Suwon Civil Attorney | Suwon Attorney Helps Client Recover the Full Amount of Development Investment Funds Unpaid for Three Years

The client participated as an investor in a commercial facility development project carried out by a construction development company.

At the time of the contract, the company promised stable rental income and pledged to return the investment funds upon termination of the contract.

However, after the purchase, the situation persisted in which the client could not recover not only the rental income but also the principal of the investment, resulting in a significant financial loss to the client.

In fact, the defendant initially built trust by paying rental income to investors, but fell into serious financial difficulties beginning in 2021.

The defendant stopped paying the investment funds and repeatedly told investors to "wait until the management situation improves," but no substantive measures were taken.

Despite protests from some investors, the company evaded responsibility, citing internal circumstances.

The attorney filed a lawsuit against the defendant for the return of the investment funds.

Through the complaint, the attorney made clear that the company had not performed its obligation to pay the agreed rental income and to return the principal of the investment, and on that basis filed a lawsuit seeking the return of the unpaid amounts.

The special terms of the lease agreement that the client initially drew up contained an agreed provision stating, ‘guaranteed rental income shall be paid.’

It is reasonable to view this as an agreement to guarantee returns within the guarantee period, so that where the amount falls short of each stated figure, there is an obligation to pay the difference on the last day of each month.

In addition, the special terms of the lease agreement stated that "rent shall be paid even if a vacancy arises during the term of the income certificate."

This means that the defendant would guarantee a minimum rent, and even if the unit was not leased, would pay the rent so as to guarantee the returns.

In fact, according to precedent (Incheon District Court, judgment of May 17, 2019, Case No. 2018Gahap57062), with respect to the portion in which the plaintiffs entered into lease agreements with tenants and received rent, the court held that this meant that the defendant company would not pay twice, not that the defendant company would not guarantee the returns where the plaintiffs entered into lease agreements, and that it could not be interpreted as such.

The defendant agreed that if the client lent 300 million won in loaned money in connection with the construction at issue in this case, the defendant would repay it within three months after completion.

However, even when the due date arrived, the defendant did not return the loan to the client.

In fact, the client requested return of the principal and the unpaid interest on several occasions, but the defendant ignored these requests and did not comply.

At the time the investment agreement was originally drawn up, the defendant had agreed to repay the entire amount remitted by the plaintiff and to pay the plaintiff a fixed sum each month, and had also agreed to pay interest and delay damages.

However, it came to light that the defendant delayed payment, claiming that its cash flow had deteriorated due to a project financing loan issue, and urged additional investment in order to secure cash flow.

According to Supreme Court precedent, where there is no agreement on interest after the due date in a loan for consumption, absent a special manifestation of intention, it is the intention of the parties that the originally agreed interest will continue to be paid even after the due date has passed(Supreme Court, judgment of September 8, 1981, Case No. 80Da2649).