Enterprise

“Court Annuls Investment Cooperation Contract Between CKG and Dao Vang”

On July 25, 2025, the People's Court of An Giang Province delivered the verdict on the appeal trial involving a dispute over a joint venture agreement between CIC Group Joint Stock Company (HOSE: CKG) and Golden Island Real Estate Services Limited Liability Company.

Administrator

25 August, 2025

Sona Valley (formerly known as Búng Gội) Project Perspective. Source: CKG

Regarding the case details, CKG is the investor of the high-end villa project named Búng Gòi, located in Búng Gòi ward, Phú Quốc special district, An Giang province. The project covers an area of 68,968m2 and its 1/500 detailed plan was approved back in 2017.

After conducting on-site inspections and legal document reviews, Đảo Vàng Company signed an investment cooperation contract with CKG in March 2018. Per the agreement, CKG, as the investor, would receive capital contributions from its partner to implement the project. Subsequently, they would distribute revenue and repay the capital contributions as per the agreed terms.

The contract value was nearly VND 601 billion, including land use rights valued at over VND 217 billion and infrastructure and housing construction costs estimated at nearly VND 384 billion.

Đảo Vàng Company was responsible for contributing the aforementioned amount of nearly VND 601 billion to CKG in two phases. The first phase was divided into three installments, totaling more than VND 217 billion. The first installment of VND 60 billion was paid upon signing the cooperation contract. The second installment of VND 80 billion was due after CKG completed the project’s infrastructure construction. The remaining amount of over VND 77 billion was to be paid in the third installment once CKG fulfilled its obligation to pay the land use purpose conversion tax and obtained the land use right certificates for the project, enabling its transfer to customers.

In February 2020, the two parties signed an additional appendix to the contract, stating that in addition to the already contributed VND 60 billion, the first installment also included the entire amount of land use purpose conversion tax. Đảo Vàng Company was obligated to pay CKG the full amount of land use tax within 30 days from the date of CKG receiving the tax notification.

However, when CKG received the tax notification from the authorities in October 2022 and subsequently requested its partner to pay the land use purpose conversion tax multiple times, Đảo Vàng Company failed to fulfill its capital contribution obligation for the first installment as per the signed appendix.

Based on the 2018 contract, CKG requested the court to annul the investment cooperation contract and its appendix, citing the partner’s breach of payment obligations and the expiration of the contract term.

Regarding the VND 65 billion contributed by Đảo Vàng Company, CKG stated that after deducting the penalty (3% of the total contract value), they would refund their partner nearly VND 47 billion.

In its counterclaim, Đảo Vàng Company argued that there were two necessary and sufficient conditions for fulfilling the payment obligation, which CKG had not completed. Firstly, CKG had not finished constructing the infrastructure according to the approved design. Secondly, CKG had not executed sales contracts for future homes with customers designated by Đảo Vàng Company.

Additionally, during the contract implementation, Đảo Vàng Company had sent multiple correspondence requesting CKG to provide project progress updates but had not received any relevant documentation.

Regarding the contract term, Đảo Vàng Company pointed out that the cooperation contract included a clause stating that the implementation period could be extended in the event of force majeure. The company cited the social distancing measures due to the COVID-19 pandemic as such an event.

Based on these factors, Đảo Vàng Company requested CKG to continue fulfilling its obligations under the cooperation contract, including executing sales contracts directly with customers designated by Đảo Vàng Company.

Đảo Vàng Company agreed to cancel the contract only if CKG compensated them for more than VND 156 billion, returned the contributed VND 65 billion, and accepted the 62 customers they had introduced.

Conclusion of the Appellate Court

The appellate court found that after signing the contract appendix in 2020, the deadline for fulfilling the cooperation contract was adjusted to December 31, 2021. However, CKG only received the notification to pay the land use purpose conversion tax in 2022 and subsequently informed Đảo Vàng Company. As there was no signed document extending the contract term, CKG’s request for Đảo Vàng Company to pay the tax fell outside the agreed terms.

Furthermore, Đảo Vàng Company had completed the payment for the first installment (VND 60 billion) and VND 5 billion for the second phase. The condition for the second installment contribution of VND 80 billion was for CKG to complete the infrastructure construction, which would then be inspected by a consulting unit and jointly accepted by both parties. However, there was no evidence to prove that Đảo Vàng Company had accepted this construction item.

Moreover, to contribute the full VND 80 billion for the second installment, CKG needed to sign future home sales contracts with customers referred by Đảo Vàng Company (62 contracts), which had not been fulfilled.

Given these considerations, the appellate court ruled to annul the investment cooperation contract between the two parties but did not accept CKG’s claim for compensation of more than VND 18 billion (3% of the total contract value).

Regarding Đảo Vàng Company’s counterclaim, the court ordered CKG to refund the full amount of VND 65 billion, along with execution interest. Regarding the compensation of more than VND 156 billion, the appellate court returned the entire case file to the first-instance court for resolution according to common procedures.

– Hà Lễ

– 08:36 25/08/2025