[Success Case] Breaking the "Fake Lien" Cycle: Successfully Normalizing Auctions Blocked by Repetitive False Claims

In the world of real estate auctions, "Fake Liens" (허위 유치권) are a notorious tactic used by bad-faith actors to delay proceedings and drive down sale prices. Today, we share a significant success case where Law Firm Hoam systematically blocked a construction company from interfering with multiple auctions through a series of consecutive "Non-Existence of Lien" judgments.

Multiple clients (the lenders) were in the process of exercising their collateral rights through real estate auctions. However, they all faced the same hurdle: a specific construction company was repeatedly filing lien claims based on alleged unpaid construction costs.

This was not a one-time incident but a repetitive, patterned behavior. By hanging banners and claiming possession, the construction company caused procedural delays and financial risks for the lenders. The clients sought out Law Firm Hoam to break this structural cycle of obstruction.

Law Firm Hoam didn't just respond to each lien claim individually. Instead, we analyzed the repetitive nature of the dispute and established a unified "Total Response Strategy":

• Verifying the Reality of the Debt: We exhaustively reviewed the alleged construction history and contracts. We argued that the "unpaid costs" the company claimed were either non-existent or legally invalid, challenging the very foundation of the lien.
• Proving Lack of Physical Possession: A lien requires continuous and exclusive physical possession. We cross-referenced appraisal reports, field investigation logs from the court execution officer, and the actual site conditions to prove that the company’s "banners" did not constitute legal possession.
• Preemptive "Non-Existence of Lien" Lawsuit: We strategically chose to file the lawsuits ourselves. In a "Negative Declaratory Action," the burden of proof regarding the existence of the lien falls on the defendant (the construction company). This structural advantage allowed us to systematically dismantle their weak claims.

The court consistently ruled in favor of Law Firm Hoam’s clients across multiple cases:

• String of Victories: We secured consecutive final judgments of "Non-Existence of Lien" against the same defendant (two cases in Oct 2025, one in Jan 2026).
• Auction Normalization: We immediately applied these judgments to the ongoing auction proceedings, removing the liens from the sale conditions.
• Full Cost Recovery: The court ordered the defendant to bear 100% of the litigation costs.

The properties were successfully re-integrated into the market as "clean" assets, allowing the lenders to recover their funds at fair market value.

Winning a lawsuit against a fake lien is only half the battle. The true measure of success is whether the auction actually returns to normal.

At Law Firm Hoam, we don't just "win on paper." We design the entire lifecycle of the dispute—from the initial lien claim to the final distribution of auction proceeds. By treating patterned disputes as a structural problem, we provide the comprehensive solutions necessary to protect your collateral value. If a lien is blocking your path to recovery, partner with the experts who know how to clear the way.

Law Firm Hoam | Specialized in Lien Disputes, Auction Obstruction & Collateral Execution