Background
In June 2018, through an acquaintance, our client met Mr. B, an inside director of a development company. Mr. B asked to borrow KRW 100 million for one month, promising repayment once a savings bank loan came through. Our client lent the money, but Mr. B never repaid it.
After repeated demands, in March 2021 Mr. B signed a confirmation promising to pay KRW 250 million by the end of September 2021 and, if necessary, to provide two officetel units under construction as security. He broke that promise too and cut off contact. It emerged that in November 2019 he had gifted his only home to Mr. C and transferred title.
What Was at Stake
Changchun filed two suits: one against Mr. B for the amount promised in the confirmation, and one against Mr. C to revoke the gift as a fraudulent transfer and restore the home to Mr. B's name. Mr. C argued that the confirmation had replaced the original KRW 100 million debt with a new obligation (novation), so no qualifying claim existed at the time of the gift.
How Changchun Helped
The court accepted the plaintiff's arguments.
The confirmation only changed how the debt would be repaid. Its purpose was still repayment of the loan; only the amount, due date, and security were reset, so the original claim survived.
Debts exceeded assets at the time of the gift. The court valued Mr. B's assets in November 2019 at approximately KRW 179 million and his debts at approximately KRW 285.93 million. It rejected the argument that a debt to another creditor was later extinguished, because insolvency is judged as of the gift.
Outcome
Mr. B did not answer the first suit, and in November 2024 the first-instance court entered judgment without a hearing ordering him to pay KRW 250 million plus delay interest. In August 2025, the first-instance court in the second suit revoked the gift and ordered cancellation of Mr. C's title registration. The opposing parties bear the costs in both cases.
A money judgment is most effective when paired with action to bring back assets the debtor has moved away. (Outcomes depend on the facts of each case.)