SOUTH KOREA Law and Practice Contributed by: Woong-kyu Cho, Ji-eun Kim and Hyun-kyung Kim, Barun Law LLC
to a contract (Article 29-2 of the Act on Guarantee of Rights of and Support for Persons with Developmen - tal Disabilities). 8.2 Appointment of a Guardian Under Korean law, the guardianship system protects and supports individuals who lack sufficient capacity to make or implement reasonable decisions. The system is divided into statutory guardianship and voluntary guardianship, depending on how the guardian is appointed. In statutory guardianship, the Family Court appoints the guardian. In voluntary guardianship, the individual designates the guardian in advance, but the Family Court must appoint a volun - tary guardianship supervisor before the guardian may lawfully commence their duties. Accordingly, an appli - cation to the Family Court is required before either form of guardianship becomes effective. A statutory guardian is subject to ongoing supervision by the Family Court, including regular reporting obli - gations and the requirement to obtain court approval for significant matters, such as the disposal of the ward’s property. A voluntary guardian is supervised primarily by the voluntary guardianship supervisor appointed by the Family Court. That supervisor is also subject to the Family Court’s oversight, so both statutory and volun - tary guardianship ultimately operate under the super - vision of the Family Court rather than solely at the discretion of the parties. 8.3 Planning for Incapacity Unlike the United States, where a durable power of attorney allows a person to authorise another to make medical or financial decisions in the event of incapac - ity without court involvement, Korean law does not expressly recognise such a system. Instead, the Korean Civil Act provides for voluntary guardianship, under which a person may appoint a guardian by contract in advance to make personal and financial decisions if the person’s mental capac - ity later becomes impaired. The guardian’s authority takes effect when the statutory requirements for vol - untary guardianship are satisfied.
Although voluntary guardianship is not yet widely used, interest is gradually increasing, particularly among single-person households, individuals without family caregivers, and those who have already com - pleted their succession planning. As life expectancy continues to increase, its use is expected to become more widespread. 8.4 Elder Law From a legal perspective, the guardianship system enables individuals to prepare for situations in which diminished mental capacity prevents them from con - ducting essential financial transactions or giving valid consent to medical treatment. Under Korean law, legal acts performed by a person lacking mental capacity are invalid. Accordingly, finan - cial institutions generally require confirmation of the account holder’s intent before permitting significant withdrawals beyond ordinary daily expenses. Where communication is substantially impaired by dementia or a similar condition, transactions may be restricted, preventing the individual from managing their own assets. Once a guardian is appointed, however, the guardian acts as the individual’s lawful representa - tive and may conduct financial transactions on the person’s behalf. Apart from the guardianship system, financial sup - port is largely limited to medical and long-term care expenses. Broader mechanisms enabling individuals to prepare financially for old age remain underdevel - oped. Although Korea has a national pension sys - tem, benefits are generally insufficient to cover living expenses. Consequently, where personal retirement planning is inadequate, the financial burden often falls on family members, contributing to a growing number of elderly persons who lack adequate family support. Accordingly, further discussion is needed on expand - ing financial support and developing legal and social systems that better enable individuals to prepare for old age.
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