Disputes over a contract on borrowing properties with interest for which one party requests the to a

In 2017, Ms. M borrowed VND 200,000,000 from me under a handwritten note. The loan term was 1 year, the interest rate was 20%/year. However, when the payment is due, Ms. M did not pay me both principal and interest. Now I want to take her to the court to get my money back. However, as my understanding, the statute of limitations for initiating a civil contract dispute is 3 years and the Court will apply the statute of limitations to initiate a lawsuit if requested by Ms. M. So, should I file a lawsuit when there is a risk that Ms. M will ask for the statute of limitations?

FDVN’s Opinions:

According to Article 184 of Civil Procedure Code 2015, “2. The Courts shall apply the regulations on statute of limitations according to the requests for application of the statute of limitations of one or multiple sides, provided that such requests are made before the first-instance Courts issue the judgments/decisions on such matters/cases.” Accordingly, if Ms.M wants to ask the Court to apply the statute of limitations, she must make her request before the first-instance court issues a judgment or decision to settle the case.

Regarding the application of the statute of limitations to the dispute over the loan contract with interest:

- For the principal amount of VND 200,000,000: This is the property under your ownership, therefore according to Clause 2, Article 155 of Civil Code 2015 on the cases of Non-applicability of the statute of limitations: “Request for the protection of ownership rights, unless otherwise provided by this Code or relevant laws.”. Thus, the statute of limitations shall not be applied for the request of the principal payment.

- For interest, the statute of limitations shall be applied. The statute of limitations for interest is determined according to Article 429 of the Civil Code 2015 which is “three years from the date on which the party entitled to request knows or should know that their lawful rights and interests are infringed”.

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