Giải thích hợp đồng theo quy định của pháp luật việt nam tt tiếng anh

MINISTRY OF EDUCATION AND

MINISTRY OF JUSTICE

TRAINING
HANOI LAW UNIVERSITY

HA THI THUY
HÀ THỊ THÚY
INTERPRETATION OF CONTRACTS IN ACCORDANCE
WITH VIETNAMESE LAW REGULATIONS

Specialization: Civil Law and Civil Procedure
Code: 9 38 01 02

SUMMARY OF LAW DISSERTATION

Hanoi – 2019


The dissertation is completed at:TRƯỜNG ĐẠI HỌC LUẬT HÀ
NỘIHANOI HA HANOI LAW UNIVERSITY

Academic Supervisor:

Assoc.Prof. Dr. Bui Đang Hieu

AAGS. TS. Bùi Đăng Hiếu

Reviewer 1: Dr. Hoang Thi Thuy Hang
Reviewer 2: Assoc.Prof. Dr. Phan Huu Thu

Reviewer 3: Dr. Dinh Trung Tung

Dissertation will be examined by the Council of Dissertation
Evaluation at Hanoi Law University on

Dissertation is available at:) Thư viện Quốc gia;
1) National Library;
2) Library of Hanoi Law University.
2) Thư viện Trường Đại học Luật Hà Nội

, 2019


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A. INTRODUCTION
1. Implication of the dissertation
Interpretation of contracts is not a new regime in civil law in
general and contract law in particular. From B.C, Roman lawyers laid
the foundation for the establishment of a contract interpretation.
Studying legal concepts, establishing principles, explanatory methods
as well as explanatory bases will create a solid rationale for legislators
to consider, receive and reflect them into legislations to improve the
legal provisions on contract interpretation. However, in Vietnam today,
there is almost no scientific work to systematically study theoretical
and practical issues about the contract interpretation.
In practical terms, for many reasons the contracts may have
ambiguous, confusing, too general, or contradictory terms which
made other people hard to understand or understand in different
meanings. The contract interpretation regime is designed to provide
a legal basis for resolving disputes that occur between the parties, as

well as avoiding arbitrary discretion of the competent subject when
interpreting the contract. However, the grounds for interpreting the
contract specified in the Civil Code are not sufficient that make the
subject settle the dispute on the interpretation of contract lacking a
legal basis for resolution, leading to arbitrary discretion in applying
the law. Therefore, the study to improve the regime of contract
interpretation aims to create an objective and sufficial legal basis,
contributing to protecting the rights and legitimate interests of the
parties in the contract, promoting the develop and keeping stable for
civil exchanges.
The market economy and the globalization trend have led to an
increasing number of contracts. The requirement of interpreting the
contract is increasing, that makes the regime of contract interpretation
play an important role in keeping the contract relationship stable, and
creating a legal basis for dispute resolution.
For all those reasons, it is necessary to study the topic
"Interpretation of contracts in accordance with Vietnamese law
regulations" to meet the requirements of improving the law as well as
contributing to the theoretical and practical basis for the contract
interpretation.


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2. Research objectives and study mission
The dissertation systematized the theoretical issues of contract
interpretation, studied the status of Vietnamese law on the
interpretation of contracts and practice of the contract interpretation in
Vietnam as well as modern views on the contract interpretation in the
world. From which, the dissertation aimed to provide solutions to
improve the provisions of law on contract interpretation and improve

the effectiveness of the contract interpretation in Vietnam.
To achieve the above objectives, the dissertation needs to
fulfill the following tasks:
- Clarifying the theoretical issues of the contract interpretation.
- Studying the current legal status of the contract interpretation
and the practice of the contract interpretation in Vietnam.
- Studying the viewpoints of the contract interpretation in the
law of some typical countries in the world and the practice of
contracting and implementing contracts in Vietnam.
- Proposing recommendations on the regime of contract
interpretation in the Civil Code, amendment and supplement to the
principles and bases for the contracts interpretation as well as giving
specific recommendations to increase the effectiveness of applying
legal provisions on the contract interpretation in Vietnam.
3. Subject and Scope of the Research
Research subbjects of the dissertation including:
- Theoretical issues of contracts, interpretation of contracts,
interpretations of wills and interpretation of civil transactions;
- Regulations on the contract interpretation of the Civil Codes
through periods and some related legal documents on contract
interpretation in Vietnam, including Commercial Law and Consumer
Protection Law.
- Practice of the contract interpretation in Vietnam.
Scope of the research:
The dissertation concentrated on researching the theoretical,
legal and practical issues of interpretation of civil contracts and
commercial business contracts.


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In terms of time, the dissertation studied the provisions of
Vietnamese law on the contract interpretation in the Civil Codes from
the French colonial period to Civil Code 1995, Civil Code 2005, and
Civil Code 2015, and mainly researched the contract interpretation in
the Civil Code 2015. Regarding the practice of the contract
interpretation, the dissertation focused on the practice of contract
interpretation of competent subjects from the Civil Code 1995 comes
into effect up to now.
4. Research Methodology
The dissertation used the methodology of dialectical
materialism and historical materialism on the basis of views,
objectives and lines of the Party and the State on the issues of
economics, politics, culture and society.
The dissertation used a combination of different research
methods, including the method of researching social science and
humanities in general and the method of scientific law research for
each specific content to achieve the desired goals.
5. The new contributions of the dissertation
The dissertation was the first scientific work at the level of
doctoral dissertation studying comprehensively and systematically
the theoretical and practical issues of interpretation of civil contract
in Vietnam. The dissertation had some new contributions as follows:
The first, the dissertation systematically built the theoretical
issues of contract interpretation, including building a concept of the
contract interpretation, identifying the legal nature of the contract
interpretation and discriminating the contract interpretation with
other related activities, determining the neccesity of the contract
interpretation, the subject of the contract interpretation, the scope of
the contract interpretation, the principle of the contract interpretation
and the legal consequences of the contract interpretation.

The second, the dissertation analyzed and evaluated objectively
and comprehensively the bases of the contract interpretation in
accordance with current Vietnamese laws and practical interpretation


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of civil contract in Vietnam. Specifically, the dissertation
concentrated on analyzing the basis of the contract interpretation
comparing with the reality of the contract interpretation through a
number of typical judgments and decisions. Since then, the
dissertation pointed out inadequacies in the interpretation of contract
in Vietnamese law and offered orientations to apply the bases of the
contract interpretation in Vietnam.
The third, the dissertation analyzed both theories on the contract
interpretation in the world and modern views on the contract
interpretation of international countries.
The fourth, the dissertation also pointed out the bases of the
contract interpretation which need to be supplimented to the law on
contract interpretation of Vietnam on the basis of acquiring foreign
laws, as well as compliance with the theories and realities of the
contract interpretation in Vietnam.
The fifth, on the basis of pointing out the shortcomings that
need to be overcome in the regimes of the contract interpretation in
Vietnam, the dissertation has proposed solutions to improve the
Vietnamese law on the contract interpretation, including proposals on
the changing position of the contract interpretation regimes in Civil
Code of Vietnam, proposals on the order of application of the bases
for contract interpretation in Vietnam and proposals on constructing
the regimes of the contract interpretation in the Civil Code which
composing 16 Articles stipulating cases of interpretation of contract,

principles of contract interpretation, bases of contract interpretation
and legal consequences of uninterpretd contract cases.
The last, the dissertation proposed solutions to improve the
effectiveness of the application of law on the contract interpretation
of Vietnam, including two groups of solutions: solutions for subjects
interpreting the contract and solutions for parties in the contract.
6. Theoretical and practical meanings of the dissertation


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The first, the dissertation has a scientific contribution in
providing a system of theoretical and practical issues on the
interpretation of contracts. From which, a lawmakers have a basis to
study and reflect them into the provisions of law. At the same time, it
is also the basis for competent subjects understanding the base of
contract interpretation to effectively perform the contract
interpretation.
The second, the dissertation has a significant meaning in
completing the current contract law in Vietnam in order to meet the
requirements of the market economy in the period of globalization.
The third, the dissertation is also a reference source for lawyers
in researching, applying or teaching contract law in research, training
and teaching law institutions.
7. Structure of the dissertation
In addition to the introduction, overview of the research,
conclusion, references, the content of the dissertation consists of 4
chapters.
B. OVERVIEW OF STUDIES RELATED
TO RESEARCH TOPIC
1. Overview of studies related to the research topic

1.1. Overview of studies related to theoretical
issues of contract 1.1.1. International Researches
Contract is always one of the most important legal regimes of
the private legal system in any country. Up to now, there are a lot of
legal works researching the contracts in the world. In general, these
researches concentrated on studying a general study of contracts or
an in-depth aspect of contracts and are considered as a theoretical
foundation for the dissertation to study the contract interpretation.
1.1.2. Domestic Researches
The scientific researches on the contracts in Vietnam so far
have a very large number in comparision with other researches on
legal science. Each period of development history of contract regime
in Vietnam, there are many typical researches, especially from the
mid-90s of the twentieth century, the regime of contracts had a


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significant role, so the researches on contracts in Vietnam increased
very fast in terms of quantity and research content.
1.2. Researches on the contract interpretation
1.2.1. International Researches
Regarding the interpretation of contract, there are many
scientific researches in foreign countries, namely some typical
reseaches: monographs: “Толкование права и договора” written by
Черданщев А. Ф., Yuniti – daha, Москва, in 2003; “Введение в
cравнительное правоведение в сфере частного права”,
Международные отношения, Москва, 1998 by Konard Zweigert và
Hein Kotz, translated into Russian; “Толкование договора судом”,
проспест, Москва, 2008 of Сошуро Л. В; “Толькование
гражданско – правового договора: проблемы теории и практики.,

Научная Мысль, Москва, 2014, by Степанюк Н. В; “Elements of
contract interpretation” by Steven J. Burton, Oxford Publisher, 2009;
The Interpretation of Contracts, Lewison K., Sweet and Maxwell,
London, 2011; “Толькование договора” by Жученко С. П. In the
book
«Практика
применения
общих
положений
об
обязательствах», Status, Москва, 2011, doctoral thesis,
“Толкование договора как вид юридического толкования” by
Березина Е. А., National Law Academy Uran, Ekateburg, 2001;
Doctoral thesis “Толькование гражданско – правового договора” of
Степанюк Н. В., in 2008.
1.2.2. Domestic Researches
At the general level, there are some researches such as:
Monograph: "Vietnam 's jurisprudence law" by Dr. Vu Van Mau,
Ministry of National Education Publishing, Saigon, 1963, "Law on
contracts", National Political Publishing House, Hanoi, 1995 by Dr.
Nguyen Manh Bach; "The regime of contracts in Vietnamese Civil
Code" by author Nguyen Ngoc Khanh, Justice Publishing House,
2007; "Vietnamese contract law: judgment and commentary",
Episode 2, by Assoc. Prof. Dr. Do Van Dai, Hanoi National Political
Publishing House, 2014; textbook "Contract Law - General Part",
Hanoi National University Publishing House, 2013 by author
Assoc.Prof. Dr. Ngo Huy Cuong; textbook “Law on contracts and


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liability for compensation”, Ho Chi Minh City University of Law,
Hong Duc Publishing House, 2014.
Regarding the articles, there are: "Interpretation of civil
contracts: Foreign comparison and Article 408 of Civil Code" by Dr.
Nguyen Ngoc Khanh, Journal of Legislative Studies, No. 10/2004;
"Discussing the regime of the contract interpretation in the Draft of
Civil Code (amended)", State and Law Journal, March 2015 by two
authors Assoc.Prof. Dr. Ha Thi Mai Hien and Ma. Ha Thi Thuy; "The
regime of interpreting civil transactions in the draft of Civil Code
(amended)", by Assoc. Prof. Dr. Nguyen Quoc Suu, Electronic
Communist Review, March 23, 2015; The presentation "The regime
of contracting in the draft of Civil Code 2005 (amended)” of Dr.
Nguyen Bich Thao at the workshop "Assigning assets, obligations
and contracts in the draft of Civil Code (amended)" coordinated by
Hanoi National University.
2. Evaluate the research results of scientific researches related to
the dissertation
In international aspect, there are a number of elaborate
researches on the contract interpretation, but studying the law
regulation and practices of foreign countries. In Vietnam, there are a
lot of researches related to contract in general, but not researching the
theoretical and practical issues of the contract interpretation in
Vietnam. However, these domestic and foreign researches have
studied several aspects of teh contract interpretation in Vietnam. The
evaluation of these researches provides the author with an overview
of the research situation related to the topic, then, giving the research
orientation to the topic.
3. Research orientation of the dissertation
3.1. Issues the dissertation continues to acquire and develop
On the basis of research and evaluation of researches related to

the topic, the dissertation acquired and continued to develop the
issues: the first is the basic theory of the contract interpretation that
have been developed by scientists; the second is the theory of the
contract interpretation which was built by lawyers from the time of
Rome, such as the will theory, the doctrine of expressing will and the


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doctrine of the middle; The third is the results of researches on the
contract interpretation regime of some countries in the world; the last
is that the dissertation continued to use traditional research methods
in legal science that other scholars used.
3.2. New orientations of the dissertation
The hypothesis set out in the dissertation is: Firstly, the regime
of the contract interpretation in Civil Code 2015 has not been built on
a solid and systematic basis. Secondly, the reality of the contract
interpretation of competent subject got many difficulties, and there
have not been yet a solid legal basis due to inadequate principles and
interpretations of contracts in the Civil Code; some interpretations are
not feasible and suitable with the practice of the contract
interpretation in Vietnam.
The research orientation of the dissertation are:
Firstly, building a rationale for development of the regime of
the contract interpretation and for the interpretation of contract of the
competent subject in Vietnam.
Secondly, analyzing the principles and basis of the
interpretation of contracts in current Vietnamese laws and the
practice of the contract interpretation in Vietnam, indicating the
rational and irrational points of the principles and bases in
accordance with theoretical and verifiable basis.

Thirdly, studying the views on contract interpretation of
countries in the world to apply, study and propose some additional
interpretations of the contract on the regime of the contract
interpretation in Vietnam.
Finally, on the basis of the theoretical, practical and personal
views of the researcher, the dissertation proposes recommendations
to improve the law on contract interpretation in Vietnam and the
effect of the contract interpretation in Vietnam today.
Conclusion
The study of the contract interpretation has been concerned
and mentioned in different aspects and scopes. However, there has
not been an intensive, comprehensive and systematic research about


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theory and reality of the contract interpretation in accordance with
Vietnamese law regulations.
The study of the topic "Interpretation of contracts in
accordance with Vietnamese law regulations" is a necessary and
new scientific task on selective inheritance of research results.
C. MAIN CONTENT
CHAPTER 1: THEORETICAL ISSUES OF THE CONTRACT
INTERPRETATION
1.1. The neccessity of interpreting the contract
The neccessity of interpreting the contract appears when the
contract has unclear contents and terms. The cause of this ambiguity
may be due to subjective reasons such as the use of words (using
words with diffirent meanings, words without meaning, local words),
the expression is not clear, spelling errors in the process of
expression, or due to objective reasons such as different regional

practices, as well as due to circumstances in which contracts may
have different understandings. Because the contract contains unclear
contents and terms, the parties cannot agree on how to understand. At
this time, the interpretation of the contract is necessary to clarify the
unclear content of the contract to determine the rights and obligations
of the parties and/or responsibilities for violation of contract by each
party.
The determination of the cause of the contract interpretation as
well as the demand of the contract interpretation makes sense in
identifying principles, basis of the interpretation and the appropriate
interpretation method.
1.2. Concept of the contract interpretation
The regime of the contract interpretation appeared from
Roman times. Along with the struggle and development of legal
science fields, and the change of the purpose of the contract
interpretation, this regime has undergone many changes.
The contract interpretation is the activity of a competent
subject to clarify unclear contents and terms of the contract based on
the principles and legal grounds.
1.3. The legal nature of the contract interpretation and


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distinguish the contract interpretation with other issues
1.3.1. The legal nature of the contract interpretation
The legal nature of contract interpretation is that the subject
interprets the contents of the contract when the contract contains
unclear terms and contents to determine each party's rights and
obligations.
1.3.2. Distinguish the contract interpretation with other issues

1.3.2.1. Distinguish the contract interpretation and interpretation of
wills
Although the interpretation of the contract and the
interpretation of the will have much in common, these two activities
have a lot of differences in the nature of the interpretation, the
competent subject of the interpretation, the sequence of the
interpretation, the basis of the interpretation, as well as legal
consequences of the interpretation.
1.3.2.2. Distinguish the contract interpretation with the supplement
of the missing clause of the contract based on the law provisions
There are many opinions that the supplement of the contracts is
a contract interpretation activity. However, these two activities are
completely different in terms of reasons to interpret and reasons for
supplementing contracts; nature and basis for interpretation and
grounds for supplementing contracts.
1.3.2.3. Distinguish the contract interpretation and legal
interpretation
Many legal scientists of the Russian Federation and the UK
consider the contract interpretation as a special form of legal
interpretation. However, in Vietnam these are two completely
different activities on the competent subject, the legal consequences
of the interpretation, the purpose of the interpretation, and the basis
of the interpretation.
1.3.2.4. Distinguish the contract interpretation and contract
adjustment when circumstances change
The contract interpretation and he tcontract adjustment when
circumstances change are done by the jurisdiction, and the results of
interpretation or adjustment of the contracts are enforceable for the
parties. But these two activities differ in the reasons, the results, the

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subject, the basis and the principles of the interpretation or
adjustment of the contract.
1.4. Competent subjects interpret the contract
The contract must be interpreted when the parties to the
contract do not agree on how to understand a certain content or
clause of the contract, resulting in a dispute. So the nature of the
dispute on contract interpretation is a kind of contract dispute.
Therefore, the competent subject with the authority to interpret the
contract is the Court or the arbitration. The interpretation of the
contract by the parties themselves is not a proper interpretation
because the parties are not bound to interpret under any mandatory
process, rule, or base . As a result of this interpretation, the parties
may make new provisions for the contract, or change some terms in
the original contract.
1.5. Scope of the contract interpretation
The scope of the contract interpretation will be determined in
the following cases:
Firstly, resolving a contract dispute in which contains unclear
contents and terms leads to the parties' disagreement on how to
understand the contract. This is considered as interpreting the content
of the contract. The competent subject will have to perform the
contract interpretation even if the parties do not require an
interpretation, but the terms of the contract are unclear, and the
interpretation is necessary to resolve contract disputes.
Secondly, the contract interpretation is to determine the nature
of the contract that has been concluded, even if the contract is named
by the parties - an interpretation of the identity.
1.6. Principles of the contract interpretation

1.6.1. The principle of interpretation respects the will of the parties
rather than the words of the contract
1.6.2. The principle of interpretation must not alter the content of
the contract
1.6.3. The principle of interpretation in the direction of priority
makes the contract effectively
1.6.4. The principle of interpretation in a fair and reasonable way
1.6.5. The principle of interpretation in a way that benefits the


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contractor of a sample contract
1.7. Legal consequences of the contract interpretation
The interpretation of the contract is that the subject has the
authority to clarify the unclear content of the contract based on rules
and legal grounds. The nature of the contract interpretation is that the
competent subject is to resolve the contract dispute when the parties
in the contract cannot agree on how to understand one or some of the
contents of the contract. Therefore, the result of the contract
interpretation is a judgment or decision of the jurisdiction. The
judgment or decision of a competent subject has the mandatory value
for the parties.
Conclusion of chapter 1
Chapter 1 of the dissertation has built a system of theoretical
issues about the interpretation of the contracts to identify the contract
interpretation, distinguishing the contract interpretation with other
legal issues, determining reasons, cases, scope, subject as well as the
principles of the contract interpretation.
The research results in chapter 1 will create a basis for
researching and evaluating the provisions of law on interpretation of

contracts and a theoretical foundation for the dissertation to propose
solutions to improve the law on interpretation of contracts in
Vietnam.
CHAPTER 2: THE BASIS OF THE CONTRACT
INTERPRETATION IN ACCORDANCE WITH VIETNAMESE
LAWS AND REALITY OF THE CONTRACT
INTERPRETATION IN VIETNAM
2.1. Concept of the basis of the contract interpretation
Interpreting the contract is a work. In order to interpret the
contract, competent subjects must be used tools to interpret. It is
possible to understand that the basis of the contract interpretation are
tools or factors that the subjects use to interpret the contract. The
basis of the contract interpretation is different from the principle of
contract interpretation. If the basis of the contract interpretation is the
explanatory instrument of the competent subject, the principle of the


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contract interpretation is the way to use that tool. The regime of the
contract interpretation stipulates the bases for interpreting the
contract to create a legal basis for the competent subject to perform
the interpretation work. The interpretation principles will guide the
interpretation activities, thereby ensuring the objectivity, accuracy,
and suitablity of the interpretation.
2.2. The contract interpretation based on will and expression of
will
Viet Nam's contract interpretation regime is based on the
doctrine of middle-mindedness - the doctrine of harmony between
willpower theory and the doctrine of expressing will. Therefore, the
will and expression of will are the bases to interpret the contract. The

reality of interpreting the contract of Vietnam, the interpreting subject
still interprets the contract based on both will and expressing will.
However, clause 1 of Article 404 of the Civil Code 2015, when
providing this interpretation base, still exists some shortcomings:
Firstly, the way specified in Clause 1, Article 404 of the Civil Code
2015, leads to the interpretation by the subject when the award is
appropriate. It is difficult to distinguish the common will of the
parties in the contract as a basis to interpret the contract or the
purpose of the contract interpretation. Secondly, Item 1, Article 404
of the Civil Code does not specify the expression of will will also be
a basis for interpretation of the contract.
2.3. The contract interpretation based on purpose and nature of
the contract
According to Vietnamese lawmakers, "The purpose of a
contract is legitimate interests which the parties wish to achieve at
the time when they enter into a contract." (Article 118 Civil Code
2015). The purpose of the contract is always a legal issue. The
purpose of the contract is different from the motive of the contract.
Nature of the contract is the internal characteristics of the
contract to distinguish this contract with another.
The purpose and nature of the contract are basis for
interpretation of the contract. In reality of the contract interpretation ,
the purpose of the contract is considered as a basis for interpreting


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the content of the contract. Meanwhile, the nature of the contract is
considered as a basis for interpreting the contract identifier.
2.4. The contract interpretation based on will of parties before
entering a contract (pre-contract information)

Pre-contract period is the period starting from the time a party
makes a negotiated offer. Paragraph 1, Article 404 of Civil Code
2015 allows the use of all acts containing the will of the parties
before entering a contract as a basis for interpretation of the contract.
In the process of applying the pre-contract information, the
competent subjects of the contract interpretation are only focus on
information showing their final will during the negotiation process of
the contract. In the process of interpreting the contract, one or more
parties have the right to cite the pre-contract information as a basis
for interpreting the contract. However, which party citing, they must
prove that it is the final will of parties. If the general will of the
parties cannot be determined, the party citing the pre-contract
information needs to prove that with such information how an
ordinary person in the same situation understand to determine the
content of the contract.
2.5. The contract interpretation based on customs
Not all customs are considered a source of law and are used as
a basis for interpretation of contracts. A custom to be considered as a
basis for interpreting a contract if it satisfies the following conditions:
Firstly, customs must have clear content to clarify the unclear content
of the contract. Secondly, customs must be formed and repeated
many times in a long period. Thirdly, customs must be recognized
and widely applied in a community of people or a civil field.
Fourthly, customs is not contrary to the basic principles of civil law.
Customs is differ from manner, habit, and behavior. Current
Vietnamese law only states that customs is a basis for interpreting
contracts without recognizing habits (or practices), manner, or
behavior to interpret contracts. However, in the trial practice of the
Court, the Court still leads the practice as a basis to interpret the
contract.

If there is a conflict between different types of customs, a


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common customs, or customs that the parties know or are forced to
know in the smallest area is used to interpret contracts to create equality
between the ethnic groups as well as localities and also to ensure the
principle of goodwill of law on contrac. If there is a contradiction
between parties, the custom at the place of contract signing will be used
as a basis for interpretation of the contract. Contracting place is the place
of residence or office of the party who made the first contract proposal,
unless otherwise agreed by the parties.
2.6. The contract interpretation based on correlation between the
terms of the contract.
It is reasonable to interpret contracts based on the correlation
between the terms of the contract, due to the systematic nature of the
contract. And the fact of contract interpretation in the Court is not
uncommon in case the Court interprets the contract based on the
relationship between the terms of the contract to interpret.
In principle, the terms of the contract all have the same role in
the contract, regardless of the order in which they appear in the
contract, unless the parties agree on that priority hierarchy in the
contract. Therefore there is no priority order in determining the terms
used as a basis for the contract interpretation. However, the use of
interpretation bases needs to be in conformity with the principles of
contract interpretation, and usually the specific provisions are
preferred over the general nature of the terms.
If there is a contradiction between the amendment and addition
of the contract, the interpretation rule is that the legal contract
showing the final will of the parties will be prioritized for use as a

basis of interpreting the contract.
2.7. The contract interpretation based on interests of the party in
a weak position
In the interpretation of the contract, Vietnamese law is based
on the interpretation in favor of the party accepting the contract
according to the form in Clause 6 of Article 404 of Civil Code 2015.
The reality of interpretation of contracts in Vietnam is not difficult to
find ruling to interpret the contract in a way that benefits the party in
a weak position. However, the provisions on interpretation of


16
contracts based on the interests of the party in a weak position still
exist some unreasonable points: Firstly, Civil Code 2015 uses the
term "editor" is unreasonable. Secondly, there is a contradiction
between Clause 6 of Article 404 and Clause 3 of Article 405, Clause
3 of Article 406 of Civil Code 2015. Thirdly, Civil Code 2015 has not
yet provided a way to interpret the contract in the case of a contract
using a sample term which conflicts with the terms negotiated by the
parties themselves. Finally, the practice of interpreting the current
contract in court, the scope of the party in a weak position is
determined quite broadly, not only includes the party accepting the
model contract but also the buyer in the contract, insurance buyers in
insurance contracts, consumers in consumer contracts, etc.
Conclusion of Chapter 2
Chapter 2 of the dissertation analyzed and evaluated
objectively and comprehensively the current legal regulations on
interpretation of contracts and practices of contract interpretation in
Vietnam to point out reasonable and unreasonable points of law on
contract interpretation in Vietnam today.

The research results in Chapter 2 showed that the law on
interpretation of contracts under Civil Code 2015 has more
progressive points than Civil Code 2005 but there are still many
unreasonable points. These research results are the basis for the
author to propose some solutions to improve the law on contract
interpretation in Vietnam.
CHAPTER 3: MODERN VIEWPOINTS ON THE BASIS OF
INTERPRETATION OF CONTRACTS AND THE
SUPPLEMENT SOME BASES OF CONTRACT
INTERPRETATION INTO VIETNAMESE LAW
3.1. Modern viewpoints on the basis of contract interpretation are
used by some countries
Laws of countries have two tendencies to build a regime of
contract interpretation: under an objective point of view and a subjective
point of view. The tendency of a subjective point of view interprets
contract base on the true common will of the parties in the contract. The


17
objective trend interprets the contract base on the understanding of an
ordinary person in the same situation as the parties in the contract are
interpreted. However, currently laws of these countries have a
combination of subjective and objective interpretations trend.
3.2. The necessity of supplement the bases of contract
interpretation
The necessity of supplement the basis for interpretation of
contracts starts from the following reasons: Firstly, the grounds for
interpreting contracts under current law are incomplete. Secondly, in
many cases, the interpretation of the competent subject is lack of a
legal basis due to a lack of interpreting grounds. Thirdly, the contract

base list is a closed list so the competent subject does not promote
activeness. Meanwhile, the demand for interpretation of contracts is
increasing with the increase in the number of contracts signed and the
complexity of these contracts.
3.3. The bases for interpretation of contracts may be considered
and supplemented into the legal regime on contract
interpretation of Vietnam
3.3.1. Interpretation of contracts based on actual circumstances at
the time of contract signing
The supplement of a basis for interpreting contract comes from
the fact that each contract always exists in connection with a certain
situation. Based on the actual circumstances at the time of entering
into and performing the contract, it is possible to determine the will
of the parties in that contract. On the other hand, court practice when
interpreting contracts is also often based on actual circumstances at
the time of contract conclusion, but this interpretation has no legal
basis. Laws of a country in the world also stipulate the interpretation
of contracts based on these external factors.
3.3.2. Interpretation of contracts based on bahavior of parties after
contracting
Behavior of a party is an expression of the party's will to the
content of the contract. Therefore, the law of many countries around
the world stipulating the conduct of the parties after the contract is
concluded is the basis for explanation of the contract. The behavior


18
of the parties after the contract is used as a basis for explanation of
the contract may be the behavior expressed in the form of actions, for
example tax payment or declaration of procedures. receiving land use

rights, acts of establishing transactions related to property are subject
to the contract, ... but can also be expressed in the form of inaction,
for example acts against objectionable use by the other party use of
property, no objection to the other party's tax payment or declaration
of procedures for registration of ownership of property, etc.
3.3.3. Interpretation of contracts based on habits formed between
the parties
Civil Code 2015 does not recognize the habit formed between the
parties as a basis for interpretation of a contract. However, laws of many
countries recognize the habit formed between the parties as a basis for
interpretation of the contract, for example the Russian Federal Civil
Code or the UNIDROIT Code of Conduct on international trade
contracts. In fact in Vietnam, the court used the habit formed between
the parties to interpret the contract. However, the application of the basis
for interpreting this contract has no legal basis.
The habit to be used as a basis for interpretation of contracts
must meet the following conditions: First, the habit must be a clear
and existent rule. Second, the habit must be formed on the basis of
the consent of the parties in the same type of contract. Third, the
habits must be repeated for a long period between parties in previous
contracts. Fourth, that habit must not be contrary to the basic
principles of Civil Code.
Conclusion of Chapter 3
Chapter 3 of the dissertation studied two different viewpoints
on the contract interpretation are subjective and objective viewpoints,
assessing the pros and cons of each point of view to determine the
point of interpretation of contracts in Vietnam.
It is necessary to add the bases to interpret the contract to the
contract interpretation regime. Chapter 3 suggests the bases for
interpretation of contracts may be added to Vietnamese contract

interpretation regime.
CHAPTER 4: RECOMMENDATIONS TO IMPROVE


19
VIETNAMESE LAW ON CONTRACT INTERPRETATION
AND THE EFFICIENCY OF APPLICATION OF LAW ON
CONTRACT INTERPRETATION
4.1. Inadequacies need to be overcome in Vietnamese contract
interpretation regime
Firstly, inadequacies of the correlation between the general
provisions on interpretation of civil transaction and specific
provisions on contract interpretation.
Secondly, Civil Code 2015 stipulates cases of interpretations
corresponding to explanatory grounds that lead to duplication and
problems of determining the priority order of bases.
Thirdly, Civil Code 2015 has not yet made clear the principles
of contract interpretation
Fourthly, the bases for contract interpretation listed in Civil
Code are still incomplete
Fifthly, the provisions on interpretation of contracts in the
direction of disadvantage for the drafting party are not reasonable
Sixthly, it has not solved the problem of determining the
priority order to apply the bases for interpretation of contracts
Seventh, it is necessary to interpret the contract when the
words and expressions are clear or not.
Eightly, there are no legal consequences of uninterpreted
contracts.
4.2. Proposals on the arrangement of contract interpretation in
Civil Code

The regime of contract interpretation should be arranged into
two specified groups, the first is the general provisions in the law on
interpretation of civil transactions, the second is specific provisions
in the General provisions of contracts. In order to complete the
regime of contract interpretation, it is necessary to arrange the
contract interpretation regime into a subsection in Section 7, Chapter
XV, the General Regulations in Part Three of Obligations and
Contracts to specifies the competent subject has an authority to
interpret contracts, principles and basis for interpretation of contracts.
This subsection is arranged immediately after the sub-section on


20
contracting.
When interpreting contracts, the group of subjective basis
should be prioritized first, then to the objective base group and finally
the internal base group of the contract. However, this division is only
relative. Therefore, for each base of the contract interpretation, the
competent subject need to consider all relevant evidence and facts.
Each evidence should be considered in an assessment that is
consistent with the various grounds of contract interpretation to find a
reasonable interpretation for the contract interpretation dispute.
4.3. Specific recommendations to improve Civil Code 2015
provisions on the contract interpretation
Subsection … - Interpretation of contracts
Article 404.1 – Interpretation of contracts
When the contract contains unclear or conflicting contents
that the parties cannot agree on understanding the contract, it is
necessary to interpret the contract.
The interpretation of the contract must be based on the

grounds set forth from Articles 404.3 to 404.15 of this Code and
other relevant regulations.
Article 404.2 – Competent subject of interpretation of contracts
The competent subject to interpret the contract is a court or
commercial arbitration.
Article 404.3 – Principles of interpretation of contracts
If the contract has unclear contents or terms, the interpretation
of contract must be based on the common will of the parties rather
than the literal meaning of the words and expressions.
Do not interpret the contract to distort the content of the
contract that has been concluded between the parties.
Terms of the contract must be interpreted to make all
provisions have more effective than making one or more terms of the
contract ineffective.
In case the contract is prepared in multiple versions, each
version is in a different language, and these versions are equal
validity, the interpretation based on the original version is prioritized.
Article 404.4 - Interpretation of contracts based on common
will of parties
The contract must first be interpreted based on the true


21
common will of the parties.
If there is a conflict between the mutual will of the parties and
words and expressions of the contract, the contract must be
interpreted based on the true common will of the parties.
Article 404.5 - Interpretation of contracts based on precontract information
When interpreting contracts, it is necessary to base on precontract exchange information, including exchange letters, results of
preliminary negotiations, and other similar evidences.

Article 404.6 - Interpretation of contracts based on behavior
of the parties in implimenting contract
The contract should be interpreted in accordance with the
behavior of the parties in the process of contract performance.
Article 404.7 - Interpretation of contracts based on habits
formed between the parties
If there is a habit formed between the parties, the interpretation
of the contract is based on those habits.
Article 404.8 - Interpretation of contracts based on customs
The contract can be interpreted based on the custom at the
contracting place.
Article 404.9 - Interpretation of contracts based on actual
circumstances at the time of contracting
The contract is interpreted in accordance with the actual
circumstances at the time of contracting.
Article 404.10 - Interpretation of contracts based on other
provisions of the contract
Terms of the contract must be interpreted in relation to each other,
and be consistent with the content and meaning of the entire contract.
If there is a contradiction between the main contract and the
amendments and supplements to the contract, the contract is interpreted
according to the meaning of the contract amendment and supplement.
Article 404.11 - Interpretation of contracts based on legal
purpose and legal nature of the contract
When interpreting a contract, it must be based on the legal
purpose and legal nature of the contract
Article 404.12 - Interpretation of contracts based on the


22

usual meaning of words and expressions used in contracts
The contract is interpreted based on the usual meaning of
words and expressions used by the parties in the contract.
Article 404.13 - Interpretation of contracts based on the
nature of the model contract and general transaction conditions
In case of a model contract, general transaction conditions with
unclear content or terms, the interpretation must be in a direction that
is detrimental to the party making the model contract and general
transaction conditions.
Article 404.14 - Interpretation of contracts based on
international practice
International trade contracts are interpreted based on
international practices.
Article 404.15 – Other bases on interpretation of contracts
One or more parties may cite the grounds for interpreting other
contracts but the party must prove that is the common will of the parties.
Article 404.16 - Resolving consequences in case the contract
cannot be interpreted
1. In case the contracts are not interpreted:
a) If the uninterpreted clause is a basic clause, the contract is
not yet concluded;
b) If the uninterpreted clause is a non-basic clause, the
corresponding provisions of law apply.
2. Subjects with errors that make the contract unexplainable
must compensate for damage, if any.
Determining the subject with an error that makes the contract
unexplainable is defined as follows:
a) If the contract cannot be explained as a mutual agreement,
each party has the same error;
b) If the unexplained contract is a model contract, the contractgiving party is the one with the error.

Abandoning paragraph 2 of Article 405 on explanation of
model contracts because this content has been stipulated in Article
404 on explanation of contracts.
Supplement regulations on the interpretation of general trading


23
conditions in the direction of disadvantage for the party that gives
general trading conditions, which are beneficial for the counterparty.
In addition, it is necessary to supplement the case when the general
transaction conditions and terms agreed by the parties must be based
on the terms agreed by the parties to explain the contract.
4.4. Solutions to improve the effectiveness of the application of
legal provisions on the contract interpretation
4.4.1. For the interpreting subject
- Combining methods of interpretation;
- Applying accurate and reasonable bases and explanatory
principles;
- Actively and flexibly applying the interpretation bases;
- Only considering the facts without distorting the content of the
contract.
4.4.2. For the parties in the contract
- Drafting the contract clearly.
- Interpreting contract in case of using unclear terms
- Improving legal knowledge
- Regulating the grounds for interpretation for their own
contracts.
- Keeping and providing evidence and prove in accordance with
legal basis.
Conclusion of chapter 4

On the basis of analyzing the inadequacies of Vietnamese law
on contract interpretation, Chapter 4 of the dissertation has proposed
solutions to improve Vietnamese law on contract interpretation in
terms of location, structure and content of relevant legal provisions in
Civil Code.
However, the interpretation of contract requires the initiative
and flexibility of the subject in the interpretation process. Therefore,
the interpretation subject needs to apply properly and flexibly, and
combine methods of interpretations as well as interpretation
principles.
D. CONCLUSION OF THE DISSERTATION