Plaintiff Private Institutes (Law Firm Shin & Yang, Attorneys Park Jong-soo et al., Counsel for the plaintiff-appellant)

Defendant (Attorney Choi Jin-jin, Counsel for defendant-appellant)

December 16, 2008

1. On June 4, 2008, the Defendant shall implement the procedure for registration of cancellation of each transfer of ownership on the ground of sale by compulsory auction on June 4, 2008, registered as the receipt No. 38016 on June 27, 2008 with respect to each real estate listed in the separate sheet to the Plaintiff.

2. The costs of lawsuit shall be borne by the defendant.

The same shall apply to the order.

1. Basic facts

A. The Plaintiff is an educational foundation that establishes and operates a “○ school” introduced to the ○○○○○, a livingly South-North Korean voice group, and each real estate listed in the separate sheet (hereinafter “each real estate of this case”) constitutes a profit-making site among the Plaintiff’s fundamental property.

B. On October 27, 2003, Suwon District Court 2003, Sungnam Branch 2003, 18168 regarding each real estate of this case, the compulsory auction procedure was initiated. The above auction court made a ruling of refusal of sale twice on the grounds that the disposal of each real estate of this case, which is the fundamental property, was not permitted by the competent agency. On February 29, 2008, the Minister of Education, Science and Technology decided to grant the permission for sale to the defendant who is the highest bidder on April 28, 2008 without any separate permission for disposal of the defective disposition of the basic property.

C. On June 4, 2008, the Defendant paid the successful bid price of 861 million won in full, and received the registration of transfer of ownership due to a compulsory auction on June 4, 2008 by the Sungwon-nam Branch Office of Sungwon-nam District Court No. 38016, Jun. 27, 2008.

2. Determination

Where a school foundation sells its basic property, it shall obtain permission from the competent authorities (Article 28(1) of the Private School Act); where a school foundation sells its basic property, its residual property shall revert to a person designated by its articles of incorporation at the time of report on the completion of liquidation except in the case of merger and bankruptcy (Article 35(1) of the same Act), and the school foundation shall not immediately lose its right by dissolution, but continue to exist within the scope of the purpose of liquidation as a liquidated corporation; and during that period, its property shall belong to the liquidated corporation. Thus, even if a school foundation enters into liquidation procedures by dissolution, it shall obtain permission from the competent authorities pursuant to Article 28(1) of the Private School Act in order to acquire its basic property in real estate auction procedures (see Supreme Court Order 2003Ma1669, Dec. 17, 2003). Although a school foundation is dissolved by a dissolution order of the Minister of Education, Science and Technology (Article 47 of the Private School Act).

Therefore, even if the basic property of a school juristic person was knocked by the compulsory auction procedure without permission of the supervisory authority, and the registration of transfer of ownership in the name of successful bidder was made on the ground of auction, such registration is a registration lacking a legitimate cause (see Supreme Court Decision 93Da42993 delivered on January 25, 1994). Thus, the defendant is obligated to implement to the plaintiff the procedure for cancellation of transfer registration of ownership as of June 27, 2008, which was completed with respect to each real property of this case.

3. Conclusion

Therefore, the plaintiff's claim of this case is reasonable, and it is so decided as per Disposition.

【Omission of Real Estate List】

Judges Kim Young-young (Presiding Judge)