The Supreme Court has ruled that a unilateral reduction of golf course usage benefits by the operator of a deposit-based golf club, implemented without the consent of existing members, is invalid.

Deposit-based golf clubs operate on a system where members pay a deposit to the operator to receive priority access to facilities, with the principal amount returned upon withdrawal.

The First Division of the Supreme Court (Justice Shin Sook-hee presiding) recently overturned a lower court ruling that had favored the defendant in a lawsuit filed by a corporate member, Company B, against Resort A, a deposit-based golf club operator in Gangwon Province. The case has been remanded to the Seoul High Court.

Under the VVIP corporate regular membership purchased by Company B, four unnamed members were previously entitled to the same regular member rates (60,000 KRW on weekdays and 70,000 KRW on weekends) even when the regular member was not present.

The conflict arose in 2022 when the resort, following resolutions by its board of directors and golf course operation committee, changed the policy to charge higher rates to unnamed members when the regular member is not present.

The resort raised the regular member rate to 80,000 KRW on weekdays and 90,000 KRW on weekends and public holidays, while setting the rate for unnamed members at 120,000 KRW on weekdays and 140,000 KRW on weekends and public holidays.

Company B filed a lawsuit, arguing that the unilateral change in usage conditions was invalid and demanding that unnamed members continue to be granted the same rates as regular members, even when not accompanied by a regular member.

While Company B won in the first trial, the second trial overturned the decision and ruled in favor of Resort A.

The appellate court reasoned that the resort had a need to change usage conditions within a reasonable scope, and that members could have anticipated that usage conditions might change at the time they joined.

Furthermore, the second trial court determined that because the operation committee, composed of more than 10 members representing the club's members, had agreed to the changes, individual consent from all members was not strictly required.

However, the Supreme Court reversed the appellate court's decision, stating that the changes in question could not be applied without the individual approval of existing members.

The Supreme Court explained, "The change in question constitutes a modification of the contract terms that alters the fundamental status of the members, as it changes the existing usage conditions that were incorporated into the contract between the plaintiff and the defendant."

The court held that even if there is a provision in the club rules stating that usage fees can be changed through a board resolution, any change that causes a significant alteration to a member's fundamental status requires the individual approval of existing members.

The Supreme Court stated, "The right to use golf course facilities included in a deposit-based golf membership allows members to use the facilities under more favorable conditions than general users. Therefore, matters concerning golf course usage, such as the treatment of unnamed members as regular members, are considered important factors for corporate members who pay large deposits to acquire membership."

The court concluded that because the changes had a significant impact on the plaintiff's rights and constituted a major modification of the contract, they were invalid as they were implemented without the individual approval or consent of the plaintiff.

(Photo: Yonhap News)