Supreme Court: Redevelopment Association Members Have No Obligation to 'Attend General Meeting in Person'

Court: "Within the scope that does not hinder voting rights, implementation also applies when a proxy attends"

[Asia Economy Reporter Heo Kyung-jun] The Supreme Court has ruled that members of an urban environment maintenance project association are not required to be physically present at the general meeting. If a member exercises their voting rights through a proxy, it should be considered as if they attended in person.

The Supreme Court's First Division (Presiding Justice Kim Seon-su) announced on the 7th that it overturned the lower court's ruling in favor of Mr. A in the appeal case he filed against the Mayor of Cheonan regarding the invalidation of the approval for the establishment of the urban environment maintenance association, and remanded the case to the Daejeon High Court.

In February 2015, the Urban Environment Maintenance Project Association Promotion Committee in Cheonan, Chungnam, held a general meeting and applied for approval to establish the association to implement the urban environment maintenance project in July of the same year, receiving approval from the Mayor of Cheonan.

However, some members filed a lawsuit in November 2017 claiming that the exercise of voting rights through proxies was invalid and that there were errors in the number of consenting landowners, and the court adjusted the number of consenting members, calculating the final consent rate at 75.8% (398 out of 525). The ruling was later finalized.

Mr. A then filed a lawsuit in September 2019 seeking invalidation of the approval for the establishment of the association. The key issue in the trial was Article 24, Paragraph 5 of the former Urban Maintenance Act. This provision, applied at the time, stipulated that at least 20% of the members must be physically present at the general meeting. Article 24, Paragraph 5 of the former Urban Maintenance Act was later amended to Article 45, Paragraph 7, which explicitly allows members to exercise voting rights through proxies if they submit a family power of attorney or reside overseas, and in such cases, the member is considered to have attended in person.

The first trial court dismissed the plaintiff's claim, but the second trial court ruled that "direct attendance" under the former Urban Maintenance Act means the landowner themselves must appear at the meeting, and proxy attendance does not qualify, thus invalidating the approval for the establishment of the association.

However, the Supreme Court overturned the second trial court's ruling, stating that "direct attendance" includes cases where a proxy attends and exercises voting rights. The court explained, "The purpose of the direct attendance requirement in the provision is to address the issue where a general meeting could be held with only a very small number of members attending by considering voting rights exercised in writing as 'attendance,' and to ensure that the members' intentions are clearly reflected."

Furthermore, the court stated, "This legislative intent does not require the member to attend in person to be fulfilled," and added, "It can also be realized when a proxy attends and exercises voting rights within the scope that does not hinder the proper exercise of voting rights."

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