Contaminants Found at Purchased US Military Base... Court Orders State to Compensate Hyundai Steel for Cleanup Costs

A court ruling has determined that the state must compensate HDC Hyundai Development Company approximately 9.346 billion KRW for selling land of a former U.S. military base that was not properly purified.

According to the legal community on the 21st, the Civil Division 25 of the Seoul Central District Court (Chief Judge Song Seung-woo) recently ruled in favor of the plaintiff in a lawsuit filed by HDC Hyundai Development Company (hereafter HDC) against the state, claiming damages amounting to about 9.346 billion KRW.

In November 2016, HDC purchased the former Uijeongbu ‘Camp LaGuardia’ U.S. military base site from the state for over 44.6 billion KRW and planned to develop a residential-commercial complex. However, during the process of obtaining project approval, a detailed soil investigation revealed fluoride and zinc levels exceeding the concern standards under the Soil Environment Conservation Act. The project was halted, and HDC was required by Uijeongbu City’s order to carry out a contamination cleanup project. Subsequently, HDC filed a lawsuit seeking compensation from the state for the costs incurred in detailed investigation, purification, and verification.

The state argued that it had thoroughly conducted contamination investigation and cleanup when returning the land from the U.S. military and thus bore no liability for compensation. However, the court ruled in favor of HDC, stating that “the state delivered the land without purifying the contaminated soil, constituting incomplete performance of contractual obligations.”

The court pointed out that “the contamination investigation conducted by the state detected petroleum-based total petroleum hydrocarbons (TPH), but lead and fluoride were not detected,” and added that “the cleanup work cannot be considered to have been completed across the entire site.”

Furthermore, the court judged that “HDC trusted the state’s prior verification results that the contaminants had been purified and entered into the sales contract,” and noted that “while contamination in underground soil is possible in military base sites, in this case, the contamination was deep underground, making it very difficult for HDC to recognize.”