Background
In the pre-sale of "section offices" (offices divided into small units) in the greater Seoul area, some purchasers claimed their contracts were void, arguing that "we were not told in advance that not installing partition walls would reduce our financing." Changchun represented the developer.
What Was at Stake
The purchasers sought to rescind their contracts on grounds of the seller's "deception" or their own "mistake," and to recover loan interest and other sums. The issues were whether the seller owed a duty to disclose those circumstances, and whether the purchasers' misjudgment could be laid at the seller's door.
How Changchun Helped
Changchun (attorneys Jaesun Yoon, Donghwan Shin, Sungjoong Kim and Hyunwoo Joo) proved that the seller owed no duty of disclosure and had no intent to deceive, on several grounds: the contract contained no clause guaranteeing financing; the purchasers had themselves chosen "no partition walls" and received consideration for it; and the change in financing terms was a circumstance the seller could not have known.
The court rejected all of the purchasers' claims (dismissed). The case shows that who bears which risk under a pre-sale contract is ultimately determined by the terms of the contract itself. (Outcomes depend on the facts of each case and may differ.)