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In many construction projects in Vietnam, disputes do not arise because parties intend to breach the contract, but because the contract no longer reflects how the project is actually being executed.
The signed agreement may say one thing, while on-site reality tells a very different story:
different contractors performing the work, informal variations, payment flows outside the contract, or project control exercised by parties not named in the agreement.
When problems surface—delays, defects, payment disputes, or termination—the mismatch between the contract and reality becomes a serious legal risk.
So what should businesses do when their construction contract no longer reflects the real project?
Construction projects in Vietnam evolve quickly, especially in FDI and EPC projects. Common reasons contracts fall out of sync with reality include:
Urgent project timelines leading to shortcuts at signing
Reliance on informal instructions and site practices
Changes in subcontractors or scope without formal amendments
Regulatory or licensing constraints handled “off-contract”
Commercial pressure to keep the project moving
While these practices may seem practical at the time, they significantly increase legal exposure if a dispute arises.
Vietnamese courts and authorities increasingly focus on substance over form.
This means that when a dispute occurs, they will look beyond the written contract and examine:
Who actually performed the work
Who controlled the site and gave instructions
Who received payments and economic benefits
How the project was managed in practice
If the contract does not match reality, it may:
Be partially unenforceable
Be reinterpreted against the parties’ expectations
Expose additional parties to liability
In serious cases, courts may disregard the contractual structure entirely.
A common mistake is assuming that the signed contract automatically protects all parties.
If the project has evolved beyond the contract, continuing to rely on outdated terms is risky. Instead, businesses should acknowledge the gap and address it proactively—before disputes escalate.
A legal assessment should focus on questions such as:
Is the named contractor the actual performer?
Are subcontractors operating beyond permitted scope?
Have payment methods changed from what the contract provides?
Have variations been implemented without formal approval?
Has project control shifted to another entity?
Understanding these gaps is essential before deciding how to fix them.
When contracts do not reflect reality, risks extend beyond civil disputes.
Possible consequences include:
Contractual liability for parties who lack real control
Joint liability for parties not named in the contract
Administrative penalties for illegal subcontracting
Project suspension or compliance investigations
Early legal review helps determine which risks are already material and which can still be mitigated.
In many cases, the safest solution is not to terminate the contract, but to bring it back in line with reality.
This may involve:
Contract amendments
Formal recognition of subcontractors
Revised scope of work and responsibilities
Updated payment and reporting mechanisms
The goal is to ensure that the written agreement accurately reflects how the project is actually being executed.
Informal site instructions are one of the biggest sources of dispute in Vietnam.
When changes occur:
They should be documented in writing
Approval authority should be clearly identified
Time and cost impact should be recorded
Without documentation, parties often struggle to prove their position in disputes.
When the contract no longer reflects reality, termination becomes especially risky.
Improper termination may:
Trigger counterclaims
Expose the terminating party to damages
Lead to regulatory scrutiny
Legal advice is essential before suspending work or terminating a contract that no longer matches project practice.
Many companies delay action because the project is still moving.
Unfortunately, once a dispute arises:
Positions harden
Evidence becomes contested
Informal practices work against the parties
Correcting structural problems early is far cheaper and more effective than litigating later.
Many investors rely on legal review only at the signing stage.
However, construction projects are dynamic. Without continuous legal oversight:
Contracts quickly become outdated
Informal practices take over
Legal risk accumulates unnoticed
This is why construction disputes often come as a surprise to management.
With ongoing legal consultancy, businesses can:
Monitor contract compliance throughout the project
Identify deviations early
Formalize changes before disputes arise
Align commercial decisions with legal requirements
This proactive approach significantly reduces dispute and liability risk.
Foreign investors face additional challenges:
Limited familiarity with Vietnamese construction law
Dependence on local partners and contractors
Language and documentation issues
When contracts and reality diverge, foreign investors often face disproportionate risk.
Continuous legal support helps bridge this gap.
DEDICA provides ongoing legal consultancy services for construction projects and FDI investments in Vietnam, focusing on aligning contracts with actual project execution.
DEDICA supports clients by:
Reviewing construction contracts against on-site reality
Identifying hidden liability risks
Advising on contract amendments and compliance
Supporting dispute prevention and resolution
Representing clients before Vietnamese courts and arbitration
DEDICA’s approach emphasizes legal accuracy, enforceability, and risk prevention, not reactive crisis management.
When a construction contract no longer reflects the actual project, ignoring the mismatch is not an option.
Vietnamese law looks beyond written agreements to determine legal responsibility. The greater the gap between contract and reality, the higher the risk for all parties involved.
By engaging ongoing legal consultancy, businesses can:
Correct misaligned contracts early
Prevent hidden liability
Reduce dispute and compliance risk
Protect long-term project value
📞 Hotline: (+84) 39 969 0012 (Available via WhatsApp, WeChat, Zalo)
🕒 Working Hours: Monday – Friday (8:30 – 18:00)
Contact us today for a free initial consultation with our experienced lawyers!
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