Gwangju District Court: "Gwangsan-gu Must Refund Illegal Banner Fines Paid by Construction Company"

Gwangju District Court

[Asia Economy Honam Reporting Headquarters Reporter Park Seon-gang] The court ruled that Gwangsan-gu, Gwangju Metropolitan City, must return the illegal banner fines paid by a construction company.

According to the legal community on the 1st, the 13th Civil Division of the Gwangju District Court (Presiding Judge Song In-kyung) ruled on the 27th of last month in a lawsuit filed by a domestic construction company against Gwangsan-gu for the return of unjust enrichment, ordering Gwangsan-gu to return approximately 598 million KRW to the plaintiff, siding with the construction company.

A local housing association establishment promotion committee in Gwangsan-gu selected Company A as the business agency for the project, and Company A selected Company B as the sales agency.

The construction company submitted a letter of intent to participate in construction to Company A on November 25, 2015.

Gwangsan-gu confirmed that numerous promotional banners for the apartment project were attached along the roadside without notification or permission, and based on the names displayed on the banners, judged that the Outdoor Advertising Act was violated, deciding to impose fines totaling 1.8945 billion KRW over 22 occasions on the construction company.

Gwangsan-gu notified six fines to the construction company's headquarters and sixteen fines to Company A.

The construction company paid approximately 598 million KRW of the imposed fines from October 2016 to July 2018.

However, the construction company later filed a lawsuit against Gwangsan-gu, claiming that there was no prior notice under the Act on the Regulation of Violations of Order and no opportunity to submit opinions during the fine imposition process; that except for six cases, no fine notifications were given for sixteen cases; and that fines were imposed despite no facts of banner installation.

In response, Gwangsan-gu argued, "Prior notice was given to the construction company for six fines, and since no objections were raised, the fine notifications were lawfully sent to the construction company's address. The representative director of Company A claimed to have reached an agreement with the construction company and requested that the notification be sent to Company A, so the fine notifications were issued accordingly," adding, "Even if there were procedural defects, this does not constitute absolute invalidity."

Gwangsan-gu also claimed, "The construction company permitted Company A to use the plaintiff's name and brand during member recruitment, so the construction company knowingly tolerated and abetted the illegal banner installation, conspiring with the business agency and sales agency to install the banners, making the fine imposition lawful."

Regarding the claims of both parties, the court stated, "There is a problem with procedural defects and the misidentification of the fine recipient as the construction company, which is serious, objectively clear, and constitutes absolute invalidity."

It continued, "Gwangsan-gu claims that the fine notifications were sent after changing the address at the request or consent of the construction company, but based on the evidence and circumstances submitted by Gwangsan-gu, it is difficult to acknowledge this, and it appears that no confirmation procedures were conducted with the construction company regarding the address change."

The court explained, "The construction company merely submitted a letter of intent to participate in construction to Company A, the business agency for this project, and it is difficult to consider the construction company as the beneficiary of economic profits from member recruitment or sales of this project."

Furthermore, "There is a defect in misidentifying the fine recipient in the fine imposition decision, which violates an important part of the regulations stipulated by the Outdoor Advertising Act, making the defect serious in itself. Gwangsan-gu, had it paid a little more attention, would have known or could have known that the construction company was not the subject of the fine imposition but continued to impose fines on the construction company without changing the fine recipient and without reasonable grounds, so the defect is objectively clear," the court concluded.

This content was produced with the assistance of AI translation services.