The contract for the sale of apartments in Korea is based on the pre-sale and ‘post construction’ method. In other words, the buyer concludes a contract to sell apartments by relying only on the sale advertisement catalogs and model houses provided by the selling company. As a result, there was a need to protect the buyer from the false advertising of the selling company. The Supreme Court considers whether the apartment sale advertisements is incorporated into the contents of an apartment sale contract as a criterion for the protection of buyers.
The Supreme Court ruled that the apartment sale advertisement is an invitation to bargain to the buyer of the sale business, and the apartment sale advertisement can not be regarded as the contents of the apartment sale contract immediately. Nevertheless, the Supreme Court theorizes that there is an explicit or implied consensus that the selling
company and the buyer should acknowledge the sale advertising as part of the apartment sale contract. In addition, if the apartment sale advertisement is not incorporated into the contents of the apartment sale contract, if the apartment sale advertisement is false or exaggerated advertising, or does not fulfill the obligation notified according to the principle of good faith, the buyer can claim damages from the selling company. The Supreme Court,
however, is concerned with what constitutes an obligation under the principle of good faith on apartment sale advertisements, in which case the apartment sale advertisement corresponds to false and exaggerated advertising, and how the apartment sale advertisement relates to the illegal display and advertising prescribed in the Advertising
Act. But it does not provide a clear criterion. Therefore, this study tries to present practical judgment criteria to relieve the buyer s damage caused by false or exaggerated advertisement of the selling company. In order to
do this, This paper will first review the requirements and criteria for the apartment sale advertisements to be incorporated into apartment sales contracts. Based on this, it suggests that the criterion of the claimant s right to claim damages in the contract status and the criterion in case the apartment sale advertisement should not be incorporated into the contents of the apartment sale contract. Finally, this study examines the legal theory
and its applied standard that can protect the buyer from the false or exaggerated advertising of the selling company.