Background
Our client is a regional housing cooperative developing an apartment project. In 2019 it hired a project management company to recruit members and agreed to pay a management fee of KRW 5.445 billion.
The counterparty, who had lent money to the management company, claimed that in May 2024 the company assigned to him part of its fee and other receivables equal to the sale price of one apartment unit, KRW 352,855,000. On that basis he sued our client for KRW 260 million plus interest and provisionally attached two apartments owned by our client. The first-instance court ruled in his favor.
What Was at Stake
An assignment is effective only if the assigned receivable actually exists. The issues were whether any management fee remained owing when the assignment was notified in May 2024, and whether the assignment could be read to cover other receivables.
How Changchun Helped
Law Firm Changchun represented our client on appeal, and the appellate court accepted the following points:
Prior payments: Between April 2021 and April 2022 our client paid three progress payments of KRW 1 billion, KRW 700 million and KRW 150 million, totaling KRW 1.85 billion, leaving KRW 3.595 billion.
Earlier assignment order: Another creditor's seizure and assignment order for up to KRW 4 billion was served on our client in March 2024, before the assignment notice. The entire remaining KRW 3.595 billion had already passed to that creditor, so the counterparty's assignment had nothing to transfer and was void.
No broader reading: The phrase "management fee and other receivables" had to be limited to receivables arising from the management contract. Reading it to cover every receivable would leave the assigned claim unidentified and void.
Outcome
In December 2025 the appellate court set aside the first-instance judgment, dismissed the claim in full and ordered the counterparty to bear all litigation costs. No final appeal was filed, and the judgment became final and conclusive on January 1, 2026. Changchun then applied to lift the provisional attachment on the two apartments.
A defendant facing an assigned-receivable claim should first line up prior payments and the dates on which competing seizures were served. Doing so can overturn even a first-instance loss. (Outcomes depend on the facts of each case.)