Background
Our client, a manufacturer, pursued a venture with a distribution company to import home appliances and sell them through home shopping and online channels, paying that distributor roughly KRW 900 million for goods in advance. The venture then collapsed when sales channels for the products fell through and quality problems compounded matters, and although the distributor went so far as to prepare a written repayment plan promising to "return the money received," it never performed. Changchun represented our client (the plaintiff), who had not been repaid.
The Issue
The contract provided that if the products did not sell, the distributor would take them over and refund the payment received. The key was to prove that refund undertaking and the obligation under the repayment plan clearly enough to recover a large sum.
How Changchun Helped
Changchun (attorneys Donghwan Shin and Jaesun Yoon) proved the existence and extent of the refund obligation without gaps, on the basis of ① the successive supply contracts and the record of payments and expenses our client had made, and ② the repayment plan the distributor had itself prepared, which specified the amounts, dates and interest.
Outcome
The court granted our client's claim and ordered the counterparty to pay approximately KRW 930 million plus default interest. Our client secured a foundation for recovering the large sum tied up in the failed venture.
Even where a venture has collapsed, a large sum can be recovered by identifying precisely the contractual refund undertaking and objective materials such as a repayment plan the counterparty itself prepared. (Outcomes may differ depending on the facts of each matter.)