[2] The meaning and scope of "expenses" under Article 479 (1) of the Civil Code, which provides for the order of appropriation of performance to the expenses, interest, and principal and the scope thereof

[3] The time when the part of the litigation costs paid by the creditor is decided

[2] If a debtor pays expenses and interest of one or more obligations, and the person performing the performance has effected performance which has failed to extinguish the entire obligation, such performance shall be appropriated in the order of the expenses, the interest and the principal (Article 479(1) of the Civil Act). The expenses here refer to the expenses to be borne by the debtor in connection with the pertinent obligation in accordance with the agreement between the parties or the provisions of the law. Therefore, the expenses for performance (main sentence of Article 473 of the Civil Act) to be borne by the debtor, or the expenses for performance of the creditor's right which are confirmed to be borne by the debtor by the determination of the amount of the lawsuit costs

[3] In a trial closing a case in principle, the court shall render ex officio a judgment on the whole costs of lawsuit at that instance (Article 104 of the Civil Procedure Act), but where the amount is not determined in a trial determining the burden of litigation costs, the court of the first instance shall determine the amount of litigation costs by decision upon receiving an application from a party after the judgment either becomes final or after the judgment bears an executory power over the costs of lawsuit (Article 110(1) of the same Act), and any party may file an immediate appeal against such decision (Article 110(3) of the same Act). Accordingly, the detailed details, amount, etc. of the part to be borne by the debtor among the costs of lawsuit paid by the creditor can

1. As to the Defendant’s Intervenor’s ground of appeal

In light of the reasoning of the judgment of the court of first instance, the court below determined that the application for intervention in the succession of this case was unlawful on the ground that there was no evidence to prove that the intervenor duly assumed the obligation with the consent of the plaintiff, a creditor, did not meet the requirements for intervention, and that the application for intervention in the succession of this case was unlawful on the ground that the intervenor did not meet the requirements for intervention.

In light of the records, the above determination by the court below is justifiable. The court below did not err by misapprehending the legal principles as to participation in succession as alleged in the grounds of appeal.

2. As to the Defendant’s ground of appeal

A. As to the validity of the loan transaction agreement of this case

According to the adopted evidence, the court below rejected the defendant's assertion, that the defendant is a member of the ○ Credit Cooperative, and that the defendant's loan to the defendant is not denied even if the loan to the defendant is illegal because it is not a member of the ○ Credit Cooperative, and thus it violates the relevant Acts and subordinate statutes, such as the Act on the Regulation of Conducting Unauthorized Receipt of Loans, and thus, the defendant is not liable for the repayment of the loan of this case.

In light of the records, the fact-finding and judgment of the court below are justifiable. The court below did not err by misapprehending legal principles as alleged in the grounds of appeal.

B. As to the appropriation of performance

The court below determined that the defendant is jointly and severally liable with the non-party 1 to pay the plaintiff 25 million won of the loan of this case and interest and delay damages for the loan of this case, and the plaintiff 1,721,941 of which the intervenor paid 5 million won to the plaintiff on behalf of the defendant in subrogation of the defendant, and the remaining amount is the legal expenses, the interest calculated at the rate of 12.5% per annum from November 7, 2002 to December 6, 2002, and the interest and delay damages calculated at the rate of 19% per annum from December 7, 2002 to September 10, 203. Thus, the defendant is jointly and severally liable with the non-party 1 to pay damages for delay to the plaintiff at the rate of 19% per annum from September 11, 2003 to December 6, 2002.

However, it is difficult to accept the part of the lower court that determined that KRW 1,721,941 out of the Intervenor’s subrogated payment of KRW 5 million was appropriated as the expense for the instant loan obligations.

If a debtor pays expenses and interest of one or more obligations, and the person performing the performance has to pay the entire obligation, such expenses shall be appropriated in the order of the expenses, interest and originals (Article 479(1) of the Civil Act). Here, the expenses refer to the expenses to be borne by the debtor in connection with the relevant obligations pursuant to an agreement between the parties or the provisions of Acts. Therefore, the expenses for performance to be borne by the debtor (main sentence of Article 473 of the Civil Act) or the expenses for lawsuit or execution which are confirmed to be borne by the debtor by the determination of the amount of litigation costs or by the determination of the amount of execution costs out of the expenses for the exercise of rights of the creditor (see Supreme Court Decision 2004Da818, Oct. 12, 2006). However, even if the expenses for performance are the expenses for lawsuit, the amount increased by the creditor's address or by any other act, and thus, the expenses for lawsuit cannot be considered as those to be borne by the debtor ex officio after such determination (Article 10 of the Civil Procedure Act).

On January 17, 2007, before the judgment of the court of first instance was rendered after the filing of the lawsuit in this case, the Plaintiff asserted that KRW 1,721,941 from the Intervenor was appropriated for the litigation costs in this case (record 391, page 394). However, there is no evidence to confirm specific details or legal character of KRW 1,721,941 in the record, and it is difficult to conclude that it constitutes the cost to be borne by the Defendant, the obligor, according to an agreement or legal provision between the Plaintiff and the Defendant. Furthermore, it is evident in the record that the court below has not yet become final and conclusive. Nevertheless, the court below erred in the misapprehension of the legal principles as to the principal and interest of this case without examining and determining whether the amount claimed by the Plaintiff as the litigation costs in this case could be included in the expenses to be borne by the Defendant even before the completion of the procedure for determining the amount of the litigation costs in this case.

3. Conclusion

Therefore, the Defendant’s successor’s appeal is dismissed, and the part of the judgment below against the Defendant is reversed, and this part of the case is remanded to the court below for a new trial and determination. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Lee Hong-hoon (Presiding Justice)