United States District Court, D. Kansas
MEMORANDUM AND ORDER
THOMAS MARTEN, JUDGE
matter came before the court on June 13, 2017, for a bench
trial. At the conclusion of the evidence, the court granted
the parties additional time to brief their respective
positions. Those briefs have now been filed and the court is
prepared to rule.
plaintiffs Steve Young and Eun Young are husband and wife.
The defendants Ki Ok Son (referred to as “Jack
Son”) and Hye Jin Son (“Hye”) are also
husband and wife. Hye is the sister of Steve, meaning Steve
and Jack are brothers-in-law.
be discussed more fully herein, the evidence at trial focused
on two events. The first involved Steve giving a $215, 000
check to Jack. Both sides agree Steve deposited a $215, 000
check in an account controlled by Jack, and defendants later
returned $50, 000 to Steve, but defendants refused to return
the remaining $165, 000. The second event includes
allegations of improper bank transfers in South Korea and
promissory notes allegedly signed by plaintiffs. Defendants
contend Steve made several unauthorized withdrawals from
Hye's accounts in Korea and, as a result, Steve and Eun
later executed a $200, 000 promissory note in Hye's
favor. Defendants argue they are entitled to keep the $165,
000 received from Steve as an offset to Steve's unpaid
debt on the promissory note.
Findings of fact.
of $215, 000 check. Steve Young graduated from the Naval
Academy in the Republic of Korea (South Korea) and served in
that country's navy for six years. He then came to the
U.S., where he ran several businesses, including a grocery
market and a cleaning company. In 2010, Steve opened a sushi
restaurant called Wasabi near downtown Wichita. He opened a
second Wasabi in Wichita later in 2010.
early 2013, Steve had accumulated $215, 000 to purchase
equipment and to pay operating expenses for a third Wasabi,
which was to be located on Wichita's west side. Steve and
Eun were having marital difficulties at the time. As a
result, Steve was concerned that his wife might take the
funds for the restaurant. He spoke to his brother-in-law,
Jack, and the two agreed Steve should deposit the funds in
the bank account of Across Construction Corporation, to which
Jack had access. Steve explained the money was to fund the
restaurant, and Jack said he would return it whenever Steve
needed it. Steve obtained a cashier's check for $215, 000
and deposited it in the Across Construction account at Bank
of America in Wichita on March 4, 2013. Exh. 5.
subsequently requested that Jack return the $215, 000. Jack
sent payments totaling $50, 000. He refused to return the
additional $165, 000 that Steve had given him.
notes. Back in early 2010, according to plaintiffs'
evidence, Steve and Jack discussed the possibility of Jack
and Hye investing in the initial Wasabi restaurant. Jack said
before he would invest, he would need a legal document. As a
result, on May 6, 2010, Steve emailed Jack several copies of
a proposed promissory note. See Exh. 2. The
proposals were hand and type-written in Korean. Translated,
one note states that Steve borrowed $200, 000 from Hye to
open the Wasabi Restaurant on East Douglas [the first Wasabi]
and that until Steve pays off this debt, he gives Hye rights
as first and primary creditor, and if the restaurant is sold
Hye will receive her funds first. Exh. 2, p.3. A handwritten
version by Steve, which was faxed by him to Jack and Hye,
appears at Exh. 2, page SON013. The fax indicates it was sent
on May 8, 2010.
6, a promissory note emailed by Steve to Jack on May 6, 2010,
bears apparent signatures of Steve and Eun Young and of Hye
Jin Son. A handwritten description of Steve and Eun as
“Debtor[s], ” and their apparent signatures dated
March 4, 2013, appear at the bottom of Exhibit 6. A
description of Hye as “Creditor” and her
signature dated March 19, 2013, also appear at the bottom.
Similar signatures appear on the bottom of the May 8, 2010,
fax sent by Young. Defendants contend plaintiffs signed these
notes on March 4, 2013, when Jack came from California to
help Steve. Among other things, Jack bailed Steve out of jail
after Steve was accused of domestic violence. Steve and Eun
each testified they did not sign this or any other promissory
note. They also testified that neither Jack nor Hye loaned
them $200, 000 or any lesser amount to construct a Wasabi
version of events was that Steve contacted Hye in April 2010,
and told her she might be contacted by a bank inspector.
According to her, Steve said he had had transferred funds out
of her account without her permission and with the assistance
of Hee Do Oh, a Korean bank employee. Steve and Hye both had
accounts at Hana Bank in South Korea. Both of their accounts
were managed by Hee Do Oh, who had known Steve since their
days together in the navy. Hee also worked with Steve's
wife Eun at Hana Bank. Hee knew Hye and Jack, having been
introduced to them by Steve around the year 2000.
to Hye, Steve told her Hee would get fired and the Wasabi
restaurant would have trouble if she didn't say she had
authorized the transfers. Hye testified that when the bank
subsequently contacted her, she told them she had authorized
the transfers. She testified Steve drafted the $200, 000
promissory note as a result of having transferred these funds
out of her account. She testified that when she found out
about the $215, 000 check Steve had deposited into the Across
Construction account, she thought it was repayment for the
funds taken. She testified she returned $50, 000 of the $215,
000 to Steve upon his request.
conceded that receipts showing money transfers to Eun Young
or Wasabi restaurant during the relevant time totaled at most
$117, 000, but she testified Steve made a promissory note for
$200, 000 because Jack had spent additional funds helping
Steve, because defendants had suffered damages in a car
accident, and because Steve felt guilty and wanted to make up
for what he had done. Jack testified he came to Wichita at
Steve's request to bail him out of jail and help him ...