Lawyer Do Van Luan
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Dear lawyer, can a customer be criminally liable for not paying credit card debt?
A credit card allows the cardholder to make purchases within the credit limit provided by the card issuer. Customers can borrow money within the credit limit specified in the card agreement, spend it, and then repay the credit organization in full or in monthly installments. If the customer fails to repay the entire amount borrowed within the agreed-upon time frame, they will be required to pay interest to the bank.
If a credit cardholder fails to repay their credit card debt, they may be subject to criminal liability for the crime of “Misappropriation of Property in Breach of Trust” as stipulated in Article 175 of the 2015 Penal Code, amended and supplemented by Article 35 of the 2017 Amended Penal Code, if there are sufficient elements to constitute a crime.
According to the law, does Eximbank continuously calculate interest for 11 years, when in 2017 the customers were aware of their bad debt and had discussions with the bank?
The interest rate and calculation method are determined based on the agreement between the two parties when the credit card is opened.
According to Article 468(1) of the 2015 Civil Code, the lending interest rate is agreed upon by the parties, but it must not exceed 20% per year, unless there are other relevant laws providing different regulations. However, the interest rate cap of 20% does not apply to the banking sector. According to Decision No. 1125 of the State Bank of 2023, banks are only allowed to agree on an interest rate of no more than 4% per year when granting loans for 5 priority areas such as agricultural and rural development, export-oriented business, serving the business of small enterprises, applying high technology, or buying a house.
Therefore, the interest rate for consumer loans using credit cards can reach any number. In this case, the bank may have applied compound interest by adding the interest amount to the principal for calculating the next term’s interest, on a monthly basis. Thus, the increase from VND 8.5 million to VND 8.8 billion over 11 years is entirely possible if the overdue interest rate is about 70% per year.
The customer has asked a lawyer to intervene and file a lawsuit, so what will be the course of action?
If the bank cannot negotiate with the customer to repay the principal and interest, they must sue the customer to recover this amount.
According to Article 150(3) of the 2015 Civil Code, the litigation time limit is “the time limit within which a subject is entitled to sue to request a court to settle a civil case to protect rights and legitimate interests that have been infringed; if that time limit expires, the right to sue is lost.” However, the time period for the customer’s payment default has been 11 years, so when filing a lawsuit, the bank may only be able to recover the principal amount of VND 8.5 million, and the amount of interest owed will depend on the agreement in the contract between the parties when opening the credit card to determine whether the litigation time limit has expired or not.
Because, according to the provisions of Article 155(2) of the 2015 Civil Code, the litigation time limit does not apply in cases of “requests to protect ownership rights, except as provided in this Code or other related laws,” a demand to collect the principal debt is considered a request to protect ownership rights, so the litigation time limit does not apply, and the creditor can file a lawsuit whenever they want.
Regarding interest arrears arising from a loan contract, it is considered a contractual dispute. Until now, when the bank filed a lawsuit to demand the repayment of the interest debt, based on Article 429 of the 2015 Civil Code, “the time limit for filing a lawsuit to request a court to settle a contractual dispute is 3 years from the date the person entitled to demand knows or must know their rights and legitimate interests have been infringed.” Therefore, to determine the litigation time limit in this case, it is necessary to rely on the agreement in the contract between the parties when opening the credit card to determine the moment when the bank knew or should have known that its rights and legitimate interests had been infringed. If this period has exceeded 3 years, the litigation time limit has expired, unless the restart of the litigation time limit is stipulated in Article 157(1) of the 2015 Civil Code, or it falls under the cases where time is not counted towards the litigation time limit for civil cases as specified in Article 156 of the 2015 Civil Code.
Thank you, lawyer.
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“Article 157. Restarting the litigation time limit in civil cases in the following cases: a) The obligor has admitted in whole or in part their obligations to the plaintiff; b) The obligor has admitted or fully performed part of their obligations to the plaintiff; c) The parties have reconciled with each other.” “Article 156. Time not counted towards the litigation time limit in civil cases, the time limit for requesting the settlement of civil matters” The time not counted towards the litigation time limit in civil cases, the time limit for requesting the settlement of civil matters is the period in which one of the following events occurs: 1. Force majeure events or objective obstacles that prevent the entitled subject from filing a lawsuit, making a demand that cannot be filed, demand within the time limit. A force majeure event is an objectively unforeseeable event that cannot be overcome despite the application of all necessary and feasible measures. An objective obstacle is an obstacle caused by an objective circumstance that makes it impossible for the person with civil rights and obligations to know about the infringement of their rights and legitimate interests or to perform their civil rights and obligations; 2. Lack of legal representative in the case where the entitled subject, the party entitled to make a demand, is a minor, has no capacity for civil acts, has difficulties in perception, control of behavior, or has their capacity for civil acts restricted; 3. The person in charge of representing the rights and interests of those who are minors, incapacitated, have difficulties in perception, control of behavior, or have their capacity for civil acts restricted has no other representative to replace them in the following cases: a) The representative dies if they are an individual, ceases to exist if they are a legal person; b) The representative is unable to continue to act as a representative for legitimate reasons.” |
