Are “Pay When Paid” Provisions Enforceable in Vietnam Jurisdiction?

Question from Waterbearer, Are “Pay When Paid” Provisions Enforceable in Vietnam Jurisdiction?

Answer from AI:

The “pay when paid” provision is a common clause in many contracts, particularly in the construction industry. This clause stipulates that a contractor or subcontractor is not obligated to pay their subcontractors until they themselves have been paid by the client. The enforceability of these provisions can vary greatly depending on the jurisdiction.

In Vietnam, the enforceability of “pay when paid” provisions is not explicitly addressed in the law. However, the general principles of contract law, as outlined in the Civil Code of Vietnam, may apply. According to these principles, all contractual provisions must be fair, reasonable, and in compliance with the law.

It’s important to note that while the “pay when paid” provision may be included in a contract, it may not be enforceable if it is deemed to be unfair or unreasonable. For example, if the delay in payment is excessively long or if the contractor is using this provision to avoid paying the subcontractor, a court may rule that the provision is unenforceable.

Here are some general steps you might take if you’re dealing with a “pay when paid” provision in Vietnam:

1. Review the contract carefully: Make sure you understand all the terms and conditions, including the “pay when paid” provision.
2. Seek legal advice: If you’re unsure about the enforceability of a “pay when paid” provision, it’s a good idea to consult with a legal professional. They can provide personalized advice based on your specific situation.
3. Negotiate the contract: If you’re not comfortable with the “pay when paid” provision, try to negotiate the contract terms with the other party. You may be able to agree on a more reasonable payment schedule.

Remember, this information is a general guide and not a substitute for legal advice. Laws and regulations can change, and they can be interpreted differently depending on the specific circumstances. Always consult with a legal professional for advice tailored to your situation.

For more information on contract law in Vietnam, you can refer to the Civil Code of Vietnam.

Please note: This information is intended to provide a general understanding of the law. It is not intended to provide legal advice. Please consult with a legal professional for advice specific to your situation.