[1] In a case where a lessee who can oppose the transferee of a leased house does not want the succession of the lease relationship by himself/herself, whether the lease contract can be terminated by mutual consent with the lessor before the expiration of the lease term, and whether the transferee of the leased house succeeds to the status of the lessor (negative)

[2] In a case where a pledgee notified a third party obligor of the fact of the pledge or consented to the third party obligor’s repayment without the pledgee’s consent, whether the third party obligor may oppose the pledgee (negative), and whether the same applies to a case where the third party obligor, without the pledgee’s consent, has extinguished the obligation subject to the pledge by making a set-off agreement with the pledgee (affirmative)

[1] In cases where a lessee with opposing power under Article 3(1) of the former Housing Lease Protection Act (amended by Act No. 12043, Aug. 13, 2013; hereinafter the same) exists, the transferee of the leased house is deemed to have succeeded to the status of the lessor pursuant to Article 3(3) of the same Act. As a result, the transferee of the leased house is exempted from the obligation to return the lease deposit, and the transferor is exempted from the obligation to return the lease deposit to the lessee by withdrawing from the lease relationship. However, even if the lessee is entitled to oppose the transferee of the leased house, the transferee of the leased house may be exempted from the restraint of the succeeded lease relationship if he/she does not want the succession of the lease relationship. In such cases, the transferee of the leased house is not able to succeed to the status of the lessor.

[2] Where a pledge has been established on a claim against a third party obligor as a security for an obligation to another person, the pledger cannot extinguish the right under the pledge without the pledgee’s consent or make any change detrimental to the pledgee’s interest (Article 352 of the Civil Act). This is intended to protect exclusive control power that the pledgee has with respect to the exchange value of the claim subject to the pledge. Therefore, where the pledger notifies the third party obligor of the fact of the pledge or consented to it, it cannot be set up against the third party obligor even if the third party obligor performs the obligation subject to the pledge without the pledgee’s consent, and the pledgee still may demand the third party obligor to pay the direct obligation pursuant to Article 353(2) of the Civil Act. The third party obligor cannot set up a defense against the pledgee even if the third party obligor terminates the obligation subject to the pledge by setting-off agreement with the pledgee without the pledgee’s consent, and the pledgee still may demand the third party obligor to pay the direct obligation.

[1] Article 3(1) and (3) (see current Article 3(4)) of the former Housing Lease Protection Act (Amended by Act No. 12043, Aug. 13, 2013) / [2] Articles 352 and 353(2) of the Civil Act

[1] Supreme Court Decision 94Da37646 Decided July 12, 1996 (Gong1996Ha, 2458) / [2] Supreme Court Decision 97Da35375 Decided November 11, 1997 (Gong1997Ha, 370), Supreme Court Decision 2015Do5665 Decided April 29, 2016 (Gong2016Sang, 718)

Reference Non-Life Insurance Co., Ltd. (Law Firm Maw, Attorneys Han Jae-hwan et al., Counsel for the plaintiff-appellant)

Defendant (Law Firm Inhan River, Attorneys Lee Sang-hoon et al., Counsel for the defendant-appellant)

Seoul Central District Court Decision 2016Na40124 decided October 28, 2016

The judgment below is reversed, and the case is remanded to the Seoul Central District Court.

The grounds of appeal are examined.

1. In cases where a lessee who has opposing power pursuant to Article 3(1) of the former Housing Lease Protection Act (amended by Act No. 12043, Aug. 13, 2013; hereinafter the same) exists, the transferee of the leased house shall be deemed to have succeeded to the status of the lessor pursuant to Article 3(3) of the same Act. As a result, the transferee of the leased house shall be exempted from the obligation to return the lease deposit, and the transferor shall withdraw from the lease relationship and be exempted from the obligation to return the lease deposit to the lessee. However, even if the lessee who can oppose the transferee of the leased house does not want the succession of the lease relationship, it shall be deemed that the succeeded lease relationship may be exempted (see, e.g., Supreme Court Decision 94Da37646, Jul. 12, 1996); and in such cases, the transferee of the leased house may terminate the lease contract by agreement with the lessor before the lease term expires and receive the deposit from the lessor.

Meanwhile, in cases where a pledge right is established on a claim against a third party obligor as a security for an obligation to another person, the pledger cannot extinguish the right under the pledge without the consent of the pledgee, or may not change to the extent that it would prejudice the rights of the pledgee (Article 352 of the Civil Act). This is to protect exclusive control over the right of the pledgee over the exchange value of the claim subject to the pledge (see, e.g., Supreme Court Decision 97Da35375, Nov. 1, 1997). Therefore, if the pledger notifies the third party obligor of the fact of the pledge right or the third party obligor consents thereto, even if the third party obligor reimburses the obligation subject to the pledge without the consent of the pledgee, the pledgee may still claim directly against the third party obligor for the repayment of the obligation pursuant to Article 353(2) of the Civil Act (see Supreme Court Decision 2015Do565, Apr. 29, 2016). 3).

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

1) On March 6, 2012, the Nonparty leased from the Defendant ( Address omitted) apartment ○○○○○dong (hereinafter “instant apartment”) KRW 110,00,000 as lease deposit, and completed the move-in report around that time.

2) On March 13, 2012, the Nonparty took out a loan of KRW 82,00,000 from the Plaintiff, and established a pledge against KRW 98,40,000, out of the claim for the refund of the lease deposit of the instant apartment, to the Plaintiff. On April 6, 2012, the Defendant agreed to accept the said pledge against the Plaintiff on April 6, 2012, and return the lease deposit due to the expiration of the lease term, the Nonparty directly returned the lease deposit equivalent to the said principal and interest of the loan to the Plaintiff within the established amount of the pledge.

3) On June 30, 2012, the Defendant concluded a sales contract to sell the instant apartment to the Nonparty for KRW 155,000,000,000. Of the purchase price of KRW 155,000,000, the remainder 110,000,000, excluding the amount of debt borrowed from the Nonparty as security of the instant apartment and the amount of the instant apartment, etc., was paid. After the settlement was completed pursuant to the said sales contract, the Defendant completed the registration procedure for transfer of ownership of the instant apartment against the Nonparty on July 2, 2012.

B. Examining the above facts in light of the legal principles as seen earlier, the Nonparty, a lessee with opposing power, agreed to terminate the lease agreement at the same time with the Defendant, a lessor, and set off the claim for the refund of the purchase price and the claim for the refund of the deposit. Therefore, the Nonparty does not succeed to the status of a lessor. Furthermore, since the Defendant consented to the establishment of a pledge as a garnishee, it cannot be set up against the Plaintiff even if the Defendant extinguished the obligation for the refund of the lease deposit for the instant apartment, which is the object of the pledge, by concluding a set-off agreement with the Nonparty, a pledgee without the Plaintiff’s consent, and the Plaintiff still can claim the return of

3. Nevertheless, the court below held otherwise on the premise that the non-party succeeded to the status of the lessor by acquiring the ownership of the apartment of this case from the defendant, and based on the premise that the ownership and the right of lease on the real estate belong to the same person, in principle, the right of lease shall be extinguished due to confusion. However, if the right of lease belongs to the same person, if the right of lease satisfies the requirements for counterclaim, the non-party's claim for return of the deposit of lease or the alteration of the plaintiff's interest is extinguished due to the sale of the apartment of this case due to the application of the proviso of Article 191 (1) of the Civil Act, which is an exception to the principle of extinguishment of the real right due to confusion. In so determining, the court below erred by misapprehending the legal principles

4. Therefore, 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 Park Sang-ok (Presiding Justice)