LIABILITY FOR NON-CONTRACTUAL DAMAGES ARISES EVEN WHEN THE DAMAGING ACT IS NOT A VIOLATION OF LAW AND THE PERSON PERFORMING THE ACT IS NOT AT FAULT

Previously, the adjudication of cases related to non-contractual compensation was carried out under the guidance of the Council of Judges of the Supreme People's Court in Resolution 03/2006/NQ-HDTP ("Resolution 03"). However, given the adoption of the 2015 Civil Code, many contents in Resolution 03 has been being no longer relevant. Recently, since 06/09/2022, the Board of Directors has issued Resolution No. 02/2022/NQ-HDTP ("Resolution 02"), replacing Resolution 03 to guide the application of regulations on liability for non-contractual damages ("BTTH"). Resolution 02 contains various notable contents as follows:

Changes in the grounds for arising compensation liability

Resolution 02 provides guidance on the grounds for arising compensation liability under Article 584.1 of the 2015 Civil Code. Accordingly, compensation liability arises when the following factors are fully satisfied:

1. There is an infringement against life, health, honor, dignity, prestige, property, or legitimate rights and interests of others;
2. There is material or mental damage;
3. There is a causal relationship between the damage and the infringement. The damage must be the inevitable result of the infringement and the infringement is the cause of the damage.

Pursuant to this regulation, the 2015 Civil Code as well as Resolution 02 have had numerous amendments related to the grounds for arising non-contractual compensation liability compared to the 2005 Civil Code and Resolution 03, including:

1. Damaging behavior is not required to be a legal violation. Accordingly, the "infringement against the life, health, honor, dignity, prestige, property, or legitimate rights and interests of others", regardless of any legal regulation, can also lead to compensation.
2. The factor "fault" of the person causing the damage is not bound. The person causing the damage who is not be at fault or is unaware of his/her behavior, may still be responsible for damages.
3. Clear classification of actual damages, specifically:

• Physical damage is defined as monetary or monetary-convertable losses, namely (i) unrecoverable property damage; (ii) reasonable costs to prevent, limit and remedy damages; (iii) actual income that is lost or diminished due to the infringement against property, health, life, honor, dignity, reputation, or legitimate rights and interests.
• Mental damage is mental losses caused by the infringement against life, health, honor, dignity, reputation, rights and other interests suffered by a subject or their relatives that need to be compensated for such loss.

Unlike previously, the regulation in Resolution 02 is clearer and more general, and is also more consistent with trial practice, ensuring the rights of litigants.

Detailed instructions on a number of compensation principles

1. In criminal and/or administrative cases, if compensation is required, the Court must prioritize/at the same time settle the compensation before/along with resolving other contents of the case.

1. The damaged party who is partially at fault for the damage is not entitled for compensation corresponding to that part of the fault.
2. The party, whose rights and interests are infringed, knows and foresees the damage without any preventation, eventhough he/she is capable to do so, shall be not entitled for compensation.

In addition, Resolution 02 also contains specific instructions on issues related to damage determination, subjects responsible for compensation, statute of limitations for compensation, etc.

This resolution took effect on January 1, 2023.