[2] In a case where the council of occupants' representatives entered into a delegation contract with the attorney-at-law to file a lawsuit on defect repair against the business proprietor, etc. who constructed and sold the apartment, and the council of occupants' representatives transferred the apartment to the household, and notified the termination of the delegation contract to the Gap on the ground that the council of occupants' representatives failed to investigate and incomplete report on defect investigation was made, and the Gap sought reimbursement of the litigation expenses and defect diagnosis expenses incurred until the council of occupants' representatives against the council of occupants' representatives, the case holding that even if the delegation contract was terminated due to the reasons attributable to the Gap, the above litigation expenses and defect diagnosis expenses are reasonable expenses incurred in performing the duties until the termination of the delegation contract, and the council of occupants' representatives is obliged to pay them to the Gap under Article 688(1) of the

1. Regarding ground of appeal No. 1

Based on its stated reasoning, the lower court determined that the Plaintiff neglected to investigate the Plaintiff’s transfer of the instant apartment and the Defendant’s rescission of the instant delegation contract was justifiable.

In light of the relevant legal principles and the evidence duly admitted, the lower court did not err by misapprehending the legal doctrine, failing to exhaust all necessary deliberations, or violating the rules of evidence, etc.

2. Regarding ground of appeal No. 2

A. Even if the contract is terminated as the fiduciary relationship was destroyed due to a cause attributable to the mandatary during the process of delegated affairs in relation to the delegated affairs, and thus it becomes impossible to manage the entrusted affairs any longer, the mandator is obligated to pay reasonable remuneration and reasonable expenses for the entrusted affairs in consideration of various circumstances, such as the degree and difficulty of the entrusted affairs performed by the mandatary at the time of termination of the contract, degree of efforts made by the mandatory to handle the affairs, degree of the entrusted person’s efforts to handle the affairs, and the interests of the delegated person with respect to the entrusted affairs (see, e.g., Supreme Court Decisions 2006Da32460, Dec. 11, 2008; 2010Da52584, Jun. 14, 2012).

B. As to the Plaintiff’s assertion that, since the Defendant terminated the delegation contract of this case without any justifiable reason, the Plaintiff should pay the expenses related to the lawsuit claiming damages against the business entity, etc. regarding the defect of the instant apartment (hereinafter “instant prior lawsuit”), the lower court determined that the Plaintiff’s assertion was groundless since the Defendant terminated the delegation contract of this case.

C. However, we cannot accept the above determination by the court below for the following reasons.

(1) Review of the reasoning of the first instance judgment as cited by the lower court and the record reveals the following facts.

(A) On April 4, 2012, in order to file the instant prior suit, the Defendant entered into a delegation contract with the Plaintiff, which delegates the duties of performing the said lawsuit to the Plaintiff (hereinafter “instant delegation contract”).

(B) Article 3(1) of the instant delegation contract provides that “The Plaintiff shall pay all the litigation expenses, such as stamp fee, service fee, court verification and appraisal fee, guarantee deposit, execution fee, and other expenses incurred in performing the delegated affairs.” Article 6 of the instant delegation contract provides that “The above litigation expenses, etc. paid by the Plaintiff on behalf of the Plaintiff shall be preferentially recovered from the winning amount, which are the amount not included in the contingent fee.” In addition, Article 10(1) provides that “The Defendant shall be deemed to have won the case where there are circumstances, such as the termination of the delegation contract at will by the Defendant, and the Plaintiff shall be paid the full amount of the remuneration and the full amount of the litigation expenses paid to the Plaintiff.” In addition, Article 10(1) provides that “The defect diagnosis conducted by Meat C&C shall be KRW 30 million (Additional dues) and the cost of defect diagnosis shall be settled in advance and in the winning amount.”

(C) In order to carry out the instant prior suit, the Plaintiff spent KRW 2,842,620,00, the sum of KRW 459,00, KRW 183,60, KRW 183,60, KRW 200, and KRW 2,200,020, such as the cost of transportation, and the cost of printing books. Of the residents 1,084, the Plaintiff continued to take the procedure for receiving the claim for damages from 847 households.

(D) On April 24, 2012, the Plaintiff paid KRW 33 million at the defect diagnosis cost to Meart C&C Co., Ltd. (hereinafter “Meart C&C”), which was selected as a defect diagnosis company, and thereafter, Meart C&C conducted an investigation upon hand over to 668 households among the apartment households of this case, and prepared and submitted a defect inspection report to the Defendant.

(E) On May 3, 2013, the Defendant notified the Plaintiff that the instant delegation contract was terminated on the grounds of the failure to conduct an investigation and the incomplete report on defect investigation.

(2) We examine the above facts in light of the legal principles as seen earlier.

(A) The provisions of Articles 3(1), 6, and 10 of the delegation contract of this case are the purport that the subject of the litigation costs, such as defect diagnosis costs, should first be borne by the Plaintiff on the premise that the subject of the litigation costs, such as the cost of defect diagnosis, is the Defendant, and shall be settled at the expense by deducting the same from the winning money after the completion of the litigation. It seems to be merely the time and method of the reimbursement of the cost under the premise that the Defendant

(B) As seen earlier, even if the delegation contract of this case was terminated during the course of performing delegated affairs due to the Plaintiff’s cause attributable to the mandatary, it is reasonable to make efforts to manage the delegated affairs, such as that the Plaintiff was transferred the damage claim from 847 residents for the performance of the prior suit of this case (78% of all household units), and that the household which conducted the transfer inspection upon the transfer of the case to 668 household units (6% of all household units), and that the above-mentioned work is deemed to be a considerable benefit to the Defendant. Therefore, it is reasonable to view the above litigation costs as the cost necessary for the Plaintiff’s performance of the delegated affairs until the termination of the delegation contract of this case. Accordingly, the Defendant is obliged to pay it to the Plaintiff under Article 688(1) of the Civil Act.

(3) Nevertheless, the lower court determined otherwise on the grounds indicated in its reasoning that the Plaintiff could not claim the above litigation cost and defect diagnosis cost against the Defendant. In so determining, the lower court erred by misapprehending the legal doctrine regarding the interpretation of a contract and the mandatory’s right to claim reimbursement of expenses, etc., thereby adversely affecting the conclusion of the judgment.

3. Conclusion

Therefore, the part of the judgment below against the plaintiff regarding the costs of lawsuit and defect diagnosis costs is reversed, and that part of the case is remanded to the court below for a new trial and determination, and the remaining appeal is dismissed. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Kim Seon-soo (Presiding Justice)