IADC member Kurt Gerstner, a Senior Foreign Attorney at Lee International IP & Law Group in Seoul, South Korea, obtained a favorable jury verdict for his client in the United States District Court for the Southern District of New York.
His client, a Korean product manufacturer, sold goods on credit to a company in New York, based on oral statements by the owner of the New York company that he would make sure the Korean company was paid. The New York company was struggling financially and when the outstanding balance owed grew to more than $1 million, the Korean company requested that the owner of the New York company sign a formal document acknowledging the debt and promising to pay.
Rather than having counsel prepare the document to be signed, a manager in the Korean company prepared the document himself, based on a Korean legal form book. The document, entitled "Promissory to Settle Balance," was a two-sentence document, written in broken English, that made no mention of consideration and left the time and manner of payment to be decided in the future by the owner of the New York company. The owner did sign the document but the payment was never made by the New York company or the owner.
Later, when the New York company ceased operating and the Korean company demanded payment from the owner, he denied having any obligation to pay and denied that the document he signed guaranteed payment or that there was any consideration supporting it. The Korean company brought suit against the owner, arguing that the document signed was a valid guaranty supported by consideration under New York law, obligating the New York company owner to pay the Korean company approximately $1.7 million for the trade debt of his company. The case was tried to a jury. After approximately 40 minutes of deliberations, the jury unanimously found in favor of the Korean company, awarding the full amount of the outstanding debt.