mountainous District Court Decision 200

Attorney Lee In-Gyeong, Attorneys Lee Jae-Gyeong, Lee Jae-in, and Park Jong-tae

Law Firm Ringrop LLC, Counsel for the plaintiff-appellant

Attorney Lee In-tae, Counsel for defendant-appellant

1. Regarding ground of appeal No. 1

A. In the case of the cancellation of a contract due to the so-called “in the case of a refusal of performance” in which the intention of refusal is expressed in advance due to the nonperformance, the requirements for the cancellation of a contract are very mitigated when compared with the rescission at the time of the delay of performance because the other party’s peremptory notice and simultaneous performance are not required. Thus, in order to recognize an implied intention of refusal of performance by taking into account the various circumstances after the time of the contract or after the contract, in addition to the case where the intention of refusal of performance is explicitly expressed, the intention of refusal must be clearly recognized in light of the circumstances (see, e.g., Supreme Court Decisions 2004Da22971, Nov. 9, 2006; 2010Da7385, Feb. 10, 2011).

B. The lower court determined as follows: (a) the instant sales contract was concluded verbally on May 29, 2006, and there was no fixed time for the payment of the remainder after the payment of the down payment and the intermediate payment; (b) the Plaintiff requested the payment of the remainder within 14 days after the expiration of the nine-year period; (c) the Plaintiff cannot be deemed to have clearly refused the payment of the remainder; and (d) the Plaintiff did not explicitly expressed its intention that “the Plaintiff would not pay the remainder to the Defendant” or “the cancellation of the instant sales contract,” and on the contrary, it is difficult to deem that the Plaintiff explicitly refused the instant sales contract solely on the grounds that the Plaintiff requested the payment of the remainder within 14 days after the expiration of the nine-year period.

C. In light of the above legal principles and records, the above determination by the court below is just, and contrary to what is alleged in the grounds of appeal, there were no errors of exceeding the bounds of the principle of free evaluation of evidence against logical and empirical rules, or of misapprehending the legal principles

2. As to the grounds of appeal Nos. 2 through 4

A. In the rescission of a contract based on delay of performance, the peremptory notice of performance, which is a prerequisite for such delay of performance, is not necessarily required to be given for a specified period, and the right of rescission becomes effective upon the lapse of a reasonable period from the time of peremptory notice (see, e.g., Supreme Court Decision 94Da35930, Nov. 25, 1994). Furthermore, even if the period fixed by one of the parties upon peremptory notice of performance is not reasonable, it is recognized as a peremptory notice of performance, and the right

In addition, if a party’s performance of one party’s own obligation is strictly required in a bilateral contract, it may be said that the degree of offer for performance to be made by the party would rather be against the principle of trust and good faith depending on the time and specific circumstances. Therefore, in cases where the purchaser was aware of the preparation for receipt of documents for registration of transfer of ownership as he/she did not prepare for payment of the remaining amount, the seller is also sufficient to prepare for performance corresponding thereto (see, e.g., Supreme Court Decisions 95Da40397, Dec. 22, 1995; 2012Da65867, Nov. 29, 2012).

B. Review of the reasoning of the lower judgment and the record reveals the following facts.

1) On May 29, 2006, the Plaintiff concluded the instant sales contract with the Defendant to purchase the instant land in KRW 260 million, and paid KRW 25 million to the Defendant as the down payment. At the time of and after the conclusion of the instant sales contract, the Plaintiff and the Defendant did not prepare the sales contract in writing, and did not set the period of payment or the payment of the intermediate payment or the remainder, or the period during which the ownership transfer registration is due. On August 8, 2006, the Plaintiff paid KRW 15 million to the Defendant as the part payment.

2) On June 22, 2015, the Plaintiff filed an application with the Defendant for a provisional injunction against the disposal of real estate regarding the instant land as the District Court Decision 2015Kadan2158, and received a decision of acceptance on June 22, 2015.

3) On July 3, 2015, the Defendant: (a) as a seller of the instant sales contract, the Defendant completed the preparation for the implementation thereof; and (b) notified the Defendant to pay the purchase price within 14 days from the date of receipt of the notification. In the event the Plaintiff neglects his/her obligation within 14 days from the date of receipt of the notification, the Defendant sent the Plaintiff a certificate of personal seal impression for real estate sale along with the content that the contract will be rescinded; and (c) the above content certification was served on the Plaintiff on the 6th of

4) On July 13, 2015, the Plaintiff sent a written reply to the Plaintiff, stating that “The remaining payment date shall not exceed the end of August, 2015 due to a difficult relationship with the Plaintiff,” but did not prepare any balance by the end of August, 2015, which was voluntarily promised.

5) On July 20, 2015, the Defendant sent to the Plaintiff proof of the content that the instant sales contract was rescinded, but was not served on the Plaintiff. On July 23, 2015, the Defendant sent a text message that the instant sales contract was rescinded to the Plaintiff.

6) On July 20, 2015, the Defendant filed an application against the Plaintiff for an order to file a lawsuit against the instant provisional disposition with the District Court 2015Kaman95, and filed an application for filing a lawsuit against the Plaintiff for provisional disposition under the same court 2015Kadan3272 on September 2, 2015.

7) On the other hand, on July 23, 2015, the Plaintiff sent a postal money order of KRW 20 million at the face value to the Defendant, and filed the instant lawsuit against the Defendant on November 13, 2015, where the purchase price was not paid. 8) The Defendant declared that the instant sales contract will be rescinded in the reply submitted to the first instance court on January 5, 2016, which reached the Plaintiff around that time. The Defendant returned the postal money order received from the Plaintiff on February 23, 2016.

9) The Plaintiff deposited the Defendant as the principal deposit, KRW 20 million on March 7, 2016, and KRW 200 million on September 20, 2016, respectively.

10) Meanwhile, the instant land is not subject to provisional attachment registration or collateral security registration. Examining the foregoing facts in light of the legal principles as seen earlier, the Plaintiff did not prepare any balance from the date nine years have elapsed since the conclusion of the instant sales contract until June 2015 upon receipt of the provisional disposition of prohibition of disposal of the instant land. Moreover, the Defendant did not prepare any balance from the due date set by the performance peremptory notice as of July 3, 2015, as well as from the due date set by the Plaintiff’s own promise by the end of August 2015. On the other hand, the Defendant appears to have kept the registration rights necessary for the registration of ownership transfer, the certificate of personal seal impression for real estate sale stated as the purchaser was already issued on July 3, 2015, and the sales contract can be easily prepared if the Plaintiff pays any balance, and it is reasonable to deem that the Defendant prepared for performance corresponding to the Plaintiff’s performance on July 3, 2015. Therefore, even if the Defendant received the remainder within the period of 10th of the Plaintiff’s notice of acceptance.

Furthermore, in light of the progress after the contract of this case was concluded, the Defendant’s withdrawal of the intention to cancel the contract merely because the Defendant kept approximately seven months a postal money order of KRW 20 million without exchanging in cash the postal money order of KRW 10,000,000 which is merely about 10% of the balance.

D. Nevertheless, the lower court determined otherwise that the Defendant did not offer a sales contract in writing on the ground that the Defendant did not demand or cooperate therewith, and rejected the Defendant’s assertion that the instant sales contract was lawfully rescinded due to the Plaintiff’s delay of performance. In so doing, the lower court erred by exceeding the bounds of the principle of free evaluation of evidence in violation of logical and empirical rules, or by misapprehending the legal doctrine on the provision of self-performance of obligations and the withdrawal of declaration of intent to cancel a contract in a bilateral contract, thereby adversely affecting the conclusion of the judgment. The grounds of appeal assigning this error are with merit.

3. Conclusion

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 Lee Dong-won

Justices Park Jong-young

Justices Kim Gin-soo