Disputes in contract performance and solutions
Disputes occur during contract performance are beyond the control of the entity entering contractual relations. In developed countries, lawyers always invited to advise customers to identify potential disputes, and provide solutions, support and provide legal advice and to accompany the enterprises solve disputes in accordance with the provisions of the law, which help businesses to focus on its business activities. The contract should be carefully reviewed by lawyers. Foreign companies when entering Vietnam mostly follow suit to engage dispute or litigation lawyers in Vietnam at early stage of the transactions.
Contractual disputes in Vietnam shall be construed as conflicts, disagreements, conflicts between the parties regarding the implementation or non-implementation of rights and obligations in the contract. Disputes could arise in failure to collect the payment from debtor in sales agreement, construction contract disputes between investor and contractor, labour dispute between employer and employee, insurance disputes between ship owner and insurance company.
Contract disputes must satisfy the following factors:
First, there is a contract between the parties. The contract would be in different for ms therefore, there is a need to clearly define if the contractual relationship has been formed or not.
Second, there is a breach of obligations or duties that are in violation of a party in the contractual relationship.
Third, there is disagreement between the parties about the handling of infringement or the consequences of such violations.
It should be noted, the contract disputes arise from the breach. However, not all breaches of contract also lead to disputes.
How to settle the contract disputes in Vietnam
Contractual disputes can be resolved by the following methods:
- Negotiation is the process or behavior in which the two sides conduct exchanges, agreement on common interests and characteristics of disagreement and come to a unified agreement. The negotiation is without the presence of third parties. However, if the lawyers in Vietnam would be involved during the negotiation process, at the role of representing or advising, counseling, then the negotiations tend to be more effective and parties would reach agreement.
- Mediation is one of the options for disputing parties to end the conflict. Mediation is different from negotiating with the intervention of a third party. Mediator will help parties to achieve agreement and resolve conflict.
- Court or arbitration: The settlement of the dispute in court would take time. The court’s ruling can be appealed. It should be noted that, per Vietnam laws, only Vietnam litigation or dispute law firms could represent the client at court. Commercial arbitration is available only in commercial-business sector. The advantage of this method is fast and efficient. However, compare with disputing at court, this method of handling dispute would take higher costs.
Disputes and dispute resolution matters are natural and inevitable in any countries including Vietnam. It is important that parties involved need to identify, anticipate disputes can occur. Contract or agreement should be reviewed by lawyers. When there is a dispute, the dispute lawyers will be able to help parties to with advice to reasonable solution to address the disputes effectively.