[2] Whether the owners of residential buildings in a residential environment improvement district designated under the former Act on Temporary Measures for the Improvement of Residential Environments as residents of low-income urban areas fall under the category of "persons subject to relocation measures" under Article 78 (1) of the former Act on the Acquisition of Land, etc. for Public Works and the Compensation therefor (negative)

1. As to the scope of public works and persons subject to relocation measures

A. (1) Article 2 Subparag. 2 of the former Act on the Acquisition of Land, etc. for Public Works and the Compensation therefor (amended by Act No. 8665 of Oct. 17, 2007; hereinafter “former Public Works Act”) provides that “public works mean the projects falling under any of the subparagraphs of Article 4,” and Article 4 Subparag. 5 provides that “the projects concerning the construction of houses or the creation of housing sites conducted by the State, local government, government-invested institution, local public enterprise, or a person designated by the State or local government for the purpose of lease or transfer” and subparagraph 7 provides that “other projects that can expropriate or use land, etc. under other Acts.”

Meanwhile, the former Act on Temporary Measures for the Improvement of Dwelling Conditions for Low-Income Urban Residents (repealed by Article 2 of the Addenda to the Act on the Maintenance and Improvement of Urban Areas and Dwelling Conditions for Residents, Act No. 6852, Dec. 30, 2002; hereinafter “former Act on Temporary Measures”) provides that a project implementer shall implement a residential environment improvement project after designating the relevant area as a residential environment improvement district in order to improve the residential environment of low-income urban residents whose residential environment is poor, and allow the head of a Si (including the Special Metropolitan City Mayor and the Metropolitan City Mayor)/Gun (hereinafter “head of a Si, etc.”) to implement a residential environment improvement project, such as the construction of housing or the maintenance of public facilities; however, when the Minister of Construction and Transportation deems it necessary to implement a residential environment improvement project urgently due to a natural disaster or other causes, he/she may, at the request of the Special Metropolitan City Mayor, the Metropolitan City Mayor or the Do governor, or, at the request of a public corporation established by carrying out a residential environment improvement project (hereinafter “Korea Housing Corporation, etc.”).

In addition, according to Article 10(4) of the former Temporary Measures Act and Article 8 [Attachment 3] of the Enforcement Decree of the Act on Temporary Measures for Residential Environment Improvement for Low-Income Urban Residents (repealed by Article 2 of the Addenda of the Enforcement Decree of the Act on the Maintenance and Improvement of Urban Areas and Dwelling Conditions for Residents, June 30, 2003; hereinafter “former Enforcement Decree of the Temporary Measures Act”), the owner of a building who is scheduled to construct a house in the relevant residential environment improvement district as of the base date under Article 9(1) of the former Enforcement Decree of the Act on Temporary Measures for Residential Environment Improvement (hereinafter “former Enforcement Decree of the Temporary Measures Act”) may be supplied with a house for sale or a long-term lease, and the tenant who resides in the relevant residential environment improvement district

(2) In full view of the content, form, purport, etc. of such relevant laws and regulations, residential environment improvement projects under the former Temporary Measures Act shall be deemed to fall under “project concerning the construction of housing for the purpose of lease or transfer” under Article 4 subparag. 5 of the former Public Works Act or “project that can expropriate or use land, etc. under other Acts” under Article 4 subparag. 7 of the same Act.

B. Meanwhile, Article 78(1) of the former Public Works Act provides that "a project operator shall either establish and implement relocation measures or pay resettlement funds to a person who is deprived of his/her base of livelihood due to the implementation of public works (hereinafter "person subject to relocation measures"), as prescribed by Presidential Decree, for the person who is deprived of his/her base of livelihood due to the provision of a residential building due to the implementation of the public works (hereinafter "person subject to relocation measures"). The said relocation measures are prepared to restore the previous living condition of a person subject to relocation measures that is deprived of his/her base of livelihood due

However, the residential environment improvement project is to improve the residential environment of the entire low-income urban residents in the relevant project district, not to lose the basis of living, but rather to be sold or leased a house built in the relevant project. In particular, even if the owners of residential buildings in the project district have to provide residential buildings due to the implementation of the residential environment improvement project corresponding to the public works, they may temporarily enjoy preferential rights to purchase or lease a house to be constructed by the relevant project at their option, and it does not require the owners of land or buildings to reside in the project district. Therefore, the housing should be sold or leased regardless of whether the basis of living is lost or not.

Furthermore, according to Articles 11(1) and 13(1) and (2) of the former Temporary Measures Act, the land owned by the State or a local government in a residential environment improvement zone shall be deemed to be abolished from the date when the housing environment improvement plan is publicly announced, and the land is transferred without compensation to the implementer of a residential environment improvement project, notwithstanding the provisions of the State Property Act, the Local Finance Act, and other relevant Acts and subordinate statutes on the management and disposal of State or public property, and the State and the local government may provide a subsidy or loan to the owner of the land or building in a residential environment improvement zone, the construction of the site, the construction of the building, the improvement of the building, and other expenses incurred in the residential environment improvement project in the National Treasury or local government finance established under the Housing Construction Promotion Act. In this case, the State and the local government can provide the project implementer with a part of the required expenses, so the housing constructor's sale price of the housing constructed by the project is generally lower than the housing environment improvement project without such subsidies, and the owner of the residential building shall continue to meet the existing residential environment improvement expenses.

In addition, according to Article 4(2) of the former Ad Hoc Measures Act and Article 4(2) of the former Enforcement Decree of the Ad Hoc Measures Act, the implementation of public works, such as housing site development projects, requires the consent of at least 2/3 of the total number of persons who own land or buildings in the relevant area as of the base date for designation of a residential environment improvement district, and the consent of at least 1/2 of the total number of tenants who reside in the relevant area for at least three months as of the base date, and the consent of at least 1/2 of the total number of tenants who reside in the relevant area is not provided by all residents in the project district.

In full view of the contents, form, purpose, etc. of the relevant laws and regulations including these various circumstances, it is reasonable to view that the owners of residential buildings in a residential environment improvement zone who have concluded a contract for the sale of houses to be constructed by the said project do not constitute a person subject to relocation measures under Article 78(1) of the former Public Works Act, that is, a person who is a person subject to the provision of residential buildings due to the implementation

C. After compiling the adopted evidence, the lower court acknowledged the facts as indicated in its reasoning, and determined that the instant residential environment improvement project does not constitute public works, and that the Plaintiff and the Intervenor succeeding to the Plaintiff who succeeded to the status of the sales contract from the residents within the residential environment improvement district of the instant case cannot be treated equally as those subject to the relocation measures stipulated in Article 78(1) of the former Public Works Act, and that the Defendant, who is the project implementer of the instant case, should not be deemed to have the Plaintiffs and the Intervenor succeeding to the Plaintiff bear the ownership

In light of the above legal principles, relevant statutes, and records, the lower court’s determination that the instant residential environment improvement project does not constitute a public project is justifiable in its conclusion that the Plaintiffs and the Plaintiff-Successor did not constitute a person subject to relocation measures under Article 78(1) of the former Public Works Act. In so doing, it did not err by misapprehending the legal doctrine on the scope of a person subject to relocation measures under Article 78(1) of the former

2. As to whether the sale price was a deception

In a case where the material facts of a transaction were falsely notified in a manner to the extent to which it would be subject to criticism in light of the duty of good faith with respect to the publicity and advertisement of a product, it constitutes a deception. However, it should be deemed that the mere exaggeration in the advertisement or advertisement is somewhat false, and that there is a lack of deception as long as it may be acceptable in light of the general commercial practice and the good faith principle (see, e.g., Supreme Court Decisions 99Da55601, May 29, 2001; 2009Da97864, Apr. 29, 2010).

After compiling the adopted evidence, the lower court acknowledged the facts as indicated in its holding, and determined that the Defendant could not be deemed as deceiving that the sales price would not exceed the construction cost in concluding the sales contract for the housing of this case between the Plaintiffs and the Plaintiff that withdrawn.

In light of the above legal principles and records, the above judgment of the court below is just, and there is no error in the misapprehension of legal principles as to deception of sale price.

3. Conclusion

Therefore, all appeals are dismissed, and the costs of appeal are assessed against the losing party. It is so decided as per Disposition by the assent of all participating Justices on the bench.

[Attachment] List of Plaintiffs: omitted

Justices Shin Young-chul (Presiding Justice)