Transfer of land under a provisional registration: win upheld on appeal

Background

Our client company signed a sale option agreement for land with a foundation, recorded a provisional registration, and paid about KRW 1.3 billion of the price on the foundation's behalf. It then exercised the option and sued for transfer of title. After our client won at first instance, the foundation appealed.

Issues and ruling

The foundation argued that the sale option was void because the board resolution appointing its then representative had been declared invalid, the land was disposed of without a board resolution, and the representative abused his authority. The court held that because the foundation had registered that person as its representative and thereby indicated his authority, it was liable under apparent authority unless it proved our client knew or could have known otherwise (Article 125 of the Civil Act). Its other grounds of invalidity were also rejected.

Outcome

The foundation's appeal was dismissed and the first instance judgment ordering transfer of title was upheld. The foundation was ordered to bear the costs of the appeal.

This is the outcome of an individual case and does not guarantee the same result in similar matters. Some facts have been generalized to protect the parties involved.