[1] In a case where the obligor had a claim against the other party in a set-off prior to the closing of argument in the final and conclusive judgment, but the declaration of intention of set-off was made after the closing of argument, whether such declaration constitutes a legitimate ground for objection

[2] Where a garnishee has extinguished a seizure claim due to repayment to the legitimate collection authority, execution deposit, set-off, etc. when the seizure of the claim competes with each other, the scope of the creditors having its effect

[3] Requirements for a third party obligor’s deposit under Article 505(1) of the former Civil Procedure Act (i.e., seizure) and the amount to be deposited in such case (i.e., the whole amount of debt) and whether the distribution procedure is valid in a case where the third party obligor’s deposit is completed with respect to the deposit whose effect of execution deposit is not recognized because it did not deposit the full amount of debt (affirmative

[1] Article 505 (2) of the former Civil Procedure Act (amended by Act No. 6626 of Jan. 26, 2002) (see current Article 44 (2) of the Civil Execution Act), Articles 492 and 493 of the Civil Act / [2] Articles 563 (see current Article 229), 565 (see current Article 232 of the Civil Execution Act) of the former Civil Procedure Act (amended by Act No. 6626 of Jan. 26, 2002) / [3] Article 581 (1) of the former Civil Procedure Act (amended by Act No. 6626 of Jan. 26, 2002) (see current Article 248 (1) of the Civil Execution Act)

[1] Supreme Court Decision 66Da780 delivered on June 28, 1966 (No. 14-2, 101), Supreme Court Decision 98Da25344 delivered on November 24, 1998 (Gong199Sang, 9) / [2] Supreme Court Decision 86Da4388 delivered on September 9, 1986 (Gong1986, 1306), Supreme Court Decision 200Da43819 delivered on March 27, 2001 (Gong2001Sang, 996), Supreme Court Decision 2001Da10748 delivered on May 30, 2003 (Gong203Ha, 1424) / [3] Supreme Court Decision 2002Da2704264 delivered on July 22, 2004

Hong Young-young

Korea Tech Co., Ltd. (Attorney Yoon-ho, Counsel for the plaintiff-appellant)

Supreme Court Decision 2002Da22700 Delivered on July 22, 2004

Seoul High Court Decision 2004Na54871 Delivered on June 23, 2005

All appeals are dismissed. The costs of appeal are assessed against each party.

We examine the grounds of appeal.

1. As to the Defendant’s ground of appeal

A. As to whether the deduction of defect repair expenses claims, etc. is legitimate

Even if both parties’ obligations are offset by each other, the effect of the extinguishment of the obligation due to a offset does not take effect only by itself, but also by the effect of the extinguishment of the obligation due to the offset only after the declaration of intent of offset is waited. Thus, even if the obligor had a claim on the offset against the other party before the closing of argument in the final and conclusive judgment, which is a title holder of the obligation, if the obligor expressed his/her intent of offset only after the closing of argument in the final and conclusive judgment, it constitutes “when the cause of objection arises after the closing of argument” as stipulated in Article 505(2) of the former Civil Procedure Act (amended by Act No. 6626 of Jan. 26, 2002), and thus, it constitutes legitimate claim without relation, regardless of whether the parties had known the existence of the automatic claim prior to the closing of argument in the final and conclusive judgment (see Supreme Court Decision 98Da25344, Nov. 24, 1998).

According to the records, 97,024,00 won for defect repair expenses, 200 million won for delay compensation, 61,818,182 won for damages due to non-issuance of tax invoice, and 358,842,182 won for damages incurred by non-issuance of tax invoice, and 358,842,182 won for other construction payment creditors against Addddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddd construction (hereinafter).

Therefore, the court below is just in holding that the credit of the above defect repair expenses and other claims was extinguished on the premise that such credit constitutes legitimate grounds for objection, and there is no error in the misapprehension of legal principles as to grounds for objection as to the ground for appeal. The defendant's appeal on this part cannot be accepted.

B. As to the validity of the deposit and repayment made by the Plaintiff

In the case of a renewal agreement on seizure, since a creditor who collects a claim upon receiving a collection order is a kind of collection agency according to the authorization of the court of execution and performs the collection from a third debtor for all creditors participating in the seizure or distribution, the third debtor, even if the third debtor, makes the repayment to the legitimate collection authority, its effect shall affect all creditors in the relation of seizure (see, e.g., Supreme Court Decisions 86Meu988, Sept. 9, 1986; 200Da43819, Mar. 27, 2001; 200Da43819, Mar. 27, 2001). In addition, if the third debtor makes a deposit for execution or terminates the seizure claim due to set-off or other reasons, its effect shall also affect all creditors in the relation of seizure (see Supreme Court Decision 2001Da10748, May

On the other hand, a third party obligor's deposit under Article 581 (1) of the former Civil Procedure Act requires the concurrence of seizure of claims subject to seizure. In this case, the amount to be deposited by the third party obligor pursuant to the above legal provisions shall be the total amount of obligations (see Supreme Court Decision 2002Da22700, Jul. 22, 2004). However, even if the effect of the execution deposit is not recognized because the third party obligor's deposit is not deposited in full, if the distribution procedure is completed after the deposit is accepted with respect to the deposited amount, the payment of the deposited amount shall be effective.

With respect to this case, there is no effect as a deposit for enforcement for the plaintiff's deposited on December 8, 1998 as principal and interest on the defendant's collection deposit, and for the 3,205,000 won deposited on November 25, 200, but upon the completion of the distribution of dividends, the repayment has the effect of the payment. Furthermore, the principal and interest on the collection deposit of 5,84,000 won deposited on September 26, 200 and the total of 95,097,00 won repaid to him on September 9, 2002 shall be deemed to have the effect of full repayment. Further, all of the above grounds shall be a legitimate ground for a claim due to the reasons arising from the defendant's final argument after the final argument of the judgment rendered by the defendant, which is the subject judgment of the claim of this case.

It is reasonable for the court below to recognize the validity of repayment with respect to the total amount of deposit and repayment, and there is no error in the misapprehension of legal principles as to the validity of repayment as required by the grounds for appeal and the grounds for objection. The defendant's appeal on this part cannot be

Furthermore, as long as the repayment of the amount deposited or repaid by the Plaintiff is recognized as effective, it cannot be said that the Defendant’s failure to receive the payment at all, thereby undermining the Defendant, who is the obligee, or that it cannot be set up against the Defendant. This part of the appeal by the Defendant cannot be accepted.

2. Plaintiff’s ground of appeal

According to the reasoning of the judgment below, as seen earlier, the court below recognized 97,024,00 won as defect repair claims to be deducted from the plaintiff's obligation for the payment of construction costs, and did not recognize as to 50,809,752 won, the plaintiff alleged that the additional deduction should be made with a decrease in the estimate, and there is no violation of the rules of evidence as required in the process of fact-finding or determination. The plaintiff's appeal cannot be accepted.

3. Conclusion

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

Justices Lee Hong-hoon (Presiding Justice)