[2] In a case where a farmland lease violates the former Farmland Act and thus the validity of the contract is not recognized, whether the lessee may refuse to return the farmland lease for the reason that the lessee has no title to the lessee during the lease term, on the ground that the lessee has occupied and used the farmland for illegal consideration (negative in principle)

Meanwhile, the purpose of the former Farmland Act is to contribute to strengthening the agricultural competitiveness, the balanced development of the national economy, and the preservation of national land by efficiently using and managing farmland by prescribing matters necessary for the ownership, use, preservation, etc. of farmland (Article 1). Furthermore, since farmland is the foundation necessary for supplying food to citizens and preserving the national environment, and is a limited valuable resource that affects the harmonious development of agriculture and the national economy, the exercise of the rights to farmland shall be subject to necessary restrictions and obligations and shall not be subject to speculation (Article 3(1) and (2)).

In full view of such provisions of the former Farmland Act and the above constitutional provisions, the purport of the prohibition of the former Farmland Act, in principle, is to ensure that farmland can be preserved as farmland by a farmer for the purpose of farming, and that the external capital would facilitate the acquisition of farmland by the farmer by stabilizing the land price by removing incentives to acquire farmland for the purpose of speculation, etc. In addition, in order to achieve such legislative intent, it is reasonable to prevent a farmer from realizing economic benefits under the terms of the contract by denying the validity of the farmland lease contract itself, separate from criminal punishment, so that the effect of the farmland lease contract can not be realized. Therefore, Article 23 of the former Farmland Act prohibiting the lease of farmland is a mandatory provision. Therefore, even though it does not constitute an exception under Article 23 of the former Farmland Act, the lease agreement to lease farmland in violation of this provision is null and void.

[2] Article 746 of the Civil Act provides that “If a property is provided or labor is provided due to an illegal cause, the return of such benefit shall not be claimed.” In the event of illegal consideration, a claim for return of unjust enrichment may not be made.” In order to establish illegal consideration, the act that caused the performance is not only in violation of good customs and other social order, in light of the content, nature, purpose, or connection, etc. of the act that is the cause of performance, but also constitutes a case where: (a) the act is deemed to be in violation of good customs and other social order; (b) the anti-sociality, anti-competitive ethics, and morality; (c)

However, the lease of farmland subject to the application of the former Farmland Act (amended by Act No. 13022, Jan. 20, 2015; hereinafter the same) is a farmland, but there is no intrinsic difference from the lease of general real estate in that it is an agreement to allow the use of and benefit from the subject matter and to be paid a rent. This is significantly different from the fact that a prop has accepted a tenant as a tenant in the form of a small fee or even formed a relationship with his/her status, beyond the ordinary level of land rent. In other words, today’s ordinary lease of farmland is subject to special regulations for the sake of the principle of freedom of light and rational use of farmland. However, barring any special circumstance, it cannot be readily concluded that the content or nature of a contract is obvious anti-ethicity, morality, and sociality.

In addition, considering the current farmland size and holding status of Korea, the ratio of farmers to the farmland owned by non-farmers, diversity of reasons for ownership of farmland, farmland subject to the application of the former Farmland Act includes not only typical farmings such as electric field and field, but also the site for orchard and its affiliated facilities. Considering a large number of social circumstances where land is used differently from the land category, and other all other circumstances, seeking active realization of the terms of the contract, such as claiming the rent based on the farmland lease contract, can not be permitted. However, in addition, it cannot be said that the norm of the former Farmland Act has been achieved only when the lessor claims return of unjust enrichment or compensation for damages with respect to the occupancy profit equivalent to the occupancy profit of the land acquired by the lessee from the use and profit of the relevant farmland during the lease contract period.

Therefore, even if a farmland lease is in violation of the former Farmland Act and thus cannot be recognized as the validity of the contract, it is intended to provide the purpose of the lease to the extent that it is difficult to preserve it as farmland, and in view of social norms, such as a case where the purpose of the lease is lost, or the lessor leases the farmland acquired solely for speculation as part of recovery of invested capital without any intention to self-defiscate, etc., the lessee cannot reject the return on the ground of the legal principle of illegal consideration, unless there are special circumstances where it is no relations with the enhancement of agricultural productivity provided for legitimate purpose of the farmland lease under Article 121(2) of the Constitution, and there is no relations with the rational use of the farmland, and it is contrary to the ideology of the former Farmland Act, and it is obvious that it is against society.

2. The remaining appeals by the Defendant (Counterclaim Plaintiff) are dismissed.

1. The grounds for the principal lawsuit and counterclaim and the judgment of the court below

According to the reasoning of the lower judgment and the record, the Plaintiff (Counterclaim Defendant) leased each of the instant real estate to the Defendant (Counterclaim Plaintiff) (hereinafter “Defendant”) for one year from April 13, 2011 to April 12, 2012. The Defendant paid the Plaintiff the annual rent of KRW 4.5 million to the Plaintiff. After the lease period expires, the Defendant occupied each of the instant real estate by March 22, 2013, and each of the instant real estate consists of an orchard, miscellaneous land, and storage facilities on the ground.

After the termination of the above lease term, the Plaintiff sought compensation for damages equivalent to the rent, on the ground that the Defendant possession of each of the instant real estate constitutes an illegal possession with no legitimate title. Accordingly, the Defendant, as a counterclaim, sought a return of unjust enrichment equivalent to KRW 4.5 million already paid in rent on the ground that the lease contract of this case is null and void on the ground that the lease contract of this case constitutes farmland under the Farmland Act. If the lease contract of this case is null and void, the Plaintiff asserted that the Defendant is liable to compensate for damages equivalent to the rent arising therefrom, since the Defendant occupied and used each of the instant real estate without title during the period of the agreed lease term, as the lease contract of this case becomes null and void, the Defendant was obligated to automatically

(1) The court below rejected the Plaintiff’s claim for damages equivalent to the rent after the termination of the instant lease term, and (2) as to the Defendant’s counterclaim, the lower court rejected this claim on the ground that: (a) it is reasonable to deem that the Plaintiff’s lease of each of the instant real estate in violation of the Farmland Act, which is a mandatory provision, constitutes illegal consideration in good morals and other social order; and (b) it is reasonable to deem that the Plaintiff’s lease of each of the instant real estate in violation of the Farmland Act constitutes illegal consideration in violation of good customs and other social order; and (c) it rejected the Plaintiff’s counterclaim and accepted the Defendant’s counterclaim on the ground that the Plaintiff did not cooperate necessary to register the land of each of the instant real estate in the farmland ledger.

2. Of both grounds of appeal, we first examine the Plaintiff’s grounds of appeal No. 1 and No. 4.

A. The Constitution provides that “The State shall endeavor to achieve the principle of light freedom with respect to farmland” (Article 121(1)); and that “The lease and entrusted management of farmland arising from the enhancement of agricultural productivity and the rational utilization of farmland or due to inevitable circumstances shall be recognized under the conditions as prescribed by Act” (Article 121(2)). Accordingly, the former Farmland Act (amended by Act No. 13022, Jan. 20, 2015; hereinafter the same shall apply) provides that “The lease of farmland owned by a person who is not temporarily engaged in agricultural management due to inevitable reasons, such as illness, conscription, school attendance, taking public office due to election, etc., shall not be permitted unless it falls under any of the following reasons (Article 23).” Article 60 Subparag. 2) provides that a person who owns farmland in violation of this provision shall be punished by a fine not exceeding ten million won (Article 60 Subparag. 2). 2).

B. Meanwhile, the former Farmland Act aims to contribute to strengthening the agricultural competitiveness, the balanced development of the national economy, and the preservation of the national land by efficiently using and managing farmland by prescribing matters necessary for the ownership, use, preservation, etc. of farmland (Article 1). Furthermore, since farmland is the foundation necessary for supplying food to citizens and preserving the national environment, and is a limited valuable resource affecting the harmonious development of agriculture and the national economy, the exercise of the rights to farmland shall be subject to necessary restrictions and obligations, and farmland shall not be subject to speculation (Article 3(1) and (2)).

In full view of such provisions of the former Farmland Act and the above constitutional provisions, the purport of the prohibition of the former Farmland Act in principle is to ensure that farmland can be preserved as farmland by a farmer for the purpose of farming, and that the external capital would facilitate the acquisition of farmland by the farmer by stabilizing the land price by removing incentives to acquire farmland for the purpose of speculation, etc. In addition, in order to achieve such legislative intent, it is reasonable to avoid denying the validity of the farmland lease contract itself, separate from criminal punishment for an offense, thereby realizing the economic benefit according to the terms of the contract, so the provisions of Article 23 of the former Farmland Act prohibiting the lease of farmland shall be deemed to be a mandatory provision. Therefore, even though it does not constitute an exception under Article 23 of the former Farmland Act, the lease contract of this case, which is intended to lease farmland in violation of this provision, shall be null and void.

C. The lower court rejected the Plaintiff’s assertion that the instant lease agreement constitutes grounds for exception under Article 23 subparag. 3 of the former Farmland Act, and, on the grounds indicated in its reasoning, determined that the instant lease agreement is null and void as a farmland lease agreement in violation of Article 23 of the former Farmland Act.

The above determination by the court below is justifiable in light of the legal principles as seen earlier. Contrary to the Plaintiff’s ground of appeal No. 1, it did not err by misapprehending the legal principles on the validity, etc. of farmland lease contracts in violation of Article 23 of

D. On the grounds indicated in its reasoning, the lower court determined that the instant lease agreement was null and void inasmuch as the Defendant would have not concluded a lease agreement on the instant building if he had known that the part concerning each of the instant land was null and void. Examining the record in light of the relevant legal principles, the lower court’s aforementioned determination is justifiable, and contrary to what is alleged in the ground of appeal No. 4, the lower court did not err by misapprehending

3. We examine the Plaintiff’s ground of appeal No. 2.

A. As seen earlier, the lower court determined that the Defendant could not claim damages equivalent to the profits that the Plaintiff occupied and used each of the instant real estate during the instant lease period on the grounds that the leased real estate to the Defendant in violation of Article 23 of the former Farmland Act, which is a mandatory provision, constituted illegal consideration in violation of good morals and social order.

B. However, it is difficult to accept the above determination by the court below for the following reasons.

1) Article 746 of the Civil Act provides that “If a property or a person provides labor for an illegal cause, he/she shall not demand the return of such benefit.” In cases where there exists illegality, a claim for return of unjust enrichment may not be made, on the ground that the act constituting the cause for performance does not constitute a violation of good customs and other social order when considering the content, nature, purpose, or relationship, etc. of the act that is the cause of performance, and not only constitutes a violation of good customs and other social order, but also a case where the performance is remarkably anti-sociality, anti-competitive ethics, and morality, or a case where the performance was performed in violation of the mandatory law but

2) However, although the lease of farmland subject to the application of the former Farmland Act is a farmland subject to the said farmland, there is no intrinsic difference from the general real estate lease in that it is an agreement to allow the use of and benefit from the subject matter and to receive a rent. This is significantly different from the fact that the prop has accepted a tenant as a tenant in excess of the ordinary level of land rent in the past, a substantial portion of the farmland gains in the form of a tenant, or even formation of an status-speed relationship, even though he/she has even formed such relationship. In other words, today’s ordinary farmland lease is subject to special regulations for the sake of the principle of freedom of light and the rational use of farmland, barring any special circumstance, it cannot be readily concluded that the content or nature of the relevant contract itself is obvious

In addition, taking into account the current farmland size and holding status in Korea, the ratio of farmers to the farmland ownership, diversity of reasons for non-farmer ownership, farmland subject to the application of the former Farmland Act includes not only typical farmings such as electric field and field, but also the site for orchard and its affiliated facilities. Considering a large number of social circumstances where land is used differently from the land category, and other all other circumstances, seeking active realization of the terms of the contract, such as claiming the rent based on the farmland lease contract, is not permissible. However, in addition, it cannot be said that the legal purpose of the former Farmland Act is not achieved only if the lessor claims return of unjust enrichment or damages for the occupancy profit equivalent to the rent for the use and profit of the land acquired by the lessee during the lease contract period.

Therefore, even if a farmland lease is in violation of the Farmland Act and its validity cannot be recognized, if the purpose of the lease is to be provided for the purpose for which it is difficult to preserve it as farmland, and it is intended to lose its function as farmland, or if the lessor leases the farmland acquired solely for speculation as part of recovery of invested capital without any intention to self-defiscate, etc., the lessee cannot refuse to return it on the ground of the legal principle of illegal consideration, unless there are special circumstances where it is no relations with the enhancement of agricultural productivity provided for the legitimate purpose of the farmland lease under Article 121(2) of the Constitution, and there is no relations with the rational use of the farmland, and it is clearly contrary to the ideology of the former Farmland Act, and it is obvious that it is against society.

3) Therefore, the lower court should have examined the developments leading up to the Plaintiff’s acquisition of each of the instant land, the cultivation situation before the lease of the instant land exists, the purpose and details of the instant lease agreement, the Defendant’s method of using each of the instant land, etc., and then examined whether the legal doctrine regarding illegal consideration can be applied to the instant lease relationship.

Nevertheless, the lower court rejected the Plaintiff’s counterclaim for offset solely for the reasons indicated in its holding. In so doing, it erred by misapprehending the legal doctrine on illegal consideration, thereby failing to exhaust all necessary deliberations, thereby adversely affecting the conclusion of the judgment. The allegation contained in the grounds of appeal

4. We examine the Defendant’s grounds of appeal.

A. The Defendant’s ground of appeal as to the part of the claim in the principal lawsuit is purporting to dispute the fact-finding of the lower court with respect to the time when each of the instant real estate was returned. In addition, the ground of appeal as to the part of claim for damages among the counterclaim is also purporting to dispute the fact-finding, such as whether the Plaintiff agreed to provide cooperation necessary to register each of the instant land in the farmland ledger. Examining the reasoning of the lower judgment in light of the relevant legal principles and records, the lower court’s determination is justifiable,

B. Furthermore, regarding the return of unjust enrichment and the claim for damages for delay, seeking the return of the advance payment fees for the instant lease contract period, among counterclaims.

According to the decision of the court below, the court below accepted the part of the defendant's counterclaim which claimed "4,50,000 won and the amount at the rate of 5% per annum from December 22, 2012 to September 17, 2013, and 20% per annum from September 22, 2013, and from September 17, 2013 from the next day to the date of full payment," and dismissed the remainder of the claim. The defendant filed an appeal against all of the claims.

However, among the above appeals by the defendant, the appeal on the part cited in the original judgment is unlawful as there is no benefit in the appeal, and the part dismissed in the original judgment does not state any grounds of appeal in the petition of appeal and the appellate brief submitted by the defendant.

5. Therefore, without further proceeding to decide on the remaining grounds of appeal by the Plaintiff, the part against the Plaintiff as to the counterclaim is reversed, and that part of the case is remanded to the court below for further proceedings consistent with this Opinion. The Defendant’s appeal as to that part is dismissed, and the Defendant’s remaining appeal is dismissed. It is so decided as per Disposition by the assent of all participating Justices

Justices Kwon Soon-il (Presiding Justice)