Law Firm Changchun LLC, acting for a client who had taken over a pharmacy, obtained judgment in the plaintiff's favor in full in a key money refund claim brought against the pharmacy's former operator.
Our client took over the pharmacy's facilities and goodwill in their entirety from the former operator, paying several hundred million won in key money. The business transfer agreement was premised on the continued operation of nearby medical institutions for a defined period, and included a special clause providing that if any such institution relocated or closed within that period, key money corresponding to the remaining period would be refunded.
After the takeover, and before the guarantee period fixed in that clause had run, one of the medical institutions materially important to the pharmacy's business closed. Prescription and dispensing revenue associated with that institution ceased, and our client requested that the former operator refund part of the key money in accordance with the special clause.
The former operator denied any refund obligation, arguing in substance that the closure was not attributable to any fault of its own and that our client had suffered no real loss because another medical institution in the same specialty had subsequently opened.
Law Firm Changchun LLC closely analyzed the wording of the business transfer agreement and the legal character of the key money refund clause, calculated in concrete terms the amount to be refunded on the basis of the dispensing fee ratio attributable to each medical institution and the total key money, and acted in the resulting claim against the former operator.
The court accepted Law Firm Changchun LLC's arguments and held that the former operator must pay our client the full amount claimed together with default interest.
The case is significant in that it obtained clear recognition of the legal effect of a guarantee clause where the continued operation of nearby medical institutions forms an important premise for calculating key money in a pharmacy business transfer.
Drawing on accumulated practical experience and closely constructed legal arguments in disputes over key money, business transfers, commercial leases and goodwill involving pharmacies and medical institutions, Law Firm Changchun LLC devotes itself to protecting our clients' rightful entitlements and financial interests.