Paying more than 4 billion VND/m2 of auctioned land due to wrong recording
At the last land auction of 2023 in Me Linh district, Mr. Nguyen Thanh Tung paid 4.28 billion VND/m2, 142 times higher than the starting price for a 102m2 plot of land in Tien Thinh commune.
However, after the auction ended, Mr. Tung expressed his wish that the authorities consider withdrawing the deposit of more than 600 million VND (equal to 20% of the land value calculated according to the starting price) on the grounds that the price was recorded incorrectly.
On the morning of January 3, speaking with Dan Tri reporter about how to handle this matter, Mr. Hoang Anh Tuan, Chairman of Me Linh District People's Committee, said that in principle, according to the auction regulations, the auction winner must fulfill his financial obligations. On the contrary, if the auction winner does not fulfill the above obligations, it means losing the deposit.
A land auction in Me Linh district, Hanoi (Illustration photo: Truong Thinh).
However, according to Mr. Tuan, paying more than 4 billion VND/m2 is a normal mistake. The district authorities are reviewing this incident specifically, from which they will come up with a reasonable solution, according to the law.
"As a state management agency, we will act correctly and strictly according to the principles to protect the rights of those involved in this auction," Mr. Tuan affirmed.
46 plots of land put up for auction have areas ranging from 83.7m2 to 297.1m2; starting prices range from VND23.2 million/m2 to VND31.9 million/m2.
As a result, the lowest winning price was 23.4 million VND/m2, the highest was up to 47.6 million VND/m2. The total winning auction amount was over 150 billion VND, a difference of more than 25 billion compared to the starting price.
Is the information on the bid slip misleading?
Regarding this incident, speaking with Dan Tri reporter, real estate legal expert Nguyen Van Dinh commented that there was an error on the bid form. Mr. Dinh said this error was very basic and unnecessary, causing confusion for auction participants.
Specifically, the auction participant may have confused the land unit price (calculated in VND/m2) with the total price of the land plot (calculated in VND), meaning that Mr. Nguyen Thanh Tung may have bid 4.28 billion VND/the entire land plot, but the information on the bidding form required the participant to bid by m2.
"Mr. Nguyen Thanh Tung should have divided 4.28 billion VND by 102m2, equivalent to 41.96 million VND/m2 to fill in the form. However, instead of filling in 41.96 million VND/m2, Mr. Tung filled in 4.28 billion VND/m2," Mr. Dinh analyzed.
Part of the content on the land use right bid form in Chu Tran village, Tien Thinh commune, Me Linh district, Hanoi (Photo provided by legal expert Nguyen Van Dinh).
Thus, according to Mr. Dinh, there was an error on the bid form, there was an inconsistency in the units: The amount in numbers is VND/m2; in words is VND (the amount in words should also be VND/m2).
"From this mistake, we can question the capacity of the property auction organization. How could such a basic and unnecessary mistake happen? From here, we can see that there is a basis for Mr. Tung to be confused because the bid form has an error," Mr. Dinh emphasized.
Regarding the solution to this matter, he said that Article 72 of the 2016 Law on Property Auction has stipulated cases of cancellation of property auction results, however, there is no case that directly applies to Mr. Tung's case.
However, according to Mr. Dinh, in this case, Mr. Nguyen Thanh Tung can rely on the provisions of Clause 1, Article 72 of the Law on Property Auction regarding the cancellation of property auction results "According to the agreement between the person with the auctioned property, the property auction organization and the auction winner on the cancellation of the property auction results..."
Accordingly, Mr. Tung can base on the error on the bid form, base on the court's decision declaring the transaction invalid due to mistake (if any) to request the property auction organization and the person with the auctioned property to negotiate and discuss the cancellation of the property auction result.
"In this case, the property auction organization (auction company) may have to compensate the owner of the auctioned property (Me Linh District People's Committee) according to Point d, Clause 2, Article 24 of the Law on Property Auction and the signed property auction service contract," Mr. Dinh shared.
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