1. In a case where a person who has a legitimate interest in performance, makes a payment by subrogation for the obligor, the subrogation shall acquire the rights to the existing claims and security held by the obligee within the extent of the value of performance by which he has made the payment by subrogation. Therefore, when the obligee has a mortgage on immovables, he shall be liable to have a partial transfer of the mortgage by subrogation

Meanwhile, in principle, a creditor who partially transferred a mortgage has a preferential right to payment to a partial subrogation in the distribution procedure (see, e.g., Supreme Court Decisions 2001Da53929, Jul. 26, 2002; 2001Da2426, Jun. 25, 2004); however, in cases where a separate agreement was made between a partial subrogation and a creditor regarding the order of performance or appropriation of dividends, the method of distributing dividends is determined according to the agreement (see, e.g., Supreme Court Decisions 2005Da1958, Jul. 28, 2005; 2009Da80460, Apr. 8, 2010). If a contract content is written between the parties to a contract as a disposal document, the existence and content of the parties’ intent should be recognized as well, barring any special circumstance, and if the objective meaning of the text is clear, the objective intent and content of the agreement should be reasonably examined in accordance with logical and empirical rules, 160.

2. The reasoning of the lower judgment and the evidence duly admitted reveal the following.

A. The defendant extended 4.9 billion won to B Co., Ltd. (hereinafter referred to as "B") on November 16, 2007, and completed the registration of creation of a mortgage on each real estate (excluding real estate No. 4.) listed in the judgment of the court below in attached Form 1 owned by B and E (hereinafter referred to as "the first priority collateral security" in the list of joint collateral security (No. 2007-639, hereinafter referred to as "the first priority collateral security"). The list No. 74 of Article 7 of the Factory Mortgage Act submitted at the time stated 3,5820,00 won of the appraised amount (950KVA).

B. On June 5, 2008, the Plaintiff and B concluded a credit guarantee agreement of 4.23 billion won with respect to the obligation to repay the principal and interest of loans borrowed from the Defendant for new construction of a factory and the purchase of machinery (hereinafter referred to as “credit guarantee agreement of this case”) on December 5, 2014, and on December 5, 2014, 4.2.3 billion won with respect to the Defendant’s loan of 4.7 billion won for the loan of this case, 4.7 billion won for the loan of this case, 4.7 billion won for the loan of this case, 90 billion won for the loan of this case, 2.7 billion won for each of the above credit guarantee agreements of this case (hereinafter referred to as “credit guarantee agreement of this case”), 30 billion won for each of the above credit guarantee agreements of this case (hereinafter referred to as the “mortgage 2.8 billion won for each of the above credit guarantee agreements of this case”) and 300 billion won or more for each of the above collateral of this case.

D. On November 17, 2008, the Defendant and B entered into a contract on the fixed date transfer security with the machinery purchased by B with the instant collateral loan as the object of transfer security, and with the limit of collateral amount of KRW 5.88 billion, pursuant to paragraph (2) of the instant guarantee agreement, the Defendant and B entered into a contract on the fixed date transfer security with the ceiling of collateral amount of KRW 5.88 billion. On October 15, 2009, B completed the construction of factory buildings, machinery and apparatus, etc., and completed the registration of preservation of ownership as to the factory building No. 1.

E. (1) On October 30, 2009, the Defendant, B, and E purchased with the instant loan (Gantry Crane X2, Rlail, and Basic Construction) 1 type and water transformation equipment (hereinafter “the instant machinery, apparatus, and structure”) were added to the list No. 74 of Article 7 of the Factory Mortgage Act and the list No. 23 of Article 7 of the Factory Mortgage Act on the instant 1st collateral security (hereinafter “instant machinery, apparatus, and structure”) to the effect that each provision of the instant 2nd collateral security agreement is applied to the other matters, and on the same day, the agreement was entered into on the list modification with the content that each provision of the instant 1st and second priority collateral security agreement was applied, and on the same day, the instant machinery, apparatus, and structures were additionally entered in the list No. 74 and No. 233 of Article 7 of the Factory Mortgage Act on the instant 1st and second priority collateral security.

(2) In addition to the second priority mortgage on October 30, 2009, the Defendant and B and C entered into an additional collateral security agreement with regard to each of the real estate and each of the real estate listed in the second priority mortgage on April 4, 2009, with the same content as that of the establishment of the second priority mortgage on the real estate and each of the real estate listed in the second priority mortgage on the same day, and on the same day, the registration of the establishment of the first priority mortgage on each of the above real estate in the Defendant’s name was completed (hereinafter “the additional collateral”).

F. As above, the Defendant added the machines, apparatus and structure of this case as collateral of each list of Article 7 of the Factory Mortgage Act on the First and Second Priority Mortgages, and acquired the instant additional collateral, etc., and decided to terminate the amount of security deposit of KRW 2.64.6 million (2.894 billion x 0.9) out of the amount of security deposit of KRW 70 billion under the credit guarantee agreement between the Plaintiff and the Plaintiff and the Plaintiff, with a view to cancelling the amount of security deposit of KRW 1.82,220,000,000,000,000 won. Ultimately, the amount of security deposit under the credit guarantee agreement of the Plaintiff became KRW

G. (1) If a guarantee accident occurred as B loses the benefit of the period thereafter, the Defendant was subrogated by the Plaintiff on January 13, 2010, the amount of KRW 792,443,698 (the guarantee amount of KRW 781,380,000 + interest of KRW 11,063,698) in accordance with the instant credit guarantee agreement.

(2) On January 13, 2010, the Plaintiff and the Defendant concluded a contract under which the Defendant partially transferred the instant second priority collective security and the instant additional collective security (hereinafter referred to as the “instant partial transfer contract”) to the Plaintiff upon the Plaintiff’s partial subrogation.

On the other hand, Article 2 of the contract for partial transfer of the right to collateral security of this case provides that (i) regarding the above right to collateral security, the transferor shall be given preferential payment for the loan of this case on June 5, 2008 among the remaining claims of the transferor (defendant) as of the date of distribution, and for the overdue interest on the loan of this case until the date of performance of the guaranteed obligation and the agreed interest on the difference between the transferor and the agreed interest on the loan of this case shall be paid in preference only to the difference between the transferor and the agreed interest on the loan of this case as of June 5, 2008; and (ii) the transferor shall be paid in proportion to the portion of the obligation of the transferor and the portion of the obligation of the transferee (Plaintiff) in proportion to the partial transfer of the right to collateral security of this case, regardless of the transferor's other loans (Paragraph 2).

(3) On January 21, 2010, part of the instant right to collateral security was registered with additional registration for the repayment amounting to KRW 792,443,698 with respect to the instant second-class right to collateral security and the instant additional right to collateral security, and each of the instant right to collateral security, the Plaintiff of the right to collateral security.

H. (1) The Defendant applied for the auction of real estate rent to Changwon District Court A through the Changwon District Court A, and the auction court prepared the distribution schedule of each of the following cases (hereinafter referred to as “the distribution schedule”) with respect to KRW 7,105,61,635, which remains after deducting the execution expenses from the total amount of KRW 5,264,60,00, the sales price for each real estate, machinery, structure, structure, etc. as stated in the above attached Forms 1, 201, which is the date of distribution, and the proceeds of sale for the machinery, equipment, structure, etc. of this case, which is the date of distribution, from the total of KRW 7,105,105,611,635, which remains after deducting the execution expenses from the total amount of KRW 5,264,605, which is the date of distribution, in the second order, KRW 9,721,510, and KRW 1,492,030, and KRW 47,0925,95

(2) The Plaintiff appeared on the aforementioned date of distribution, and raised an objection against KRW 400 million out of the amount of distribution to the Defendant among the distribution schedule of this case, and filed the instant lawsuit on May 3, 201.

3. Examining these facts in light of the legal principles as seen earlier, it is determined as follows.

A. Under Article 2(1) and (2) of the instant contract for partial transfer of collateral security, the Plaintiff and the Defendant, the creditor, who was a partial subrogation, agreed on the order of distribution of dividends or appropriation of dividends in connection with the instant loan of the guaranteed collateral. Thus, barring any other circumstance, when preparing the instant distribution schedule in the said voluntary auction procedure, the order and method of distribution should be determined in accordance with the agreement.

B. (1) According to Article 2(1) of the instant contract for partial transfer of a right to collateral security, the Plaintiff and the Defendant agreed to cover the balance of the right to physical loan of each of the instant guaranteed claims and the Defendant, within the scope of the amount divided in proportion to the ratio of 9:1 of the Plaintiff and the Defendant’s initial guarantee ratio, to the remainder, within the scope of the amount divided in proportion to the amount distributed among the Plaintiff and the Defendant’s initial guarantee ratio.

(2) Meanwhile, the Plaintiff and the Defendant agreed to acquire the instant machines, instruments, and structures purchased by B with the instant guaranteed loan by setting up a first-class collateral under the Factory Mortgage Act, unlike the above agreement, the Defendant and B, unlike the above agreement, included the instant machines, instruments, and structures in the list under Article 7 of the Factory Mortgage Act on the instant second-class collateral security loan, and included them in the list under Article 7 of the Factory Mortgage Act on the instant first-class collateral security loan. Accordingly, the instant machines, instruments, and structures purchased with the instant guaranteed loan, which are different from the instant guaranteed loan, was added as a collateral for the instant secured claim on the instant first-class collateral, which is a claim different from the instant secured loan.

However, Article 2(2) of the instant contract for partial transfer of a right to collateral security was agreed to preferentially cover the instant secured loan, notwithstanding the Defendant’s other loans, with respect to the dividends, etc. recovered from the security acquired due to the instant secured loan. This is separate from the Defendant’s other loans under Article 2(1) of the instant contract for partial transfer of a right to collateral security, and the circumstances where the subject of the application is not specifically restricted, and as such, in light of the circumstances where the instant machinery, apparatus, and structure were added as the security for the instant secured loan, it is reasonable to deem that the instant contract for partial transfer of a right to collateral security applies to the instant machinery, apparatus, and structure purchased from the instant secured loan and secured by the instant secured loan.

Ultimately, according to Article 2(2) of the instant contract for partial transfer of collateral security, even though the machinery, apparatus, and structure of this case were added as a collateral for the instant collateral security, since the machinery, apparatus, and structure of this case are secured by the purchase of the instant collateral loan from the instant collateral security loan, the dividends equivalent to the proceeds of sale recovered therefrom must be preferentially appropriated for the instant collateral security loan, notwithstanding the instant first collateral security or the right to the secured body. Therefore, as an auction court which prepares the instant collateral security, (1) as an auction court which has established the instant collateral security, shall appropriate the proceeds of sale of the real estate and each of the above attached Table 2, which are the collateral for the instant additional collateral security, to the claims for the instant collateral loan, which is the secured claim, and the proceeds of sale of the machinery, apparatus, and structure of this case shall also be appropriated preferentially for the claims for the instant collateral security loan, and (2) furthermore, from the total proceeds appropriated to the Defendant, the amount of accrued claims and interest related to partial termination by the instant guarantee agreement should have been distributed to the Defendant and the remainder amount to the Plaintiff and the Defendant.

4. Nevertheless, the court below rejected the Plaintiff’s assertion that the sales price of the machinery, apparatus, and structures of this case secured by a loan of the instant guaranteed collateral by erroneous interpretation of Article 2(2) of the instant collateral security agreement should be preferentially distributed to the Defendant, who is the primary mortgagee of the instant case, and that the sales price of the machinery, apparatus, and structures should be preferentially apportioned to the Defendant, who is the primary mortgagee of the instant case, should be appropriated for the loan of the instant guaranteed collateral and calculated the amount of dividends

Therefore, the judgment of the court below is erroneous in the misapprehension of legal principles as to the agreement and interpretation of the provision on the appropriation of dividends between some of the alternative violators and creditors, or by misapprehending the principle of free evaluation of evidence in violation of logical and empirical rules, thereby adversely interpreting Article 2(2) of the Act on Partial Transfer of Mortgage, which affected the conclusion of the judgment. The ground of appeal assigning this error is with merit.

5. Therefore, the lower judgment is reversed, and the case is remanded to the lower court for further proceedings consistent with this Opinion. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Kim In-bok, Counsel for the defendant