Background
Our client, a logistics company, agreed in June 2021 to buy nine parcels of forest and other land in Gyeonggi Province from a family clan association (jongjung) for about KRW 19.79 billion. The first deposit of KRW 1,000,000,000 was covered by money an affiliated construction company had already paid, and our client paid two further deposits of KRW 494,834,500 each, for a total of KRW 1,989,669,000. Our client later sought the deposits back, arguing that the sale was void because the clan never validly approved it. The clan replied that our client had defaulted on the balance and that the deposits were forfeited.
What Was at Stake
Clan property belongs collectively to all members and may be disposed of only through the procedure in the clan's rules. The issues were whether that procedure was followed and whether later ratification by a general meeting was valid.
How Changchun Helped
Law Firm Changchun represented the buyer at first instance and on appeal, and at the Supreme Court the creditors who had taken over part of the refund claim. The courts held that the association was a true clan of all descendants, so women were members. The board resolution approving the sale was invalid because it was convened by an unelected chairman. The 2023 ratification meeting was void because only 59 of 72 male members, and no women, received notice, and later meetings in 2025 came after our client had withdrawn its offer in September 2023.
Outcome
In May 2025 the first-instance court ordered the clan to return KRW 1,989,669,000 with 12% annual late-payment damages. After our client's creditors took over parts of the claim by court transfer orders, the appellate court in December 2025 divided the refund among them and our client. In April 2026 the Supreme Court of Korea dismissed the clan's final appeals without a merits review.
Before buying land from a clan, buyers should check its rules, membership roster, and approval procedure before focusing on price. (Outcomes depend on the facts of each case.)