Broker and Judicial Scrivener Guarantee Claims in South Korea: When the Professional Association’s Mutual-Aid Fund Must Pay

A landlord had for years entrusted several officetel units in South Korea to a neighborhood brokerage office. One day the broker called to say that a tenant who needed cash wanted to switch to monthly rent and asked the landlord to send the difference in the deposit. The landlord sent the money. Similar requests followed 15 times over six years, but the tenants had never asked for any such change.

The broker was sentenced to prison in a criminal case. The landlord sued the broker together with the Korea Association of Realtors, which provides the broker’s mandatory liability guarantee. The association refused to pay, pointing to a clause in its terms that excludes losses caused by property management services, and the first and second instance courts agreed. On August 13, 2026, the Supreme Court of Korea reversed (Supreme Court of Korea, August 13, 2026, 2025Da217842).

Starting from that decision, this article explains in general terms what a person who suffers a loss through a licensed broker or a judicial scrivener in South Korea can recover from the professional association’s mutual-aid guarantee. We reviewed 14 Supreme Court decisions, 12 lower court decisions and the relevant statutes in their original Korean text. The content is relevant to landlords, tenants, buyers, and anyone who uses a judicial scrivener for property registration in South Korea.

Who pays when a broker or judicial scrivener causes a loss in South Korea?

In the first place, the broker or scrivener does. A practicing licensed broker who, while brokering, intentionally or negligently causes property damage to a transacting party must compensate it (Article 30(1) of the Licensed Real Estate Agents Act), and a judicial scrivener who intentionally or negligently causes property damage to a client while performing professional work must compensate the client (Article 26(1) of the Certified Judicial Scriveners Act).

The two provisions look similar but protect different people. The broker statute protects “transacting parties,” which includes not only the party who engaged the broker but also the counterparty. The Supreme Court of Korea held that brokerage covers arranging a transaction at the request of only one party, not just at the request of both (Supreme Court of Korea, September 29, 1995, 94Da47261). The scrivener statute, by contrast, concerns liability to the “client” who entrusted the work. Section 7 returns to this difference.

The office is also responsible for its staff. Under the broker statute, the business acts of an affiliated licensed agent or a brokerage assistant are deemed to be acts of the practicing broker who employs them (Article 15(2)). The scrivener statute has no such deeming rule; instead it makes the scrivener responsible for guiding and supervising office staff (Article 23(3)), and a victim may claim vicarious liability under Article 756 of the Korean Civil Act.

The broker minimums above took effect on January 1, 2023. Before that, the minimum was KRW 100 million for an individual broker and KRW 200 million for a corporation (former Article 24(1) of the Enforcement Decree; Addenda to Presidential Decree No. 32306, December 31, 2021, Article 1).

What if the broker or scrivener cannot pay?

The victim turns to the guarantee the broker or scrivener was required to obtain. Both must obtain guarantee insurance or join the association’s mutual-aid scheme before starting business (Article 30(3) of the Licensed Real Estate Agents Act; Article 26(2) of the Certified Judicial Scriveners Act), and the victim may claim directly against the association.

Coverage is mandatory and must be disclosed

In the 2026 decision, the Supreme Court of Korea noted that a broker who starts business without the required security may have his or her office registration cancelled, and that a broker who fails, on completion of a transaction, to explain the guaranteed amount, the guarantor and the coverage period and to provide a copy of the certificate may be fined up to KRW 1 million. On that basis it described the statute as compelling security such as joining the mutual-aid scheme for liability under Article 30(1) (Supreme Court of Korea, August 13, 2026, 2025Da217842; Article 30(5)). A judicial scrivener must not practice without the required security, and the chief judge of the district court may suspend a scrivener who does (Article 26(3) and (4) of the Certified Judicial Scriveners Act).

The guarantee works like surety insurance

The association’s mutual-aid scheme guarantees the broker’s liability to the victim. The Supreme Court of Korea has described it as a system in the nature of surety insurance that guarantees the liability a broker incurs toward transacting parties through tort or breach of contract (Supreme Court of Korea, September 27, 2012, 2010Da101776). This leads to results that differ from ordinary insurance.

• Intentional misconduct is covered. Ordinary insurance excludes intentional acts, but the Supreme Court of Korea held that terms covering incidents caused by the broker’s intentional acts do not contradict the nature of the scheme (Supreme Court of Korea, September 29, 1995, 94Da47261). That is why a broker’s fraud or embezzlement can be covered.
• Victims are protected even if the broker obtained coverage by deceiving the association. Even where the association rescinds the contract or invokes a voidness clause because of the broker’s deception, it cannot assert this against a transacting party unless that party knew or could have known of the deception (Supreme Court of Korea, September 27, 2012, 2010Da101776).

For the judicial scriveners’ scheme, lower courts, citing a 2013 Supreme Court decision as precedent, have likewise treated it as a system in the nature of surety insurance and held that a client may claim directly from the association in a position similar to the insured under insurance for the benefit of a third party (Ulsan District Court, March 12, 2024, 2022Gadan106995; to the same effect, Seoul Central District Court, April 29, 2026, 2025Gadan97197). We could not locate the text of that Supreme Court decision in public databases.

How is a claim made?

To receive payment under a broker’s guarantee, the claimant applies to the association with a settlement agreement with the broker, a court settlement record, a copy of a final judgment or a similar document (Article 26(1) of the Enforcement Decree). If the broker disputes liability, victims in practice sue the broker and the association together, as the landlord did in this case (Gwangju District Court, January 9, 2025, 2024Gahap53937). For judicial scriveners, the association’s compensation rules cited in a court decision required the claimant to prove the claim with an enforceable title such as a final judgment, or with an agreement reached before the local scriveners’ association dispute mediation committee (Seoul Central District Court, February 17, 2022, 2020Gadan524446).

What counts as “brokerage” and as a scrivener’s “professional work”?

The guarantee covers only losses arising from brokerage or from a scrivener’s professional work, so this is where disputes are usually decided. The Supreme Court of Korea held that whether an act is brokerage is determined not by the broker’s subjective intent to genuinely arrange a deal but by whether, viewed objectively, the act is recognized under common social understanding as arranging or brokering a transaction (Supreme Court of Korea, September 29, 1995, 94Da47261).

It is brokerage even if the broker meant to cheat from the start

In that case, the broker had no mandate from the landowner but persuaded a buyer that cheap land was available, took the buyer’s instructions, drew up a sales contract and collected money on the pretext of forwarding the price to the owner. The Supreme Court of Korea treated this as damage caused in the course of brokerage (Supreme Court of Korea, September 29, 1995, 94Da47261). What matters is the outward act, not the broker’s hidden intent.

Acts after signing can be brokerage too

The Supreme Court of Korea held that where a broker who arranged a lease is expected to stay involved after signing, for example in paying the deposit, handing over the premises or obtaining a fixed-date stamp, so that the parties’ obligations are performed smoothly, those acts fall within brokerage (Supreme Court of Korea, April 11, 2013, 2011Da68609). A broker who received part of a purchase balance and fled instead of passing it to the seller was likewise found to have caused the loss in the course of brokerage (Supreme Court of Korea, October 7, 2005, 2005Da32197).

Brokerage combined with property management is still brokerage

This is the key point in the 2026 case. The broker statute allows a brokerage corporation to also provide “property management services such as rental management of commercial buildings and housing” (Article 14(1)(1)). The Supreme Court of Korea upheld a lower court ruling that, because such management is closely related to brokerage and in practice often takes place together with or right after it, brokerage includes brokerage carried out together with property management (Supreme Court of Korea, April 11, 2013, 2011Da68609). In that case, a person who ran a brokerage office using a licensed broker’s name and had been given full authority by a building owner to lease the property and collect payments was found to have brokered when collecting deposits from tenants, and both the licensed broker who lent the name and the association were held liable (Supreme Court of Korea, April 11, 2013, 2011Da68609).

In another case where a brokerage assistant handling multi-unit house management and lease brokerage embezzled money meant for returning deposits to existing tenants, the Supreme Court of Korea upheld the finding that the broker and the association were liable (Supreme Court of Korea, April 28, 2022, 2019Da212273).

A scrivener’s work is measured by what was entrusted

A judicial scrivener’s work consists of matters entrusted by others, such as preparing and filing registration and deposit documents, acting in bids at court auctions and public sales, filing individual bankruptcy and rehabilitation petitions, and related consultation and advice (Article 2(1) of the Certified Judicial Scriveners Act). Liability and the guarantee arise within the scope of the work actually entrusted.

Courts have sometimes read that scope broadly. Where a scrivener advising a client on a personal bankruptcy filing persuaded the client to take out loans in the spouse’s name and hand them over for investment, taking KRW 99.5 million, and took KRW 35 million from another client by recommending an investment during auction advice, the court found the fraud occurred in the course of acting for, advising and consulting on the bankruptcy and auction matters and ordered the association to pay (Ulsan District Court, March 12, 2024, 2022Gadan106995). The Supreme Court of Korea also reversed a ruling that had denied the liability of a scrivener who, while handling a registration, issued a written undertaking to take responsibility for managing the purchase price until the ownership transfer was completed, and it reversed the dismissal of the claim against the association together with it (Supreme Court of Korea, December 27, 2012, 2010Da57473). That decision did not, however, rule on the scope of the guarantee itself.

Does a “we do not cover” clause in the guarantee terms end the matter?

No. The association’s guarantee terms are standard terms, so the interpretation rules and invalidity provisions of the Korean Act on the Regulation of Terms and Conditions apply. Standard terms must be interpreted fairly under the principle of good faith and not differently from customer to customer, and where their meaning is unclear they must be interpreted in the customer’s favor (Article 5).

How Korean courts read standard terms

The Supreme Court of Korea has held that standard terms must be interpreted objectively and uniformly based on what an average customer can understand, and that the meaning of a particular clause must be assessed not only from its wording but also from its place in the overall logical context of the terms (Supreme Court of Korea, October 14, 2021, 2018Da279217). The 2026 decision repeated this rule (Supreme Court of Korea, August 13, 2026, 2025Da217842). The same precedent adds that if a clause still allows more than one reasonable reading after this process it is read in the customer’s favor, but if it allows only one reading there is no room to do so (Supreme Court of Korea, October 14, 2021, 2018Da279217).

The fact that coverage is required by law also matters. The Supreme Court of Korea held that where a clause allows more than one reasonable reading, and particularly where insurance is compulsory by law, courts should also consider the legislative purpose of protecting customers and transacting parties through insurance and interpret the clause in their favor (Supreme Court of Korea, September 27, 2012, 2010Da101776).

Broad wording can be read narrowly

A well-known example is the unlicensed-driver exclusion in Korean auto insurance. The Supreme Court of Korea sitting en banc held that applying the clause literally to every unlicensed driver would leave even an owner whose car was stolen without coverage, and narrowed it to cases where the unlicensed driving occurred in circumstances the policyholder or insured could control (Supreme Court of Korea (en banc), December 24, 1991, 90Daka23899). Courts cut away the part of an exclusion that would be unfairly disadvantageous to customers if read literally.

Otherwise the clause is invalid

A standard term that violates good faith and loses fairness is invalid, and a term that is unfairly disadvantageous to the customer or restricts essential rights to the point of defeating the purpose of the contract is presumed unfair (Article 6). A term that limits the business’s liability for damages or shifts its risks to the customer without reasonable grounds is also invalid (Article 7(2)).

The realtors’ association’s exclusions

The Korea Association of Realtors’ terms in this case listed the following as losses it would not cover in Article 7 (Gwangju District Court, January 9, 2025, 2024Gahap53937).

1. Liability for losses caused by war, revolution, insurrection, civil unrest, terrorism, riots, natural disasters and similar events
2. Losses caused by property management services such as rental management of commercial buildings and housing under Article 14(1)(1) of the Act
3. Losses from trading things or rights that are not brokerage objects (such as unspecified apartment pre-sale rights)
4. Losses from explanations beyond the statutory confirmation and explanation duties, or from special undertakings by the broker
5. Losses from brokerage acts prohibited under Article 33 of the Act

Lower courts have read item 5 narrowly as well. One court held that item 5 cannot be enforced where the broker engaged in the prohibited act in Article 33(1)(4) of the Act, misleading a client with false statements about important matters of the transaction, because excluding such losses would exempt the association from most brokerage incidents and would relieve it of liability precisely where the broker’s conduct was most wrongful (Daegu District Court, August 9, 2024, 2023Gadan133077).

What did the 2026 Supreme Court decision change?

The Supreme Court of Korea held that the property-management exclusion in Article 7(2) of the association’s terms merely confirms that losses from purely managerial work that is not “brokerage” are not covered. Where management and brokerage are carried out together and the broker is liable under Article 30(1), the exclusion does not apply. It reversed the lower court on that basis (Supreme Court of Korea, August 13, 2026, 2025Da217842).

Background

The first instance court found the following facts (Gwangju District Court, January 9, 2025, 2024Gahap53937).

Separately, B embezzled KRW 49.2 million from money received to return the remaining deposits of two tenants whose leases had ended. B had renewed one-year guarantee contracts with the association with a limit of KRW 100 million each year from December 2, 2019 to December 1, 2023, and the limit for January 1 to December 1, 2023 was KRW 200 million. A sued B for damages and claimed KRW 529.85 million from the association, calculated by applying the yearly limits (Gwangju District Court, January 9, 2025, 2024Gahap53937).

Why the lower courts sided with the association

The first instance court ordered B to pay KRW 596,819,715 but dismissed the claim against the association. It reasoned that no switch to monthly rent ever took place and B simply lied to obtain money, so the loss did not arise from brokerage and was rather a loss from property management (Gwangju District Court, January 9, 2025, 2024Gahap53937). The appellate court took a partly different view. It held that the rent-switch requests were, outwardly, acts aimed at arranging the mutual termination of existing leases and new or amended leases, so they fell within brokerage even if B never meant to broker anything. But because B committed the acts while managing the units and exploiting A’s trust, it held the loss excluded under Article 7(2) and dismissed the appeal (Gwangju High Court, September 18, 2025, 2025Na20642). Earlier lower court decisions had applied the exclusion in the same broad way (Busan High Court, February 8, 2023, 2022Na50468).

The Supreme Court’s reasons

1. The Licensed Real Estate Agents Act compels security, such as joining the mutual-aid scheme, for liability under Article 30(1), and the scheme is in the nature of surety insurance guaranteeing that liability.
2. Article 6 of the association’s own terms states that the broker’s liability under Article 30(1) is what is covered.
3. Brokerage under Article 30(1) includes brokerage carried out together with property management, so losses from management work that amounts to brokerage must be covered. The exclusion is therefore read, objectively and uniformly, as applying only to purely managerial work.
4. A contrary reading would force brokers who joined the scheme to obtain separate insurance or make a deposit to avoid breaching the law, and would leave a gap in protecting transacting parties who relied on the coverage, a result the Court described as contrary to the purpose of the scheme.
5. If the clause were meant to exclude brokerage that gives rise to liability under Article 30(1), it would breach the statute that compels the security and be invalid as unfairly disadvantageous to customers (Article 6(1) and (2)(1) of the Act on the Regulation of Terms and Conditions).

The Court also said that the association may not, absent special circumstances, arbitrarily exclude some types of a broker’s Article 30(1) liability from coverage (Supreme Court of Korea, August 13, 2026, 2025Da217842). The interpretation rules and invalidity provisions discussed in Section 4 lead directly to this result.

What the decision left open

In sending the case back to the Gwangju High Court, the Supreme Court distinguished two parts. Taking money on the pretext of rent switches is likely to be brokerage, but embezzling money while returning deposits to tenants whose leases had ended may or may not be brokerage depending on whether it was done to arrange a new lease, which the lower court must examine (Supreme Court of Korea, August 13, 2026, 2025Da217842). The final amount payable will depend on the remand judgment.

Where the exclusion came from

The clause was not always there. According to a lower court decision, after the Supreme Court held the association liable for brokerage carried out together with property management (Supreme Court of Korea, April 11, 2013, 2011Da68609), the association amended its terms on December 27, 2013 (effective January 1, 2014) to add the property-management exclusion to Article 7 (Suwon District Court, May 12, 2022, 2021Na56473). The 2026 decision confines the clause to management work unrelated to brokerage.

What is “purely managerial” work?

It is management work not connected to brokerage. The 2026 decision held that even handling the return of deposits to tenants whose leases have ended may or may not be brokerage depending on whether it serves to arrange a new lease (Supreme Court of Korea, August 13, 2026, 2025Da217842). Read together with earlier precedent that involvement in performing a lease after signing, such as paying the deposit, also counts as brokerage (Supreme Court of Korea, April 11, 2013, 2011Da68609), the key question is whether the act in dispute was tied to arranging a lease or to performing it.

Cases where losses during property management were covered

• A brokerage corporation’s representative who had been given authority only to manage a building and sign monthly-rent leases signed jeonse leases with tenants without authority and kept the deposits. The court rejected the association’s argument that this was mere management, not brokerage, and treated it as brokerage (Seoul High Court, October 20, 2010, 2010Na44837). In another victims’ case involving the same representative, the Supreme Court of Korea rejected all of the association’s grounds of appeal on voidness of the contract, the coverage limit and comparative fault, and upheld the order to pay (Supreme Court of Korea, August 17, 2012, 2010Da93035).
• In a case where building owners left the entire lease process to a brokerage assistant who embezzled over several years, the Supreme Court of Korea accepted the lower court’s finding that the broker who employed the assistant and the association were jointly liable, but reversed and remanded the judgment because the lower court failed to take the owners’ own negligence into account (Supreme Court of Korea, July 14, 2011, 2011Da21143).

A case treated as purely managerial

In a lower court case decided before the 2026 decision, an owner had given comprehensive authority to sign jeonse and monthly-rent leases for individual units to a person using a borrowed broker’s license, had taken no part in the individual leases, and there was no record of brokerage fees being paid. The court found the arrangement was a management mandate, not brokerage between owner and tenants, and denied the owner’s claim for leases governed by the amended terms (effective January 1, 2014). For two leases signed in 2013 under the earlier terms, however, it treated the owner’s losses as covered and awarded KRW 39 million, representing the insured broker’s 50 percent share of fault (Suwon District Court, May 12, 2022, 2021Na56473). The amendment of the terms decided the outcome.

In short, entrusting management to a brokerage office does not by itself bar recovery. What matters is how the office arranged leases and handled deposits, and which lease the money in question was tied to. Useful evidence includes the property confirmation and explanation statements and the broker’s details on the lease contracts, bank records showing where deposits went, and text messages and call records.

How does the judicial scrivener guarantee differ?

The main differences concern “clients” and “office staff.” The scriveners’ guarantee covers losses suffered by a person who entrusted work to the scrivener, arising while that work was being done, and the scrivener statute has no rule like Article 15(2) of the broker statute that deems staff acts to be the scrivener’s own.

No mandate, no guarantee

Courts read Article 26(1) of the Certified Judicial Scriveners Act literally: if the scrivener was not entrusted with work, or the person who suffered the loss is not the client, liability under that provision does not arise. A court therefore held that a scrivener’s vicarious liability under Article 756 of the Civil Act for an employee’s tort does not by itself oblige the association to pay (Seoul Central District Court, June 19, 2014, 2014Gadan14335). In that case the office manager had taken KRW 100 million by falsely promising to repay a loan for setting up a company, and the victim had entrusted no work to the scrivener (Seoul Central District Court, June 19, 2014, 2014Gadan14335). Another court reached the same conclusion where an unregistered staff member was involved in a fraudulent land sale using an account in the scrivener’s name, because there was no evidence that the victim had entrusted the ownership transfer registration to the scrivener (Seoul Central District Court, April 29, 2026, 2025Gadan97197).

Losses caused by office staff: lower courts are divided

The second court contrasted the broker statute, which deems the business acts of assistants to be the broker’s own, with the scrivener statute and guarantee terms, which contain no such rule (Seoul Central District Court, August 18, 2023, 2019Gahap524766). We found no Supreme Court decision resolving this question (search of the Korea Law Information Center and superlawyer as of October 21, 2026). The common thread is how the loss connects to the scrivener’s own performance of the entrusted work.

The limit is an annual total per scrivener

The Korea Judicial Scriveners Association’s compensation rules cited in a court decision capped payments at KRW 200 million per member per year, and the court read this as a total cap for all incidents in a year (Seoul Central District Court, March 31, 2021, 2020Gadan5311056). In that case, the association deposited KRW 200 million with the court for the victims of one scrivener’s embezzlement of registration costs, and the victims shared it in proportion to their losses (Seoul Central District Court, March 31, 2021, 2020Gadan5311056). Where one scrivener has several victims, acting early matters.

A scrivener’s core duty: identity verification

Many scrivener liability cases concern the duty to confirm that the client is who he or she claims to be. The statute requires a scrivener to verify the client or the client’s agent through a resident registration card, certificate of seal impression or similar documents and to record the method in the case register (Article 25). The Supreme Court of Korea held that where a person claiming to be the registered owner produces no original official identification at all, the scrivener must verify identity even more thoroughly by every available means. It upheld the scrivener’s liability in that case, while assigning 50 percent of the fault to the lender, which had hastily made a large loan (Supreme Court of Korea, September 8, 2006, 2006Da24407).

Can a victim recover the full amount?

Three questions decide this: whether the victim’s own fault reduces the award, what the limit is, and whether the limitation period has run.

Comparative fault depends on who acted intentionally

The Supreme Court of Korea held that a person who intentionally commits a tort by exploiting the victim’s carelessness cannot ask to have liability reduced because of that very carelessness, and that comparative fault cannot be applied in a guarantee claim based on the broker’s fraud or embezzlement (Supreme Court of Korea, October 7, 2005, 2005Da32197). The position differs when only an assistant acted intentionally. The Court held that if a victim suing a broker who merely employed the assistant and did not join the wrongdoing was at fault, the court must take that into account (Supreme Court of Korea, July 14, 2011, 2011Da21143). The building owners in that case had left the entire lease process to the assistant without checking the lease terms with tenants, even though rent had not been paid properly for a long time (Supreme Court of Korea, July 14, 2011, 2011Da21143). The Court also upheld a 30 percent reduction for the victim’s fault in another case of an assistant’s embezzlement (Supreme Court of Korea, April 28, 2022, 2019Da212273).

In the 2026 case, the association argued that its liability should be limited to 10 percent or less because the landlord had not checked the changes directly with the tenants and had sent the deposits to the broker’s account rather than the tenants’ (Gwangju District Court, January 9, 2025, 2024Gahap53937). The lower courts did not reach this argument because they dismissed the claim against the association, so it may be argued again on remand.

Limits: the certificate amount, and whether it is a total cap

Payment cannot exceed the amount on the guarantee certificate. The Supreme Court of Korea once read the association’s earlier clause, under which the amount it pays is limited to the amount of coverage, as a limit per incident (Supreme Court of Korea, September 27, 2012, 2010Da101776). From January 1, 2009, however, the terms were amended to provide that the total compensation limit for incidents during the coverage period is the amount on the certificate, and on November 18, 2009 the association’s mutual-aid rules were amended to add that the total limit means the sum of all payments to injured clients regardless of the number of clients, transactions or the size of the losses (Seoul High Court, October 20, 2010, 2010Na44837). The wording that applies today must be checked in the certificate and terms for the relevant coverage period.

Because coverage is usually renewed annually, it matters which coverage period an incident falls into when a fraud spans several years. The landlord in the 2026 case calculated the claim by applying each year’s limit (Gwangju District Court, January 9, 2025, 2024Gahap53937).

Limitation period: three years, as for insurance claims

The Korean Commercial Act provides that a claim for insurance proceeds lapses if not exercised for three years (Article 662) and applies this to mutual-aid arrangements (Article 664). Before the amendment effective March 12, 2015, the period was two years. The Supreme Court of Korea applied Article 662 to claims under a mutual-aid scheme similar to mutual insurance (Supreme Court of Korea, March 28, 1995, 94Da47094). The period generally runs from the incident, but where the claimant could not objectively know of it, the period runs from when the claimant knew or could have known of the incident (Supreme Court of Korea, September 27, 2012, 2010Da101776). A damages claim against the broker or scrivener personally is governed separately by the Civil Act’s limitation rules for torts: three years from learning of the damage and the wrongdoer, and ten years from the wrongful act (Article 766).

What should landlords, tenants and clients do?

Landlords entrusting management

• Define the mandate in writing. Separate the authority to sign leases, collect deposits, return deposits and pay maintenance costs, and require your confirmation for anything that moves money, such as switching a jeonse lease to monthly rent or changing a deposit.
• Have deposits and rent paid directly into your own account, and return deposits directly to tenants’ accounts. In the 2026 case, the association pointed to the landlord’s transfers to the broker’s account, rather than the tenants’, as the landlord’s fault (Gwangju District Court, January 9, 2025, 2024Gahap53937).
• When told that a lease is changing, confirm directly with the tenant. Failing to check for a long time can reduce the payout (Supreme Court of Korea, July 14, 2011, 2011Da21143).
• Leaving everything to the office can also make you liable to tenants. The Supreme Court of Korea held a landlord who had left officetel leasing to a brokerage office for years without checking vicariously liable to a tenant, after a brokerage assistant authorized only to sign monthly-rent leases forged a jeonse lease and took the tenant’s KRW 75 million deposit (Supreme Court of Korea, February 11, 2022, 2021Da283834).

Tenants and buyers at signing

• Keep the copy of the guarantee certificate (or guarantee insurance policy) the broker provides. On completing a transaction, the broker must explain the guaranteed amount, the guarantor and the coverage period and provide a copy of the certificate (Article 30(5) of the Licensed Real Estate Agents Act).
• Pay deposits and balances to the account of the landlord or seller named in the contract. Where it is unclear who should receive the deposit, as with trust-held property, see Who Repays the Deposit on Trust-Held Property in South Korea?
• For a broker’s liability when it only drafted a contract without actually brokering, see Broker Liability for Fake Leases in South Korea.

Clients of judicial scriveners

• Keep written records (power of attorney, receipts) of what you entrusted. Because the scriveners’ guarantee presupposes a mandate, victims who could not prove one have been denied payment (Seoul Central District Court, June 19, 2014, 2014Gadan14335; Seoul Central District Court, April 29, 2026, 2025Gadan97197).
• Check that registration costs, acquisition tax and balances go to an account in the scrivener’s name, not an office manager’s personal account.
• Decline money proposals unrelated to the registration, especially offers to grow your money or invest it. Coverage has been recognized in some cases (Ulsan District Court, March 12, 2024, 2022Gadan106995), but losses found unrelated to the scrivener’s work are hard to recover.

When a loss is discovered

1. Identify the guarantee or insurance the broker or scrivener holds (guarantee certificate, inquiry to the association).
2. File a criminal complaint and a civil damages claim. Suing the association as a co-defendant allows the broker’s liability and the association’s duty to pay to be decided together.
3. Prepare the claim documents, such as a settlement agreement or judgment, and claim from the guarantee (Article 26(1) of the Enforcement Decree).
4. Move quickly with the limitation period and limits in mind. A three-year period may apply to the guarantee claim (Articles 662 and 664 of the Commercial Act), and under a total-cap model several victims must share the limit.

What does this mean for foreign companies and residents in IFEZ?

Foreign companies and residents in the Incheon Free Economic Zone (IFEZ), including Songdo International Business District, Cheongna International City and Yeongjong International City, often rely on local brokerage offices to lease, manage or buy property and on judicial scriveners for registrations. The same rules apply to them as to Korean nationals.

• Foreign owners who leave officetel or apartment units with a local office should put the scope of the mandate in writing and keep deposits and rent flowing directly between their own accounts and tenants’ accounts. The 2026 decision helps owners whose broker both brokered and managed, but losses from purely managerial work remain outside the realtors’ guarantee (Supreme Court of Korea, August 13, 2026, 2025Da217842).
• Foreign tenants should keep the guarantee certificate the broker provides at closing (Article 30(5) of the Licensed Real Estate Agents Act); it identifies the guarantor and the coverage period needed to make a claim.
• When using a judicial scrivener for a purchase registration or company-related filing, make sure the mandate is documented and that funds go to the scrivener’s own account, because the scriveners’ guarantee depends on the mandate (Seoul Central District Court, June 19, 2014, 2014Gadan14335; Seoul Central District Court, April 29, 2026, 2025Gadan97197).

Frequently asked questions

This article summarizes Korean court decisions and statutes on the liability of licensed real estate brokers and judicial scriveners and on professional association guarantees, based on published judgments, and is not legal advice for any particular case. The 2026 Supreme Court decision remanded the case, so the amount payable will be decided by the Gwangju High Court. The associations’ guarantee terms and rules may be amended, so in an actual case the terms for the relevant coverage period should be checked. Please consult Atlas Legal about your specific situation.

About the Author

Taejin Kim | Managing Partner

Corporate Counseling, Corporate Disputes, White-Collar Crime

Former Public Prosecutor | Judicial Research and Training Institute, 33rd Class

Korea University LL.B. & LL.M. (Criminal Law), University of California, Davis LL.M.

Atlas Legal | Incheon Songdo, South Korea

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