Currently, the land equity of the Appujeong Hyundai Phase 3 and 4 apartments in Apgujeong-dong, Seoul, is shared among the members of the association, the Seoul city government, Hyundai E&C, and Hyundai Development Company. The land registration for these apartments (collective buildings) indicates that the apartment owners corresponding to the land plot are listed as co-owners in the 'gapgu,' which informs about the ownership rights. However, unexpectedly, third parties, including Hyundai E&C, are listed here.
The issue that the construction company did not properly organize the equity during the development, execution, construction, and sale of these apartments in 1975 has emerged 50 years later during the reconstruction process.
According to the opinions of the members of the association and industry officials, Hyundai E&C and other development firms should transfer the land equity to the joint buyers after they sold the Appujeong Hyundai Phase 3 and 4 apartments, but they did not do so and instead donated it to the Seoul city government through contributed acceptance. Moreover, some portions are still registered in the company's name.
It has been identified that there were even mistakes in the contributed acceptance process, where more equity was transferred to the Seoul city government than what was held on the registration. Among experts, there are discussions suggesting that Hyundai E&C and HDC Hyundai Development Company should return this land to the joint buyers or actual owners.
On the 16th, according to the construction industry, the owners of the Appujeong Hyundai Phase 3 and 4 apartments analyzed the land where Hyundai E&C, Korea Urban Development (formerly HDC Hyundai Development Company), and the Seoul city government have ownership, through the law firm Daeryukajoo, revealing that there was an incorrect registration of the equity relations. They analyzed nine parcels, including 462, 462-1, 462-2, 466, 478, 464, 464-1, 465, and 467-2, and found that all these parcels were classified in the land register as 'the sum of shared equity exceeds 1'.
With more owners than the land's equity ratio, it means that property evaluation on the land is impossible, and final assets evaluations are difficult, leading to complications in the maintenance project. Excluding the market value of the land donated by Hyundai E&C and Korea Urban Development to the Seoul city government (approximately 350 billion won), the combined land value held by the two construction companies amounts to 2.24 trillion won.
Hyundai E&C and HDC Hyundai Development Company are currently preparing a countermeasure after realizing these facts through a report by ChosunBiz.
Opinions among experts are divided. Seo Jin-hyung, a professor at Kwangwoon University’s Department of Real Estate Law, said, "They should pursue a method to receive the donations without charge through negotiations with the construction companies." This implies that they should return the equity due to actions that violate the principle of good faith. Yu Seon-jong, a professor at Konkuk University’s Department of Real Estate, mentioned, "In principle, they should return it, but as the governance structure of the construction company has changed and if the management decides to return the company's assets, shareholders may object and issues of breach of trust may arise, so the company may assert ownership rights. "
Park Hapsu, an adjunct professor at Konkuk University’s Department of Real Estate, stated, "If the construction companies assert ownership, it will inevitably lead to litigation, as the ownership of such significant assets is at stake, making it a difficult problem for a third party to predict the conclusion."
The land registered as municipal property of Seoul is expected to become a larger controversy. According to Daeryukajoo analysis, the equity held in the past by Korea Urban Development in seven plots, including 462, 462-1, 462-2, 466, 478, 464, and 464-1, was 8.34%. However, on May 13, 1979, they donated 13.95% of the equity to the Seoul city government (contributed acceptance). The donation was made in two phases, 4.75% and 9.2%. All were recorded as of May 11, 1979, but the second donation of 9.2% was retroactively recorded on the registration dated May 11, 1979, after the 1986 registration. This indicates that the registration from 1979 was modified in 1986. Through this process, the equity that Korea Urban Development held (8.34%) transferred to the Seoul city government was 5.61% more than what they owned, totaling 13.95%. This means that Korea Urban Development donated land they did not even hold title to the Seoul city government.
Approximately 4,655.2 square meters registered as Seoul city property will not become subject to statutory acquisition under the National Property Management Act. Even if the Appujeong Hyundai Phase 3 and 4 apartments have practically occupied it for a long time, it means they will find it difficult to assert ownership. Professor Seo Jin-hyung commented, "The only method left would be to negotiate to purchase the municipal property."
In this regard, a representative from Hyundai E&C said, "While the cause is not clear, it seems that the equity was not properly organized at that time," and added, "We are in the process of understanding the factual circumstances."