The Supreme Court of Korea rendered a judgment on May 26, 2022 that the salary peak system shall be invalid if there is no justifiable reason to discriminate elderly workers for their age, and set out the criteria to refer to when determining whether such justifiable reason exists or not.However, the judgment is not clear on whether such ruling is applicable to only the salary peak system for full-time workers or whether the ruling is applicable even if a company has introduced the salary peak system after extending the retirement age in accordance with the Act on Prohibition of Age Discrimination in Employment and Elderly Employment Promotion.Accordingly, many companies that have implemented the salary peak system are in a state of confusion as they try to come up with new ways to operate their personnel system.  Also, many employees who are subject to the salary peak system and even retirees are showing signs to commence class action lawsuits against their respective employers.

Due to the prolonged war between Russia and Ukraine, many companies that invested in or have considered investing in Russia are facing many difficulties.  Due to the economic sanctions imposed against Russia by Western countries, the global economy has shrunk and many countries are silently enduring their losses.  Barun Law seeks to hold a seminar to diagnose the current situation and future prospects for companies in Korea that are struggling to make wise management decisions and to search for ways to respond to such global situation.The seminar titled “Search for Korea-Russia Business Possibilities and Management of Business Risks” seeks to provide specific solutions concerning businesses in Russia through legal interpretation.  Barun Law hopes that the seminar can help Korean companies make better judgment concerning the risk and opportunity factors surrounding Russian businesses.  

Attorney Jung Hae-Young (Judicial Research and Training Institute, 28th) has been appointed as a member of the Police Investigation Deliberations Committee of Gyeongnam Provincial Police.His term of appointment is from May 31, 2022 to May 30, 2024

Attorney Baek Gwang-Hyeon gave a lecture on the “Practical Guide on 2022 Fair Transactions in Franchise Business Act” for employees in charge of franchise business, fair trade and antitrust and competition law, at the Fair Competition Federation (FC Hall), located in Youngdeungpo-gu, Seoul on May 17, 2022.At the lecture, he explained of the major terms of the Fair Transactions in Franchise Business Act and reviewed the amendment bill of the Enforcement Decree of the Act, shared newest example cases and provided practical guide, so that the employees in charge of fair trade in connection with franchise business can improve their response skills with respect to preventing breach of applicable laws.Attorney Baek’s lecture also dealt with the latest issues and matters concerning the amendment of the Enforcement Decree of the Fair Transactions in Franchise Business Act (provisions to be amended include those on the ratio of franchisees from whom consent needs to be obtained to carry out advertising and promotion activities, matters (information disclosure statement, etc.), which is to go into effect from July 5, 2022, case analysis, practical guides and useful tips for everyday business.  

Attorney Oh Sung-Hwan (Bar Exam, 1st) has been newly appointed as an arbitrator of the Korea Commercial Arbitration Board for the year 2022. His areas of expertise are intellectual property rights, industrial property rights, sale and purchase, hardware, and broadcasting and advertising.

Attorney Kim Do-Hyung (Judicial Research and Training Institute, 34th) has been appointed as an advisory member of the Financial Security Advisory Committee of the Financial Security Institute.Financial Security Institute newly formed the Financial Security Committee for the year 2022 with experts from the academia, industries and the legal community in order to strengthen the competitiveness of the institute as a professional agency in the area of financial security and to come up with future development strategies.In addition to Attorney Kim, the advisory committee is made up of Attorney Kim Hak-Ja of Law Firm Aone, Byun Sang-Kyung of Samsung SDS, Professor Shin Seung-Won of Korea Advanced Institute of Science and Technology (KAIST), Professor Ahn Soo-Hyun of Hankuk University of Foreign Studies (HUFS) Law School, Lee Soon-Ho of the Korea Institute of Finance (Head of Digital Finance Research Center), Professor In Hoh of Korea University (College of Informatics), Advisor Cho Sung-In of Lee & Ko, Professor Kim Ki-Beom of Sung Kyun Kwan University (Department of Forensic Science), Professor Kim Huy-Kang of Korea University School of Cyber Security, Professor Yoon Myung-Keun of Kookmin University (School of Software), Chairman Lee Dong-Beom of Korea Information Security Industry Association, Professor Cha Sang-Kil of KAIST, Professor Ko Hak-Soo of Seoul National University (College of Law), Attorney Kim Sun-Hee of Yulchon LLC, Professor Yi Ok-Yeon of Kookmin University (Department of Information Security, Cryptology, and Mathematics), Attorney Lee Jun-Hee of Yulchon LLC, Professor Chang Hang-Bae of Chung-Ang University (Department of Industrial Security), and Professor Choi Kyoung-Jin of Gachon University (Department of Law).

1. Case summaryA defendant was a franchisor operating a franchise restaurant serving coffee and sandwiches.  A plaintiff was a franchisee executing a franchise agreement with the defendant.  The plaintiff filed a claim for damages against the defendant for the reasons that the operating profits displayed on its homepage was different from the actual operating profits, and the franchisor bound the franchisee to a certain selling price without a justifiable reason. 2. The franchisee’s claimThe plaintiff asserted that it had entered into the franchise agreement on reliance of information that was disclosed on the franchisor’s homepage: the cost of raw materials accounted for about 25% of the gross sales, which constitutes an act of providing false and exaggerated information.  The plaintiff also asserted that the personnel of the defendant had refused to accept the request that the plaintiff had made several times to discuss an increase in the selling price, which constitutes an act of unreasonably restraining prices. 3. The court’s decision: the claims filed by the plaintiff are dismissed.The court excluded all the allegations made by the plaintiff and dismissed all the claims filed by the plaintiff. With regard to the allegation of false and exaggerated information, the court excluded the allegation on the ground that an exaggerated expression of advertisements may exist to the extent permitted under social norms; it is clearly indicated on the homepage of the defendant that costs and operating profits may vary depending on the operation form of respective stores; and the ratio of raw material cost reported by the other franchisees of the defendant sustains at around 30%. With regard to the allegation of unreasonable restriction to a certain price, the court admitted that the personnel of the defendant had refused to accept the plaintiff’s request for an increase in the selling price, but it was hard for the court to see that the refusal is sufficient for the court to accept the plaintiff’s allegation. 4. Our assistanceOn behalf of the defendant, we argued that the operating profits on the homepage is not significantly different from the actual operating profits reported by ordinary franchisees of the defendant on the basis of the analysis information on income and loss records of the other franchisees.  We also noted the unreasonableness of the raw material cost ratio discretionally calculated by the plaintiff.  Finally, we emphasized that in view of the expression, “Costs and operating profits may vary depending on the operation form of respective stores” on the homepage of the defendant, it cannot be interpreted in this way that the defendant will achieve profits that are exactly identical to the operating profits stated on the homepage. In addition, we argued that a franchisor’s act of recommending a franchisee to follow its pricing policy or requiring a franchisee to discuss a change or modification of a selling price in advance does not constitute an act of restricting a franchisee to a certain price. □ Attorneys in charge: Baek Gwang-Hyeon and Kim Ji-soo  

1. Case summary The client is an entity engaging in manufacturing meat processed products. It became unable to perform part of the contract under which it would supply products to the military due to the total destruction of its factory by fire. The Public Procure Service gave the client a prior notice of imposing penalties on the part of contract not performed by the client and limiting its qualification for bid participation (the “Sanction”) pursuant to the Act on Contracts to which the State is a Party (the “Act”). 2. Our roleWe actively expressed the opinion that the failure to perform part of the contract due to the destruction of the factory in a fire does not constitute the failure to perform the contract “without a justifiable reason” under the Act. In particular, we convinced the court that the client was not attributable to the fire, substantiating that the client has not been subject to any sanctions, such as being fined for negligence due to insufficient firefighting facilities or violation of fire safety standards, and that it has always fulfilled its duty of care for fire prevention. We also emphasized that the necessity of sanctions was not so great as it was difficult to see that the client’s partial nonperformance of the contract, which was caused by fire, disturbed “national contractual order.” Deliberation result of the Public Procure Service (“PPS”): PPS resolved not to impose the Sanction. The PPS resolved not to impose the Sanction of penalties and limiting qualification for bid participation on the client. This case suggests that nonperformance of a contract executed with the government due to fire could constitute a “justifiable reason” for sanctions under the Act. In particular, this case is meaningful in that it is important to aggressively substantiate that fire is not caused by the person subject to allegation. ㅁ Attorneys in charge: Baek Gwang-Hyeon and Kim Ji-su

ㅁ Case summaryIn regards to a case where heirs engaged in a dispute over property worth more than KRW80 billion, we helped the clients to resolve the dispute through settlement without litigation, reasonably persuading them about the possibility that the court would accept their claims if the case went to court.1. Who did Barun Law represent?The father, who was the decedent, gave KRW40 billion worth of property to his four children who he had with his ex-wife while he was alive. Before his death, he bequeathed assets worth KRW30 billion to his current spouse and children who he had with another wife. He died leaving about KRW 10 billion in deposit and other real estate as his inheritance estate. Shin & Kim represented the ex-wife’s children and we represented the current spouse and the other children.2. Negotiation and our roleThe father made a video in the early morning of the day when he died, in which he said his last wish that he would give the remaining deposit of KRW 9 billion to his current spouse and the children other than the ex-wife’s children. The last will did not have effect because it failed to meet requirements applicable to a bequest. However, we developed a strategy to claim that all the deposit should belong to the current spouse and the children other than the ex-wife’s children, resorting to precedents in which the effect of a gift effective upon death is claimable if a will meets elements required for a gift effective upon death even in the case where the will fails to meet requirements applicable to a bequest. We first filed an application for injunction to prevent the ex-wife’s children from disposing of the deposit in four financial institutions. Our clients were granted the injunctive relief. In addition, we sent a content-certified letter to the other banks holding part of the deposit, and persuaded them to pay the deposit to the clients. Then, we started engaging in negotiation with the ex-wife’s children about the division of inheritance property.We discussed with the other party several times the possibility that the claims made by both parties would be accepted by the court if they failed to reach an agreement and went to court to resolve the dispute while dealing with legal issues regarding the infringement of forced shares, the effect of a gift effective upon death, and the obligation to return security deposits received for real estate bequeathed by their father with the other party. We were able to help the clients to make a settlement amicably without going to court. Consequently, both parties were able to have their tax attorneys file inheritance tax returns on the relevant due date.3. ImplicationRegardless of the size of inheritance estate, a trial or lawsuit to divide inheritance property and to claim forced shares is not the only solution. This case is meaningful in that the parties can make a settlement without going to court by making a compromise after having discussions about the possibility that the claims made by them would be accepted by the court from legal and factual perspectives. This case also shows that attorneys play a critical role in the process.ㅁ Attorneys in charge: Song Bong-jun

1. Summary of factual informationA creditor (represented by us) has developed and sold a rotating bookcase for kids that has the following characteristics in form (the “Product”): The vertical frame is connected from the front and rear to the upper horizontal frame, forming a curve, and each frame is formed in the form of an integrated arch, giving a unique impression; and Books can be stored outside on both sides of each shelf, and there is a square support plate at the bottom so that the main body of the bookshelf can be rotated. Meanwhile, a debtor manufactured and sold a rotating bookshelf after the Product had been released. The debtor’s product has almost the same dimension as the Product. 2. The court’s judgement The Seoul Central District Court judged that the Product has distinguished features in terms of beauty, safety and unity that can encourage consumers to purchase it (Decision 2021Kahap21798). The court further determined that the debtor’s product is a product having practically the same form as the Product, considering that the debtor’s product shows almost the same features as the Product and the debtor’s product was released after the Product had been released.   Meanwhile, the debtor asserted that in comparing the two products, the court should compare features except for those that are customarily contained in the form of the products of same kinds, and in this case, the identical feature of the two products is denied. However, the court precluded the debtor’s assertion for the following reasons:   Since the unfair competition act prescribed in Item (i) is to protect the form of a product, the infringement of a product should be considered from the point of view whether the overall feature of the product imitates the form of another’s product, and the two products do not need to be compared and observed each other only in terms of creative elements;   The product that was manufactured by another manufacturer and presented by the debtor has only part of characteristics contained in the form of the Product, so that it is difficult for the court to consider that the Product has the form customarily held by other products of the same kind. The debtor also fails to substantiate that the third-party manufacturer’s product was released or sold earlier than the Product.   On the basis of the findings above, the court accepted the creditor’s request for interim injunction against the debtor on the premise that the debtor sold counterfeit products, which constituted the unfair competition act as prescribed in the applicable law. 3. Our role an implicationItem (i) of the Unfair Competition Prevention Act protects a product for three years, subject to the condition that the product does not have the form normally held by products of the same kind. This is intended to strongly protect useful industrial designs by prohibiting dead copy for three years regardless of originality and creativity, but it is rare for courts to accept creditors’ claims on the basis of the provision above. In other words, there are not many cases in which courts accept claims in individual cases because the courts require the significant high level of similarity in the form of a product subject to protection. In particular, the scope of protection tends to be narrowed in practice in fields where the appearance of a product can be restricted to some extent by the function of the product, such as furniture. On behalf of the furniture (bookcase) developer with an original design, we clarified that the design has distinguished features and usefulness that can promote the purchase of furniture for infants and children. By defending against the debtor's claim that the design is general or the sameness of the products should be determined by comparing part of the designs, we obtained the decision in favor of the creditor to protect the design of furniture, which is rare in the furniture industry. ㅁ Attorneys in charge: Jung Yang-hoon and Kim Dong-hyun

1. Case summary The plaintiff was a person who was transferred by a corporation (“Company A”) the permit to occupy and use the site for extraction of soil and sand by using a barge in public waters at Gijang-gun, Busan in or around April 2020 (the “Permit”). The plaintiff filed an application for extension of the Permit, which was supposed to be renewed every year, with the Chief of Gijang-gun. On December 21, 2020, the Chief rejected the application on the ground that the plaintiff did not obtain a consent from a right holder required under the Public Waters Act, and ordered the plaintiff to restore the public waters to the original condition (the “Decision”). The plaintiff retained us to file an administrative lawsuit to seek the cancellation of the Decision. 2. Issues and our roleOn December 30, 2020, the plaintiff filed a letter executed by a chief of the fishing village with Gijang-gun. The chief said in the letter that an election to choose the next chief of the fishing village was imminent and would be held on January 8, 2021, and the next chief would submit a consent. Whether it could be deemed that a right holder expressed his intent to give a consent to the plaintiff became an issue in this case. In regards to the interpretation of the letter executed by the fishing village chief, we emphasized the following matters: (i) the fishing village had never expressed an objection to the renewal of the Permit since 2014 when Company A began renewing the Permit; (ii) the fishing village chief executed a consent letter immediately after he was reelected on January 8, 2021; and (iii) given the circumstances surrounding this case, it was difficult for us to believe the content of the letter submitted by Gijang-gun to the court in which Gijang-gun alleged that the fishing village chief reversed his position. We also asserted that there would have been appropriate alternative options for the Chief of Gijang-gun such as granting time to the plaintiff as prescribed by the Public Waters Act if the fishing village chief’s intent to give a consent was uncertain, but the Chief had required the plaintiff to deal with the issue within the extremely short period of time and then had made the Decision against the plaintiff. In addition, while the plaintiff suffered from enormous damage due to the Decision, the site for extraction of soil and sand was essential to conduct the project to develop an eastern tourism complex, which was proceeded with by Gijang-gun. Thus, the Decision was incompatible with public interests. 3. The court’s decision and implications The Busan District Court accepted all the arguments made by us, and cancelled the Decision. The court determined that it seemed that there was the right holder’s consent, and therefore, there was no reason for the Chief of Gijang-gun to make the Decision and the Chief made the Decision beyond his authority. In general, since public waters owned by the state or a local autonomous government have a high level of public nature, an administrative agency is granted a high level of discretion with regard to an occupation and use permit. We were able to win the lawsuit by accurately understanding basic factual information, carefully reviewing applicable legal theories and making strong arguments. ㅁ Attorneys in charge: Noh Man-kyeong and Lee Gyu-won

1. Case summaryThe plaintiffs were people who won the bidding for land located in a development restricted area. They filed an application for a permit to construct a building on the land with the Mayor of Siheung-si in or around June 2017. The Mayor rejected the application on the ground that it was incompatible with the old Special Act on Designation and Management of Development Restricted Areas (the “Old Act”) (the “Rejection”). The plaintiffs made the primary claim for the cancellation of the Rejection as well as the preliminary claim for damages against Siheung-si. We represented Siheung-si in the lawsuit. 2. Progress and decision The plaintiffs asserted that (i) the provision of the Enforcement Decree of the Old Act that served as the basis of the Rejection [specifically, residences may be newly built on land that has been designated as land for building (“Dae” in Korean) for the time of being designated as a development restricted area (which shall be applied only to the case where the owner of the land is different from the owner of the building in the case of land on which a relocated building is constructed)] was null because it deviated from the scope of mandate granted by the parent law; (ii) the permit to relocate and construct a building that had been given by the Mayor to the former owner of the land was illegal, and therefore, the permit became null and void; and (iii) they suffered from damage due to the officials of Siheung-si who gave the illegal permit to the former owner and failed to perform the duty to change the designation of the land. The district court did not accept any claims made by the plaintiffs, but the high court affirmed part of the plaintiffs’ claims for damages on the ground that they suffered from damage due to the officials’ failure to change the land designation when they had relied on the official record and had won the bidding for the land. Both the plaintiffs and the defendant filed an appeal to the high court’ decision. The Supreme Court of Korea reversed the lower court’s decision and sent the case back to the lower court, affirming our arguments. 3. Our argument and roleWe asserted that (i) this case was not subject to exceptions, citing the history of the Old Act and the reason why the exceptions were provided under the applicable law; (ii) inability to construct a building on the land did not conflict with equality or the plaintiffs could not have sustained any damage from the inability; (iii) the permit to relocate and construct the building given to the former owner was legal; and (iv) it could not be viewed that the defendant had the duty to change the land designation according to the Old Act and the old Act on Management of Spatial Data. 4. ImplicationsThrough this case, we have clarified the scope of restrictions on development activities within the development-restricted area by blocking the way to unfairly earn gains by winning a bid for the land for which the right to relocate and construct a building was exercised in the development-restricted area. Furthermore, we were able to make the splendid achievement of having the lower court’s decision reversed and sent back to the lower court from the Supreme Court of Korea by examining the legal principles of liability for damages under the National Compensation Act caused by ommissions of public officials. ㅁ Attorneys in charge: Kim Ji-hee and Lee Gyu-won

A case involving a dispute over an inheritance estate valued at KRW 80 billion was concluded, without any lawsuit, by way of negotiations on the division of the inheritance estate. The news of this case was reported by The Maeil Business Newspaper.

The column, "The state’s liability to compensate due to wrongful administrative dispositions... how far can it be acknowledged?" written by Attorneys Kim Mi-Yeon and Choi Seung-Hwan has been published on Food News.

May 26, 2022. News Tomato reported that the salary peak system, which reduces the salary of employees who have passed a certain age, with no reasonable cause and compensation, has been declared a breach of law as the system discriminates against age and thereby invalid for being in violation of the Act on Prohibition of Age Discrimination in Employment and Elderly Employment Promotion and shared comments given by Attorney Jung Sang-Tae.

Attorney Cho Woong-Kyu’s article titled, “The SRT Lawyer” has been published in the Law Times.

The column, "Effect of general meeting of a reconstruction association that has failed to comply with the requirements for special consent” written by Attorney Lee Eung-Se has been published on DNews.

Attorney Lee Kyung-Jin's column on "Rate of division of property and matters to note" has been published in The Segye Times.