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IPG Legal is one of the leading Korean law firms assisting families residing globally in Korean Adult Guardianship, Korean Inheritance, Korean Estate Planning, and Korean Inheritance Tax Matters.
Increasingly, the Korean Guardianship System is being utilized to resolve complex and contentious corporate management disputes.
Adult Guardianship as a Tool to Resolve Korean Company Management Disputes
Adult guardianship in Korea was typically associated with protecting individuals who cannot make decisions for themselves due to mental or physical incapacity. Today, lawyers in Korea are strategically utilizing adult guardianship as a tool to resolve corporate disputes in Korea, particularly when there are management battles within family-run companies in Korea.
The typical case is an elderly founder showing signs of dementia, and a dispute occurs between the children or relatives over company control. One party applies for adult guardianship to control the founder’s shares and voting rights.
Company management disputes between the children of founders are, increasingly, leading to adult guardianship disputes. Korean statistics indicate that the number of cases related to adult guardianship is on the rise. According to the Korean Judicial Yearbook, the number of adult guardianship cases filed has been on an upward trend: 6,984 in 2019, 8,180 in 2020, 8,605 in 2021, 8,324 in 2022, and 8,823 in 2023. The complete data is not available for 2024. Data is not segregated based on links to management disputes, but the reality is evident from cases we and other law firms in Korea are currently working on.
Adult Guardianship in Korea
The following are the four types of adult guardianship in Korea. For more information, please see: Korean Adult Guardianship.
- Korean Full Guardianship (성년후견, seongnyeon hugyeon): This type is the most encompassing type of adult guardianship in Korea and is intended for wards who continuously and indefinitely lack the capacity to manage any and all of the major personal affairs of life. Thus, the Korean Family Court appoints a guardian to make all legal, financial, and personal decisions for the ward.
- Korean Limited Guardianship (한정후견, hanjeong hugyeon): Limited Guardianship in Korea is intended for wards who can not perform all the functions necessary for life, but who retain partial capacity to manage affairs. In this case, the Korean Family Court appoints a guardian for a limited scope of activities based on the specific needs of the ward.
- Korean Specified Guardianship (특정후견, teukjeong hugyeon): Specified Guardianship is typically temporary or for a specific matter. Specified Guardianship, in most cases, is for a limited function such as signing a contract or managing the sales of a property.
- Korean Voluntary Guardianship (임의후견, im-ui hugyeon): Voluntary Guardianship, as the name suggests, is for individuals with full capacity to pre-arrange a guardianship agreement with a guardian. Voluntary Guardianship becomes legally effective only when the Family Court of Korea appoints a supervisor for the guardian.
We will update the reader when more information becomes available. For more information, please contact IPG Legal or explore our Korean Inheritance Law Archive.
by Sean Hayes
Sean Hayes is a senior foreign attorney at IPG Legal, one of Korea’s leading international law firms. With over two decades of experience in Korea, he is recognized as the first non-Korean attorney to work for the Korean court system and one of the first to be appointed a regular member of a Korean law faculty. He is known for his aggressive advocacy and proactive street-smart advice. Sean is recognized as a top attorney for his work in Asia, and his firm is ranked as a top dispute resolution law firm, with a tier ranking in the leading legal rating services.
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