Can the court impose freezing of assets that have been transferred to a third party?

My mother participated in a “ho” transaction with Ms. A and Ms. A was the dealer. One day, Ms. A didn’t pay “ho” to my mother and other people, although she owns some assets. My mother the the others filed a lawsuit to the competent court and the file was accepted. As far as we concerned, Ms. A sold her land-use rights to another one and has just conducted the contract notarization. Then, my mother and the others filed a request on freezing Ms. A’s assets to the court. I would like to know if my mother’s request would be accepted. Thank you.

FDVN Opinion

According to Article 126 of Civil Procedure Code 2015, “Freezing the obligors' properties shall be applied if in the course of settling cases there are grounds showing that the obligors have such properties and the application of this measure is necessary to ensure the settlement of the cases or to ensure the judgment enforcement.”.

According to Clause 3, Article 188 of Law on Land 2013, “The exchange, transfer, lease, sublease, inheritance, donation or mortgage of land use rights or contribution of land use rights as capital must be registered with the land registration agency and will take effect from the time of registration in the cadastral book.”

Thus, if Ms. A signed the contract of transferring land-use right; the contract was notarized and Ms. A completes the registration in the cadastral book, the land parcel was not under Ms. A's use rights. The Court was not allowed to apply provisional emergency measures to temporarily freeze the assets of the obligor. If the contract of transferring the land-use rights has been signed and the contract has been notarized but has not yet been registered in the cadastral book, the land parcel was still under Ms. A's use rights. The Court may apply provisional emergency measures to temporarily freeze the assets of the obligor under the provisions of the Civil Procedure Code 2015.

Thus, based on the transfer of the asset ownership at the time of considering the petition, the Court may issue a decision to apply the freezing measure or refuse in writing with a detailed explanation under Point a, Clause 2, Article 133 of Civil Procedure Code 2015.

Hoàng Thúy Quỳnh – FDVN Law Firm

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