Kim & Chang’s Banking, Securities & Finance Litigation Group, representing the investment broker of an investment trust (fund), successfully obtained Supreme Court rulings dismissing investors’ primary claims for restitution of unjust enrichment—in the amount of their investments—which had been asserted on the grounds of rescission for fraud or mistake, together with alternative claims for damages based on mis-selling, in a series of related cases (Supreme Court Decisions 2024Da221141 (April 2, 2026); 2024Da309461, 2024Da309454, and 2025Da214703 (April 9, 2026), among others).

The Supreme Court held that where an investment broker of an investment trust, acting in good faith, transmits the investment funds intact to the trustee, the presumption of surviving enrichment is rebutted—absent special circumstances—regardless of how those funds are subsequently deployed at the asset management stage. This ruling carries substantial significance as the first Supreme Court authority confirming that the legal principle articulated in Supreme Court Decision 2018Da244488 (October 14, 2022) on rebuttal of the presumption of surviving enrichment with respect to a bona fide beneficiary is not confined to particular fact patterns but applies more generally to investment brokers of investment trusts (funds).

Further, in contrast to prior Supreme Court authority under the former Indirect Investment Asset Management Business Act, which had characterized the relationship between a “distributor” and its investors as one of “sale and purchase,” the Supreme Court characterized the legal relationship between the investment broker and the investors as “an agreement concerning investment in a collective investment vehicle.” The Supreme Court further held that, once the investment funds are paid to the trustee and the investors acquire beneficiary certificates, “a legal relationship is formed among the investors and the parties associated with the collective investment vehicle.” Taken together, these holdings represent a meaningful advancement of the jurisprudence governing the legal relationships within investment trusts (funds) as a whole.

To secure this outcome, we presented a systematic doctrinal analysis of the Financial Investment Services and Capital Markets Act and its subordinate regulations, while also explaining in concrete terms the role that an investment broker of an investment trust actually performs in the financial markets and the actual flow through which investment funds are transmitted. On that basis, we persuaded the Supreme Court that the management of investment funds lies within the authority and responsibility of the collective investment business entity, and that an investment broker bears only the duty to transmit investment funds to the trustee and has no authority over how those funds are subsequently managed—making it appropriate to allocate liability in a manner commensurate with the investment broker’s actual authority and function.

This Supreme Court jurisprudence stands as leading authority on (i) the parties among whom the legal relationships of an investment trust are formed and (ii) the role and responsibility of investment brokers, and is expected to serve as important precedent for similar fund-related disputes going forward.