Appeal verdict will be announced for 20 defendants in the case related to Vu Nhom
On the afternoon of May 12, the High People's Court in Hanoi will announce the appeal verdict for 20 defendants in the case of violations in the management of public housing and land in Da Nang, including two former Da Nang chairmen Tran Van Minh and Van Huu Chien.
The court of first instance ordered Da Nang to reclaim the 29-hectare project related to Vu "Nhom" with nearly 200 villas, but whether the verdict will be changed or not must await the appeal judgment.
In addition to the defendants’ criminal liability and compensation, the appellate court also decided the legal fate of the 29-hectare land plot in the Da Phuoc international urban area. The damage caused by the defendants in managing this land plot is alleged to account for half of the more than VND22,000 billion in damage in the case.
According to the case file, the 29-hectare project belongs to the Da Phuoc International New Urban Area project, Tam Thuan ward, Thanh Khe district and Thanh Binh ward, Hai Chau district. Since 2006, before the Da Nang People's Committee and Daewon Company signed the Agreement in Principle, Phan Van Anh Vu (Vu "Nhom", Chairman of the Board of Directors of Construction Joint Stock Company 79) was assigned by the leaders of Da Nang city to cooperate with Daewon Cantavil Company to implement the Da Phuoc International Urban Area project.
 |
| "Vu Nhom" at a trial. Photo from the internet |
On July 12, 2011, Mr. Van Huu Chien (Vice Chairman of the City People's Committee) signed Decision No. 5870 to transfer the right to use 29 hectares of land to Construction Joint Stock Company 79 for 87 billion VND to build townhouses and villas. Meanwhile, the value of the land use right and the value of assets on the land according to the project's market price at the time of transfer was more than 4,788 billion VND.
Having been granted a land use rights certificate, at the end of November 2015, Daewon signed a contract to transfer 51% of the charter capital at Da Phuoc Housing Development Company Limited to Vu "Nhom" Construction Joint Stock Company 79 for 340 billion VND.
After transferring the capital contribution, Da Phuoc Housing Development Company Limited changed its name to Da Phuoc Housing Development Company Limited with Vu "Nhom" as chairman. On November 30, 2015, Vu "Nhom" signed a contract to transfer all capital contribution at Da Phuoc Housing Development Company Limited to Mr. Vo Ngoc Chau (residing in Ho Chi Minh City) for 428 billion VND.Currently, the investor of the 29-hectare project, Da Phuoc Housing Development Company Limited, has built commercial townhouses and high-rise apartments combining trade and services. 189 villa plots, with an area of 16,600 m2, have been transferred to nearly 200 customers, with a total transaction value of VND 1,280 billion. Villas, roads, schools, and utilities have been put into use. People are living stably.
In the first instance judgment on January 13, the Hanoi People's Court requested the Da Nang People's Committee and related parties to carry out legal procedures to ensure the rights of citizens in the project. This content was later corrected by the first instance court to "assign the Da Nang People's Committee to reclaim and, together with related parties, carry out legal procedures to ensure the rights of citizens in the land".
However, the representative of the People's Committee of Da Nang City (civil plaintiff), Director of the Department of Natural Resources and Environment To Van Hung, when presenting at the appeal hearing, stated that if assigned, the recovery of the above land would be difficult and troublesome because Da Phuoc Housing Company is a bona fide third party. The company has invested in large-value projects, many items have been completed and put into use, some are under construction. The court's decision causes difficulties for the bona fide third party; the compensation value for the land value will be very large, and the budget will be difficult to meet. People's lives are affected.
Da Phuoc Housing Development Company Limited appealed the above correction because it considered it unfavorable to it. The 29-hectare land was transferred by the Da Nang People's Committee to Construction Company 79. After that, Construction Joint Stock Company 79 transferred its shares to Da Phuoc Company in accordance with the procedures recorded by the competent state agency.
Therefore, this company requested the appellate court to partially annul the first instance judgment to ensure its rights as a bona fide third party. If the project is revoked, it will have serious legal consequences when 200 households buying houses in the project are granted land use right certificates, forcing Da Phuoc Company to go bankrupt due to a VND1,500 billion loan from the bank to develop the project.
Vu "Nhom" said that his Construction Joint Stock Company 79 received the project from a foreign investor, not from Da Nang. However, before the company could do anything on the project, the Government Inspectorate came to inspect and concluded that the project had lost more than 570 billion VND. Vu's Construction Company 79 then asked to return the land, receiving back 87 billion VND that had been paid to buy the land, which was actually water surface. After that, Vu's company sold 49% of the company's shares to Mr. Vo Ngoc Chau. Vu "Nhom" said that the investigation agency misunderstood that he sold the above project to Mr. Chau.
In response to this statement, Mr. Chau confirmed that he had bought shares as Vu had stated. On this land, Mr. Chau's company built houses, sold villas, and built roads...
Presenting its viewpoint on resolving the case, the High-level People's Procuracy in Hanoi stated that this was a violating project, so its revocation was justified and proposed that the Da Nang People's Committee be assigned to repossess, auction, and prioritize those who do it in accordance with legal regulations.
Also related to this project, many defendants who were found guilty of related violations have pleaded not guilty in court. Former Chairman of Da Nang Tran Van Minh said that the prosecution agencies' comparison of the Land Law to accuse him of violations was incorrect. With this land, the implementation must be compared with the Investment Law.
Former Director of the Department of Natural Resources and Environment Nguyen Dieu denied the accusation of advising on the proposal to assign the 79 Construction Company to land projects without auction, an accomplice of Mr. Tran Van Minh, causing losses to the state of more than 11,000 billion VND. The 29-hectare land is just a small construction item in the Da Phuoc New International Urban Area project. This land assignment was carried out under the Investment Protection Agreement (signed in 2006). Dawon Catavil Company is a foreign legal entity, when it is a joint venture with a Vietnamese company and has the right to lease land. This land assignment is also in accordance with Vietnam's land regulations. Land that has not been compensated for site clearance does not have to be auctioned. In addition, this land has been assigned to investors and is not auctioned.
Mr. Dieu also affirmed that the land allocation did not cause any damage but only benefited Da Nang. The land allocation was therefore correct and in accordance with the law.
The appeal hearing opened on May 4. According to the first instance verdict, from 2006 to 2014, Da Nang Chairman Tran Van Minh and Van Huu Chien were the leaders responsible for directing the management and use of state assets and land management in Da Nang. However, the two men intentionally violated regulations on the management and use of state assets and regulations on land management, creating favorable conditions for Vu "Nhom" to make personal profits in the purchase, sale, and transfer of public real estate and real estate projects. The defendants' violations caused the state to lose more than 22,000 billion VND.
