Daegu Legal Consultation Assistance | Case of a Client Who Recovered an Association Member's Down Payment Through a Daegu Legal Consultation

In the legal consultation in Daegu, we listened to the detailed circumstances of the case in order to recover the client's down payment.

In urgent need of securing a home, the client saw the promotion of a regional housing association stating that a home could be obtained at a low price without subscription competition, joined a regional housing association, and paid approximately 76 million won as a membership fee.

Recently, however, the client learned through media reports that a person who is not a "head of household" cannot become a member of a regional housing association.

Although he knew that he could not become a member because he was not a head of household, he sought to bring a lawsuit for the return of the down payment against the association member who had induced him to enter into the contract.

A regional housing association is a real estate project in which residents of a given area form an association and, after obtaining approval of the project plan, secure housing; the association itself purchases the land, raises the construction costs, and otherwise advances the project.

For this reason, compared to ordinary apartment construction or sale in which a developer is involved, participants may purchase an apartment at a lower price; and unlike general housing improvement projects governed by the Act on the Maintenance and Improvement of Urban Areas, such projects are governed by the Housing Act, so the licensing and permit process is comparatively simple.

If, like the client, a person was defrauded at the time of entering into the contract and wishes to 🔗withdraw as a regional housing association member, he or she may withdraw and obtain a return of the down payment by applying the "declaration of intent induced by fraud (revocation)" and "original impossibility (nullity)."

The Daegu legal consultation first assisted in sending content-certified mail in order to uncover the fraudulent act of the association member, who had the client enter into the contract even though the member knew that the client was not qualified for membership.

Through the member’s reply letter regarding this, it was proven that the member had known at the time of the contract that the client could not meet the membership qualifications.

The client learned only belatedly, through media reports, that because he was not a head of household, he did not qualify for membership in the association.

Accordingly, we argued that the contract could be rescinded on the ground that the association had induced the client to conclude the contract by deceiving him into believing that he could become a member at a later time.

We therefore argued that, since this association membership contract concluded with the client, who lacks membership qualification, constitutes a void contract, the association is obligated to return the entire contract payment to him as unjust enrichment.

Recently, there was a report that a 29 billion won embezzlement and fraud in connection with a regional housing association was uncovered, causing association members to suffer enormous property damage.

Because regional housing association projects are particularly prone to fraud damage, laws are being amended to prevent this, but withdrawal or refund is not easy.

Therefore, if you have suffered fraud damage, you should obtain the assistance of a real estate attorney to secure the relevant evidence, quickly establish a favorable strategy, and proceed with a return lawsuit.

The Construction and Real Estate Group of Daeryun Law Firm includes attorneys with strong capabilities, such as attorneys registered as real estate specialists with the Korean Bar Association, who actively assist clients, so if you need help, please feel free to request a consultation at any time.

🔗 Go to the Daeryun Construction and Real Estate Group regional housing association practice area