Background
Our client lent an acquaintance large sums on several occasions, and the borrower repaid in installments. The borrower then claimed return of approximately KRW 79 million as unjust enrichment, asserting that "I paid interest exceeding the statutory ceiling, so return the excess," and in the alternative claimed approximately KRW 113.5 million under an agreement. Changchun represented our lending client (the defendant).
The Issue — Was There Really "Excess Repayment (Unjust Enrichment)"?
The matter involved multiple loans and repayments interwoven over a long period. The key questions were whether repayment exceeding the ceiling had actually occurred once the limits under the Interest Limitation Act were applied in the settlement, and how repayments were to be applied as between principal and interest, and on what basis (simple interest, and from what date) interest was to be calculated.
How Changchun Helped
Changchun (attorney Jaesun Yoon) reconstructed each loan and repayment as a precise date-by-date settlement table, and applied the ceilings under the Interest Limitation Act (25% per annum, later 24% per annum) accurately on a simple interest basis. This proved that the amounts the borrower had repaid fell within the proper range of principal and interest, so that no excess repayment (unjust enrichment) existed, and that the alternative contractual claim was likewise without foundation.
Outcome
The claim was dismissed at first instance, and the appellate court dismissed the appeal, leaving our client's (the defendant's) victory intact.
In disputes where many loans and repayments are intermingled, date-by-date settlement and accurate application of the statutory interest ceiling decide the case. Precisely reconstructing the settlement structure is more than enough to defeat a vague claim of "unjust enrichment." (Outcomes may differ depending on the facts of each matter.)