208Guhap533 The revocation of revocation of the imposition of development charges

1. P1 (29 Years and Females);

2. P2 (Year 71 and Female)

3. P3 (75 Yearss, Residuals)

4. P4 (73years, Residuals)

[Judgment of the court below]

The head of Gangseo-gu Busan Metropolitan Government

November 6, 2008

December 11, 2008

1. All of the plaintiffs' claims are dismissed. 2. Costs of lawsuit are assessed against the plaintiffs.

The Defendant’s imposition of development charges of KRW 33,108,680 against the Plaintiffs on June 20, 2007 is revoked.

1. Details of the disposition;

A. On October 12, 2006, the Plaintiffs: (a) donated land of 1,074m2 (hereinafter “instant land”) located within a development-restricted zone, Busan Gangseo-gu, 1,000-5m2 (hereinafter “the instant land”); and (b) completed the registration of ownership transfer on October 17, 2006, to the Plaintiffs.

B. On August 10, 2006, Plaintiff P1 purchased the so-called right to file an application for a building permit on the instant land located within the development restriction zone, which is the right to own real estate located within the Busan Gangseo-dong, Busan, which is located within the development restriction zone. On November 2, 2006, Plaintiff P1 obtained a building permit from the Defendant as the owner of B from the Defendant as the owner of the building on December 8, 2006, to newly build two repair stores, which are Class II neighborhood living facilities (hereinafter “the instant project”). On April 3, 2007, Plaintiff P1 changed the name of the owner of the said building permit from the Plaintiff as the owner of the building on December 28, 2006, and newly constructed two repair stores and obtained approval for use from the Defendant on March 21, 2007, and changed the land category from the land category on the public record of this case on April 3, 2007.

C. On June 20, 2007, the Defendant determined that the instant project falls under the subject of development charges, and deemed the starting point of the imposition as March 21, 2007, and deemed the starting point as December 8, 2006, and determined as the reference land value of KRW 440,402,292 (the value of the instant land at the time of the completion of the imposition as reference land 1,000-24 at the time of the completion of the imposition, was selected as reference land and calculated by comparison in accordance with Article 9(2) of the Public Notice of Values and Appraisal of Real Estate Act (405,000 won per one square meter) based on the officially announced land value of reference land (405,000 won per 1 square meter), but the amount calculated by adding the normal land value increase from January 1 of the relevant year to the time of the imposition (calculated to KRW 410,058 won per 1 square meter at the time of the imposition) and then deducted the Plaintiffs’ development charges to KRW 3084,3084,3084,39,3840.

[Ground of recognition] Facts without dispute, Gap 1 through 21, 31, and 32 (including paper numbers; hereinafter the same shall apply), the purport of the whole pleadings

2. Whether the disposition is lawful;

A. The plaintiffs' assertion

For the following reasons, the instant disposition is unlawful and thus should be revoked.

(1) Although the land category of the instant land is the answer entered in the public register, it was virtually a siteized since several years ago, the instant project, which is merely a new construction of two repair points on the instant land, is not subject to development charges.

(2) The defendant provided any guidance on the imposition of the development charges before the execution of the project in this case, and only after the completion of the project in this case, on March 26, 2007. If the plaintiffs knew that the development charges should be imposed prior to the implementation of the project in this case, the project in this case should be reviewed again, and the project in this case should be carried out as soon as the defendant did not give any guidance on the imposition of the development charges, and the project in this case should be deemed not subject to the development charges. Thus, the disposition in this case imposing the development charges on the plaintiffs is unjust.

(3) Of the entire area of the land of this case, the area of individual share of the plaintiffs is limited to 268.5 meters, and the land of this case was not divided only into small-scale land actually divided due to fences, etc. Thus, the project of this case is not subject to development charges because its execution area falls short of 660 meters, and even if it is subject to the imposition of household development charges, the permitted area of the project of this case is limited to 989 meters, and the remaining 85 square meters is used as a road before the execution of the project of this case, so it is practically impossible for the plaintiff to exercise his right to this part. Thus, the disposition of this case should be based on the calculation of development charges, and it is unlawful since the development charges was calculated based on the total area of the land of this case.

(4) In calculating development charges, the Defendant calculated the value of the instant land as of the starting point of imposition based on the officially assessed value, but it goes against equity by computing the value of the instant land at the time of completion of imposition through appraisal. The officially assessed individual land price per meter of the instant land at the time of completion of imposition is KRW 406,00, July 1, 2007; KRW 411,000, January 1, 2008; and KRW 410,058, March 21, 2007, which is the time of completion of imposition calculated by the Defendant’s calculation; thus, it goes against Article 9(1) of the Act on the Public Notice of Values and Appraisal of Real Estate, which shall maintain a balance between the relevant land price and the officially assessed value of the relevant land; and the Defendant’s disposition in this case is unlawful as it did not go against the permission of construction on November 2, 206 at the time of completion of imposition as of December 8, 2006.

(5) In order to build a new repair store on the instant land, which is a land category located within a development-restricted zone, a land category, requires a right to removed and reduced land, and since Plaintiff P1 purchased a right to removed and reduced land from B, in calculating development charges, KRW 100 million purchase price for the aforementioned right should be deducted as development costs as other expenses, improvement expenses, or other equivalent expenses, but the Defendant calculated development charges without deducting them, and issued the instant disposition, which is unlawful.

B. Relevant statutes

It is as shown in the attached Form.

C. Determination

(1) Determination as to the allegation in paragraph (1) of the above A-A-be

Article 5 (1) 10 of the former Restitution of Development Gains Act (wholly amended by Act No. 9045, Mar. 28, 2008; hereinafter referred to as the "Act"), Article 4 (1) [Attachment 1] 9 of the Enforcement Decree of the Act (wholly amended by Presidential Decree No. 20722, Feb. 29, 2008; hereinafter referred to as the "Enforcement Decree"), Article 3-2 (2) [Attachment 2] of the former Enforcement Rule of the Restitution of Development Gains Act (amended by Ordinance No. 004, Mar. 14, 2008; hereinafter referred to as the "Enforcement Rule of the Development Gains Act") provides that a project subject to development charges is a project that requires the change of its land category due to the construction of Class 2 neighborhood living facilities or the change of land category due to the construction of Class 1 (a) shall not be deemed to have been carried out due to the change of the land category of the above Act, which is the physical purpose of the construction project.

On the other hand, there is no ground to view that there is a duty to notify the project operator of the imposition of the development charges prior to the execution of the project subject to the imposition of the development charges, and the plaintiff's assertion on this premise is without merit.

(3) Determination as to the assertion stated in paragraph (3) of the above A-Ba

Article 5 (2) of the Act, and Article 4 (1) 1 of the Enforcement Decree of the Act provide that the scale of a development project subject to development charges shall be the case where the area of the land subject to authorization, permission, license, etc. obtained by the State or a local government is at least 660 square meters in the case of a project implemented in an urban area among urban areas in a Metropolitan City. The scale of a development project subject to development charges shall not be the actual development area but the area of the land subject to authorization, etc. under the relevant Acts and subordinate statutes (see, e.g., Supreme Court Decision 98Du2881, Dec. 10, 1999). In this case, it is reasonable to deem that the area of the land subject to the authorization, etc. is the total area of the land subject to authorization, etc., not the area of the land for each co-owner or the area of the land subject to the authorization, etc. (see, e.g., Supreme Court Decision 95Nu

In addition, Article 12(2) of the Enforcement Decree on the computation of development charges provides that development charges shall be deemed to have occurred only for the area, the category of which has been changed after the completion of the pertinent project or public record, among the areas of development projects involving the change of land category. Since construction of a building is a development project involving the change of land category different from that of construction of a building and its appurtenant thereto, development charges do not necessarily require physical development acts. Thus, if development gains have occurred as a whole, it shall be deemed that the entire land area is subject to development charges, regardless of whether it would be due to construction of a building or change of land category (see, e.g., Supreme Court Decision 97Nu6872, Dec. 28, 199). Since the Plaintiff’s land category was changed to 30 square meters, the Plaintiff’s land category was changed to 60 square meters in its entirety and 200 square meters in its land category, and the Plaintiff’s land category was used as a whole within 200 square meters in its public record.

(4) Determination as to the assertion described in paragraph (4) of the above A-Ba

In full view of the purport of the pleading in the statement No. 12 and No. 34, and No. 4, the defendant calculated the value of the land of this case at the time of completion of imposition, as a whole, pursuant to Article 10(1) of the Act, Articles 2 and 12 of the Enforcement Decree of the Act, and Article 4-3(1) of the Enforcement Rule, the defendant shall select land of this case at the time of completion of imposition, which is the most similar to the land of this case at the time of completion of imposition after deliberation by the Gangseo-gu Real Estate Appraisal Commission, as reference land price. The defendant's assertion that the value of the land of this case at the time of completion of imposition under Article 9(2) of the Act on Public Notice and Appraisal of Real Estate as of January 1 of the corresponding year is calculated by adding up the increase in normal land price from March 21, 207 to the point of completion of imposition, and that the value of the land of this case at the time of completion of imposition cannot be seen as 10% of the total officially assessed land price of this case.

In addition, Article 9(1) and (2) of the Act and Article 7(1) [Attachment Table 2] subparagraph 9 of the Enforcement Decree of the Act are the date when the development project, which is the starting point of imposition, is the date when the authorization, etc. of the development project, is obtained in the case of a project which actually carries out construction of a building or requires a change of land category in the public register, and as seen earlier, the date when the construction permission was granted for 2 units of the repair point is November 2, 2006 and December 8, 2006, which is the starting point of imposition, is merely the date when the name of the owner was changed from B to PE. Thus, it is erroneous that the Defendant deemed the starting point of imposition of December 8, 2006 as the starting point of imposition, but according to the Gap evidence No. 12, it can be acknowledged that the average land price of Busan Gangseo-gu was 0.534 on November 206 and 0.480 on December 12, 2006.

(5) Determination as to the assertion stated in paragraph (5) of the above A-Ba

In calculating development charges, Articles 8 subparag. 3 and 11(1) of the Act stipulate other expenses incurred in relation to the implementation of a development project among the development costs to be deducted, as well as improvement expenses of the relevant land. Article 10 of the Enforcement Decree of the Act provides that other expenses are the sum of compensation expenses for development project areas, buildings, standing trees, goodwill, etc. not included in the land value and charges paid to the State and local governments pursuant to the provisions of other Acts and subordinate statutes or the conditions of authorization for development projects, etc., and Article 11(2) of the Act provides that improvement expenses are expenses incurred in improving the land subject to imposition before the commencement of the development project, which are not reflected in the land price as of the starting point. Accordingly, the expenses incurred in purchasing so-called Eas from Plaintiff P1 cannot be deemed to include any other expenses or improvement expenses under the Enforcement Decree of the above Act.

In addition, with respect to the issue of whether the purchase cost of the right to use land should be deducted in the calculation of development charges corresponding to other expenses or improvement expenses, development gains, which form the basis of the calculation of development charges, refer to the benefits derived from the enhancement of value of the land that is obtained through the development project. In such cases, development gains to be deducted in the calculation of development gains refer to the expenses that are incurred in increasing the value of the land subject to the development gains by increasing the convenience of the land itself. However, Article 11 of the former Act on Special Measures for Designation and Management of Development Restriction Zones (wholly amended by Act No. 8975 of March 21, 2008) provides that the above construction cost of the building within the development restriction zone may be removed and reduced in the name of the owner of the building with permission from the competent government office for the purpose of preventing the proliferation of the natural environment surrounding the urban area and preserving the new use environment of the urban area, and thus, it is reasonable to view that the Plaintiff’s first use of the above construction permission under the name of the owner of the building permit can be deemed to be limited to the next owner (see the Plaintiff’s first use permission).

3. Conclusion

Therefore, the plaintiffs' claim of this case is dismissed in entirety as it is without merit, and it is so decided as per Disposition.

The effects of the presiding judge and judges;

Judges Kang Jin-ju

Judges Park Jong-sung