Intentionally asking customers to receive the house?
Accordingly, on June 13, 2023, Tan Phu District People's Court held a meeting to examine the submission, access, disclosure of evidence and mediation between Mr. TSH - a customer who bought an apartment at Apartment Building A5, belonging to Tan Thang Sports Complex and Residential Area (Celadon City Project, Son Ky Ward, Tan Phu District, Ho Chi Minh City) of the investor Gamuda Land Joint Stock Company (Gamuda Land).
At this meeting, Mr. TSH requested the investor Gamuda Land to provide full legal documents for the apartment, including the acceptance report, and to be eligible for use. At the same time, the investor must fix technical errors, defects of the apartment and unreasonable parking fees. In addition, Gamuda Land must resolve the rights of customers due to the delay in handing over the house. The penalty interest is 18%/year as stipulated in the contract.
In response to Mr. TSH's request, Gamuda Land's representative requested that the customer receive the house according to the sales contract signed by both parties. Gamuda Land will fix the defects that Mr. TSH requested.
Speaking to the Journalist and Public Opinion Newspaper, Mr. TSH expressed his concerns about Gamuda Land's request to receive the house at court. Because previously on June 1, the Ho Chi Minh City Department of Construction had sent Document No. 7764/SXD-TT to the Tan Phu District People's Committee to prevent the handover of apartments to residents for use without organizing acceptance according to regulations.
Gamuda Land still asks customers to receive their houses even though the authorities have requested to stop handing over the apartments.
The content of this document clearly states that the Ho Chi Minh City Department of Construction has issued a report No. 7356/TTr-SXD-TT dated May 24 and Official Dispatch No. 7528/SXD-TT dated May 29, requesting the Chairman of the Ho Chi Minh City People's Committee to sign and issue a decision to sanction administrative violations in real estate business activities against Gamuda Land. The reason for the sanction is because this investor has handed over houses and construction works to customers without having a document approving the acceptance results of the competent authority to put the housing project and social infrastructure project into use according to regulations.
At the same time, in a recent meeting with the group of customers buying houses at A5 Apartment Complex, the People's Committee of Son Ky Ward said that it had received an urgent dispatch from Tan Phu District to prevent Gamuda Land from handing over apartments. Immediately after that, on June 12, the People's Committee of Son Ky Ward coordinated with the Police and the Urban Management Department of Tan Phu District to organize a meeting with Gamuda Land to request that this investor comply with the content of the Department of Construction's dispatch requesting to prevent handing over apartments.
However, just one day later, at the Tan Phu District People's Court, Gamuda Land still asked Mr. TSH to receive the house to resolve the dispute. This is a puzzling request, because up to now, Gamuda Land has not provided the results of the project acceptance and the document approving the project to be put into use.
Can be fined up to 1 billion VND
The investor's handover of the apartment without the approval of the competent authority to put the project into use violated Clause 4, Article 58 of Decree 16/2022/ND-CP on violations of regulations on real estate business.
Specifically, according to Point d Clause 4 Article 58 clearly stipulates that investors can be fined from 800 million to 1 billion VND if they hand over houses and construction works to customers when they have not completed the investment in construction of houses, construction works and technical infrastructure works, social infrastructure works according to the progress recorded in the approved project, have not ensured connection with the common infrastructure system of the area, have not completed the entire exterior (in the case of handing over houses and rough construction works) or have not completed the acceptance or have not received a document approving the acceptance results from the competent authority to put the housing works and social infrastructure works into use according to regulations.
Many customers who bought houses in the Diamond Alnata subdivision of the A5 Apartment Complex of Celadon City are extremely upset with the investor's failure to properly implement the penalty decision of the Ho Chi Minh City People's Committee and resolve the customers' rights according to the sales contract.
Also related to the A5 Apartment Complex, on April 13, the Ho Chi Minh City People's Committee issued a decision to fine Gamuda Land for signing a contract to buy and sell apartments in this apartment complex without a document from the Department of Construction notifying that it is eligible to sell or lease future housing according to the law. Pursuant to Clause 4, Article 58 of Decree 16/2022 of the Government , the Ho Chi Minh City People's Committee decided to fine Gamuda Land VND 900 million for illegal capital mobilization.
The company must also take remedial measures, which are to return the capital mobilized in violation of regulations. The time limit for implementing remedial measures is 10 days from the date of receipt of the decision. All costs for organizing the implementation of remedial measures shall be borne by the company.
Currently, many customers who have purchased apartments in the Diamond Alnata subdivision of the A5 Apartment Complex are petitioning Gamuda Land to implement the administrative penalty decision of the Ho Chi Minh City People's Committee and return the illegally mobilized capital. At the same time, they are requesting the investor to implement the terms of the contract and regulations on customer rights when Gamuda Land cannot hand over or is late in handing over the apartment.
Many customers have printed banners protesting Gamuda Land when this investor did not comply with the sales contract.
Specifically, according to the sales contract between customers and Gamuda Land, the house handover deadline stated in the contract is in the second quarter of 2022, along with the stipulation that the delayed handover period is allowed to be 90 days, then by the beginning of the fourth quarter of 2022, Gamuda Land is responsible for handing over the house to customers. It was not until January 2023 that some customers received a notice from Gamuda Land, requesting them to fulfill their financial obligations to receive the house. Thus, this investor has delayed the handover by about 4 months compared to the contract.
According to Article 11.7a of the sales contract, which stipulates “Penalty for late delivery”, if the buyer has fulfilled the payment obligation as prescribed but the seller does not hand over the apartment to the buyer, the seller will have to pay interest at the rate of 18%/year calculated on the total value of the purchase price payments that the seller has actually received from the buyer, for each day of late delivery. The interest payment is calculated from the date of the end of the permitted late delivery period until the date of the handover notice when the apartment is eligible for handover as prescribed.
The contract also states that the alternative is that the buyer may unilaterally terminate the contract and Article 18.4 of the contract shall apply. Pursuant to Article 18.4 of the sales contract, Gamuda Land shall refund the amount received from the customer (without interest), and pay the late delivery interest calculated on the total amount received, calculated from the date of termination of the permitted late delivery period until the effective date of the notice of termination of the contract.
In addition, Gamuda Land must also pay a fine equivalent to 30% of the purchase price for breach of contract and compensate for any actual damages incurred by the buyer due to the seller's breach of contract.
Gamuda Land is the real estate development division of Gamuda Berhad, Malaysia's leading infrastructure and construction group. Entering the Vietnamese market in 2007, Gamuda Land is currently investing in two urban areas: Gamuda City, covering 274 hectares in Hoang Mai District, Hanoi , and Celadon City, covering 82 hectares in Tan Phu District, Ho Chi Minh City.
Celadon City is a project built on an area of 82 hectares with a total investment of up to 1 billion USD. Currently, this urban area has been implementing many subdivisions including: Ruby, Emerald, Diamond Alnata, Diamond Alnata Plus, Diamond Brilliant, Diamond Centery, and The Glen (Condo Villa).
In addition, recently, the Elysian project at 170 Lo Lu Street (Truong Thanh, Thu Duc City, Ho Chi Minh City) was also promoted by Gamuda Land as the second project of this investor in Ho Chi Minh City. This is an apartment project deployed to anticipate the development of traffic infrastructure in this area with a scale of 3 hectares with nearly 1,400 apartments.
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