Seoul City Wins Lawsuit Over 7.3 Billion KRW Double Compensation for River Losses

Final Supreme Court Victory on the 'River Incorporation Land Compensation Act'
"Sellers of River Incorporated Land Are Not Subject to the Compensation Act"
Seoul City: "We Will Thoroughly Legally Respond to Double Compensation"

Seoul City announced on the 9th that it has won the final victory in a lawsuit related to the River Incorporation Land Compensation Act, which requires compensation for land near rivers incorporated into the state. Following this ruling, Seoul City can prevent unreasonable budget expenditures caused by double payment of compensation, and it is expected to win in 76 similar ongoing lawsuits.

In the lawsuit, the plaintiffs claimed approximately 7.3 billion KRW in river land loss compensation from Seoul City for the same land, despite their predecessors having sold the river-incorporated land to third parties and received the sale proceeds.

The lower court ruled that the sale of land after it was nationalized due to river incorporation was invalid, recognizing the plaintiffs, who are heirs of the seller before the sale, as the rightful recipients of the loss compensation, and fully granted their compensation claims.

The right to claim loss compensation under Article 2 of the River Incorporation Land Compensation Act is a provision for landowners whose land was incorporated into river zones and nationalized under previous river laws but lacked compensation regulations or whose claims expired due to the statute of limitations. It was enacted to have the state compensate losses through city or provincial governors as a reflective consideration and a means of protecting citizens' rights, but only for landowners who did not receive compensation. Despite this intent, the lower court’s recognition of the plaintiffs as rightful claimants led to an unreasonable result where the state and local governments, as compensation providers, had to pay loss compensation twice to both buyers and sellers.

However, the Supreme Court’s ruling was different. On the 30th of last month, Seoul City received a judgment stating that "since a considerable period has passed since the sale of the river-incorporated land and there is no risk of the buyer reclaiming the sale price, the seller, having obtained satisfaction as the owner, cannot be considered to have suffered special sacrifice or loss and therefore cannot claim loss compensation."

Loss compensation is a regulatory property compensation conducted from the perspective of guaranteeing private property rights and overall equitable burden for special sacrifices or losses incurred by individuals. To receive loss compensation, the individual must have suffered special sacrifice or loss. In particular, if the individual has sold the subject land and received the sale price as consideration for ownership transfer, effectively exercising all rights as the owner, it is considered that no special sacrifice or loss has occurred, and thus loss compensation cannot be claimed.

Ahn Dae-hee, Director of the Water Circulation Safety Bureau of Seoul City, stated, "With this ruling, we expect to win in 76 similar lawsuits currently underway on the same issue. Moving forward, we will thoroughly manage to prevent double compensation for loss claims that contradict the notion of fairness, and actively compensate rightful claimants of river-incorporated land to guarantee private property rights and protect their rights."