Top court rules against foreign embassy in property dispute

The Korea Times

The Korea Times

National

Mon, October 2, 2023 | 12:49

Law & Crime

Top court rules against foreign embassy in property dispute

Posted : 2023-05-13 09:00

Updated : 2023-05-17 08:54

The Supreme Court building in Seocho District, southern Seoul / Korea Times file

By Lee Hae-rin

When a foreign embassy occupies part of a private property, the owner cannot demand demolition of the building or transfer of the land, but is entitled to receive compensation equivalent to rent, the Supreme Court ruled, Friday.

This is the first time the Supreme Court has ruled that even when a foreign mission's occupied area is recognized as extraterritorial under international law, domestic jurisdiction can still be applied for monetary claims.

The Supreme Court recently delivered the decision in favor of a company demanding the return of undue profits from the Mongolian government, partially overturning the previous rulings which stated that the case was beyond the scope of Korean courts' jurisdiction.

The territory in dispute is the land occupied by the Mongolian Embassy in central Seoul's Yongsan District. The Mongolian government purchased the property in 1998 and has used it ever since for its embassy in Korea.

VAIV Company, formerly Daum Soft, a big data and artificial intelligence company established in 2000, purchased a property adjacent to the embassy in 2015 and later discovered around 30 square meters of its land was being occupied by the embassy's office building and warehouse.

In February 2017, the company filed a lawsuit against the Mongolian government, seeking the demolition of the building, return of the property and compensation equivalent to the unpaid rent, asserting these as undue profits.

The Seoul Western District Court rejected the company's claim in the first two trials. Occupying a territory for official use is equivalent to the foreign country's acts of sovereignty, which is exempted from the jurisdiction of another country, the court viewed.

However, the top court reversed the rulings and decided that the case needs a separate trial on the payment claim.

The Supreme Court held that when a private right to real estate is infringed, the judgement procedure on claiming undue profits does not obstruct a diplomatic mission's duties and does not affect the country's occupation of the territory.

However, the Supreme Court rejected the company's demand to demolish and return the property, clarifying that the occupation of territory for an embassy is closely related to the country's acts of sovereignty.

lhr@koreatimes.co.kr