[비즈한국] It has been confirmed that former Namyang Dairy Products Chairman Hong Won-sik, who initially won a lawsuit for the return of artwork against Hong Song-won, former CEO of Seomi Gallery, has lost the case in the appellate court. More than a decade ago, former Chairman Hong exchanged an Alexander Calder piece with the former CEO, but later filed a lawsuit to cancel the exchange contract, claiming that the work he received was a forgery. However, the appellate court ruled that the statute of limitations for canceling the contract had already expired.
On the 25th of last month, the 5-2 Civil Division of the Seoul High Court (Presiding Judge Kim Dae-hyun) overturned the first-trial ruling against former CEO Hong Song-won in the art return lawsuit filed by former Namyang Dairy Products Chairman Hong Won-sik, and dismissed all of the former chairman's claims. Previously, former Chairman Hong had filed a lawsuit to rescind the transaction in which he traded an authentic piece he owned for the fake artwork held by the former CEO, winning the first trial in June last year.
The dispute began when both parties exchanged works they claimed were by Alexander Calder. Calder is a 20th-century American sculptor known as the "father of the mobile." Former Chairman Hong entered into a contract to trade his piece, "THE RED," for the former CEO's piece, "MISSING WING," and the two parties exchanged the works.
However, the work received by former Chairman Hong was determined to be a forgery. In February 2024, when former Chairman Hong inquired about the authenticity of the piece with the Calder Foundation, the foundation responded that it was a forgery. The foundation explained that "MISSING WING" was not listed in the Calder Foundation’s computerized database and that the production method and materials appeared different from Calder’s work upon visual inspection. The Calder Foundation is a non-profit organization established by the Calder family in 1987.
In response, former Chairman Hong filed a lawsuit in May 2024 to rescind the art exchange. He argued that since the former CEO had worked as a gallery operator and was involved in art brokerage for a considerable time, she could have easily identified that "MISSING WING" was not a Calder work, yet she misled him into the exchange contract as if it were authentic. Former Chairman Hong claimed that the exchange contract was signed under fraud or duress, and thus he was entitled to rescind the earlier declaration of intent to exchange the artwork.
However, the appellate court ruled that the contract could not be canceled because the statute of limitations had passed. The Seoul High Court bench determined that the exchange contract was signed in April 2012, and since the lawsuit was filed in May 2024, it exceeded the 10-year limit for exercising the right of rescission. Under the Civil Act, a person who makes a declaration of intent due to mistake, fraud, or duress may rescind the legal act within 10 years.
The court based its judgment that the contract was signed in April 2012 on the following: △ "MISSING WING" was exhibited at Seomi Gallery in April 2012, △ the "THE RED" piece held by the former chairman was installed in the same spot the following day, and △ the details of the artwork movement were recorded in a Seomi Gallery employee’s work log. Furthermore, the court added that the explanation from the Calder Foundation alone was insufficient to prove that "MISSING WING" was a forgery.
Meanwhile, this appeal proceeded after former CEO Hong Song-won filed an appeal for restoration (Chu-wan appeal) following BizHankook’s reporting on the first-trial ruling. Previously, because the lawsuit documents were not properly delivered to the former CEO, the first trial proceeded through a court method of public notice. The appellate court ruled that the former CEO’s appeal, filed in July last year after she saw news articles related to the lawsuit in late June, was a valid appeal for restoration. An appeal for restoration is an appeal exceptionally permitted when a party fails to meet the appeal deadline due to reasons beyond their control.