the injured party, or the injured party agrees to the risk.
4. Statute of limitations for initiating a lawsuit for compensation for damages
The statute of limitations for initiating a lawsuit for compensation for damage is 03 years from the date the person who has the right to request knows or should have know that his/her legitimate rights and interests have been infringed. To determine the time to start calculating the statute of limitations for initiating a lawsuit for compensation for damages, Article 5 of Resolution 02/2022/NQ-HDTP has stipulated as follows:
• The time when persons with the right to request to know their legitimate rights and interests are infringed upon is when they realize or can affirm that their legitimate rights and interests are infringed.
• In case the person who has the right to request to know that his/her legitimate rights and interests are infringed upon under normal conditions and circumstances, if any damage occurs, such person shall know that his/her lawful rights and interests are infringed upon or in case the law provides for knowing.
Thus, from the above time, within 03 years, the victim has the right to initiate a lawsuit at a competent People’s Court to claim compensation for damages.
Above is the content of the article “General regulations on compensation for non-contractual damages” that TNTP sends to readers. Hope the article is useful for those who are interested in this issue.
Best regards,