The Supreme Court will implement a system of registering cautionary notice regarding transactions of real estate belonging to trust property. This new measure aims to tackle the recent social issue of Jeonse fraud and will take effect on December 21, 2024. When entering into a lease agreement for real estate that has been registered as trust property, it is necessary to verify not only the certified copy of the registry but also the original trust document. The lease agreement must be concluded with the authorized trustee, who has legitimate leasing authority.

Unfortunately, there have been many cases of issues arising from this process, such as tenants being unable to recover their deposits. This often occurs when lease agreements are signed with trustees or individuals who do not have proper leasing authority, primarily due to the failure to verify the original trust document.

In order to prevent such damage, the Supreme court and the Ministry of Justice have amended the ‘Registration of Real Estate Act’ and provide a legal basis for allowing registration officers to record ex officio cautionary notices regarding transactions of real estate at the time of registering trust property. The amendment is scheduled to take effect on December 21, 2024. With the registration of cautionary notices for real estate transactions involving trust property, parties will be notified about the need to verify the original trust documents. This is expected to significantly reduce the damages suffered by lessees of trust property who enter into lease agreements without verifying the original trust documents.

It will also swiftly complete the automatic registration of cautionary notices for approximately 1.47 million trust property registrations that were finalized before December 21, 2024. Starting from January 31, 2025, the Supreme Court will provide a service that allows public to access original copies of trust documents through the Internet Registry Office, making it more convenient to obtain these documents.

In early 2023, the Supreme Court improved the procedures for lease registration following the “Villa King” case. These changes aim to quickly protect the rights of victims of jeonse fraud. Additionally, from June 2024, registration fees will be waived to help alleviate the financial burden on these victims. The Supreme Court is committed to protecting the rights of socially vulnerable individuals and is looking to introduce a system for registering cautionary notices related to transactions of real estate that is part of trust property.