Housing Lease Protection Act | Full refund of the lease down payment obtained with the help of a real estate attorney

The client, a prospective bride preparing for her wedding, entered into a lease agreement with the defendants in order to set up her newlywed home in the OO Apartment.

On the day of the agreement, the client paid the defendants 25 million won.

However, through the client's licensed real estate agent, the defendants suddenly stated that they needed to repair the master bathroom, and asked the client to choose one of the following: (1) the client would pay the balance but postpone the actual move-in date; (2) construction would begin immediately and the client would move in approximately two days later than the actual move-in date; or (3) the client would carry out the repairs after moving in.

However, the licensed real estate agent did not see the message, and the defendants unilaterally notified the client that they would carry out the construction after the client moved in as scheduled.

Upon learning of this, the client, instead of choosing option (1) of paying the balance but postponing the actual move-in date, requested that the defendants inform her of the exact date on which the construction would be completed and that they provide support for the monthly rent corresponding to the additional period for which the plaintiff would have to remain in her current residence during the construction owing to the delayed move-in.

However, stating that the matter could not be resolved amicably, the defendants unilaterally canceled the agreement, and the client sought to file a lawsuit for payment of the down payment pursuant to the Housing Lease Protection Act.

The termination of a lease agreement, which is central to lease disputes, refers to the termination of a lease agreement, that is, an agreement under which one party allows the other party to use and profit from the subject property and, in return, receives a certain rent.

The Housing Lease Protection Act sets forth provisions for recovering the deposit when a lease agreement is terminated.

▣ Housing Lease Protection Act

Article 3-2 (Recovery of Deposit)

(1) Where a lessee applies for an auction of the leased housing pursuant to a final and conclusive judgment in a lawsuit for the return of the deposit or any other title of execution equivalent thereto, the performance or tender of performance of the counter-obligation shall not be a requirement for the commencement of execution, notwithstanding Article 41 of the Civil Execution Act concerning the requirements for the commencement of execution.

Article 3-3 (Order to Register a Lease Right)

(1) Where the deposit has not been returned after the lease has ended, the lessee may apply for an order to register the lease right to the district court, the branch of the district court, or the city or county court having jurisdiction over the location of the leased housing.

While the defendants argued that they had intended to perform the lease agreement with the client, they had not had the former tenant who was residing in the apartment vacate it.

As a result of the client's inquiry, it was emphasized that the existing tenant vacated the apartment only well after the date on which the client paid the balance, which showed that the defendants, despite their obligation to deliver the apartment to the client, had made no preparation whatsoever to perform the agreement.

The defendants unilaterally canceled the agreement, stating that no agreement could be reached regarding the "bathroom repairs."

It was argued that, because the client was thereby unable to move into the apartment as scheduled, she had the right to additionally claim the costs incurred for the additional period of residence.

There are cases in which, despite the other party's unilateral cancellation of a lease agreement, the down payment is not returned. In such cases, it is advisable to obtain the assistance of a real estate specialist attorney and recover the amount through litigation.

This firm forms execution teams of attorneys specialized in various real estate disputes, including construction, lease, and ownership matters, to actively assist clients, so please feel free at any time to request a 🔗Specialist Attorney Legal Consultation Reservation.