[1] The meaning of and criteria for determining "false or exaggerated advertisement" under Article 3 (1) 1 of the former Act on Fair Labeling and Advertising

[2] The case holding that the court below erred in the misapprehension of legal principles in holding that, in case where the buyer Gap filed a claim for damages for delay due to delay of occupancy against the Eul corporation, which newly constructed and sold the apartment unit, since the period of occupancy was only after the expiration of the preparatory period for occupancy, it shall be deemed that the payment was made only after the expiration of the preparatory period for occupancy, and that there was liability for damages due to delay of occupancy

[1] "False or exaggerated advertisement" under Article 3 (1) 1 of the former Act on Fair Labeling and Advertising (amended by Act No. 11050, Sep. 15, 2011) refers to an advertisement that is contrary to facts or is likely to deceive or mislead consumers, and thus, is likely to undermine fair trade order. Whether an advertisement is likely to deceive or mislead consumers should be objectively determined on the basis of the overall and extreme increase that general consumers with common care receive the advertisement.

[2] The case holding that the court below erred in the misapprehension of legal principles as to the method and effect of providing compensation for delay since it did not make any agreement with the purchaser prior to the scheduled date of occupancy in the sale contract on the procedure such as giving the purchaser a prior payment for the time required for the preparation of occupancy or notification of the occupancy period to the purchaser prior to the scheduled date of occupancy in the sale contract, in case where the purchaser Gap filed a claim against the company Eul which newly built and built the apartment unit and sold the apartment unit, for the payment of the remaining amount within the occupancy period, and the company Eul filed for the payment of compensation for delay damages due to delay in occupancy pursuant to the provisions of the sale contract stating that "if the company Eul is unable to move into the scheduled date of occupancy, the purchase price shall be paid within the occupancy period, and the purchase price shall be deducted from the remaining amount, and it shall be paid to the purchaser prior to the scheduled date of occupancy, and it shall be deemed that the purchaser would be able to pay the remainder within the occupancy period and make preparation for the occupancy.

[1] Article 3(1)1 of the former Act on Fair Labeling and Advertising (Amended by Act No. 11050, Sep. 15, 201) / [2] Articles 460 and 461 of the Civil Act

[1] Supreme Court Decision 2002Du6965 Decided June 27, 2003 (Gong2003Ha, 163) Supreme Court Decision 2009Da67979, 67986 Decided August 26, 2010

Plaintiff

Newan Construction Industry Co., Ltd.

Seoul Western District Court Decision 2012Na7483 decided February 8, 2013

The part of the judgment of the court below against the defendant on the claim for damages for delay due to delay in occupancy is reversed, and that part of the case is remanded to the Seoul Western District Court Panel Division. The remaining appeal is dismissed.

The grounds of appeal are examined.

1. Regarding ground of appeal No. 1

"False or exaggerated advertisements" under Article 3 (1) 1 of the former Act on Fair Labeling and Advertising (amended by Act No. 11050, Sep. 15, 201; hereinafter referred to as the "Indication Advertising Act") means advertisements that are different from facts or excessively exaggerated and thus are likely to deceive or mislead consumers, and thus are likely to undermine fair trade order. Whether an advertisement is likely to deceive or mislead consumers should be objectively determined on the basis of the total and extreme increase that ordinary consumers receive the advertisement (see, e.g., Supreme Court Decisions 2002Du6965, Jun. 27, 2003; 2009Da67979, 679886, Aug. 26, 2010).

The lower court determined as follows: (a) the Defendant’s mere expression of the place where the Army○○○ unit was located in the instant apartment sales advertisement was placed in the Army as a neighboring park, which is an advertisement that is different from the fact on the existence of a military unit and a neighboring park; or (b) made an advertisement that is likely to mislead the Plaintiff, a consumer, to mislead him/her of the fact; and (c) thereby, constitutes a false or exaggerated advertisement that is likely to disrupt fair trade order.

In light of the above legal principles and records, the judgment of the court below is just and acceptable. Contrary to the allegations in the grounds of appeal, there were no errors in the misapprehension of legal principles as to false or exaggerated advertisements under the Act on the Protection of Military Installations, or by misapprehending the legal principles as to

2. Regarding ground of appeal No. 2

The main text of Article 11(1) of the Act on Labeling and Advertising provides that “The right to claim compensation for damages under Article 10 shall not be asserted in trial unless corrective measures under Article 7 have become final and conclusive,” but such restrictions are added only to “the case where corrective measures under Article 7 have been taken” as clearly stated in the same Article (see Supreme Court Decision 2008Da19355, Aug. 20, 2009).

According to the records, it can be known that the defendant was not subject to corrective measures under Article 7 of the Act on the Labeling and Advertising in connection with the sale advertisement of the apartment of this case. Thus, the plaintiff's assertion of the right to claim damages under Article 10 of the same Act is not restricted by the main sentence of Article 11 (1) of the same Act

On the same premise, the court below is just in holding the plaintiff's claim for damages, and there is no error in the misapprehension of legal principles as to the limitation of claim for damages under the Act on Advertisement and Advertisement.

3. As to the third ground for appeal

The court may determine the amount of damages by taking into account all relevant indirect facts, such as the relationship between the parties revealed by the result of examination of evidence and the purport of the entire pleading, the background leading up to the occurrence of property damage, the nature of damage, and various circumstances after the occurrence of damage, where it is difficult to prove the specific amount of damage in a claim for damages due to a tort, even though property damage is acknowledged as having occurred (see, e.g., Supreme Court Decision 2002Da6951, 6968, Jun. 24, 2004). Meanwhile, it is not permissible for a person who intentionally committed a tort by taking advantage of the victim’s care to claim the reduction of his/her liability on the ground of the victim’s negligence (see, e.g., Supreme Court Decision 95Da30352, Nov. 14, 1995).

The court below held that the damages incurred to the plaintiff who was the buyer due to the defendant's false or exaggerated advertising is the difference between the market price of the apartment in the event that there is a neighboring park in the vicinity of the apartment of this case and the market price of the apartment in the condition that no park facilities are installed. Since it is considerably difficult to prove the specific amount of damages, the court below held that the plaintiff's damages should be 3% of the purchase price of the apartment of this case in consideration of all the circumstances in the pleading. The court below rejected the defendant's assertion of comparative negligence on the ground that the defendant's act of violating the Act on Advertisement and Advertisement due to the defendant's false or exaggerated advertising constitutes intentional tort by using consumer care.

In light of the above legal principles and records, the judgment of the court below is just and acceptable. Contrary to the allegations in the grounds of appeal, there were no errors in the misapprehension of legal principles as to the determination of damages caused by false or exaggerated advertisements and comparative negligence offsetting.

4. As to the fourth ground for appeal

The performance of an obligation shall be in accordance with the substance of the obligation, but if it is required for an obligee to perform the obligation, the completion of the preparation for performance shall be notified and the receipt thereof shall be notified, and if an obligor who is at the time of the delay of performance or provides legitimate performance, he/she shall be exempted from liability for the delay of performance from that time (Article 460, Article 461 of the Civil Act).

According to the reasoning of the judgment below and the evidence duly admitted by the court below, the sales contract of this case between the plaintiff and the defendant stipulated that "the scheduled date of occupancy is in December 2008, any balance shall be paid within the occupancy period, and if the defendant is unable to move into the scheduled date of occupancy, compensation for delay shall be paid to the plaintiff or deducted from the remaining price in accordance with the fixed overdue rate." However, there is no provision regarding the procedure for the preparation of occupancy or the time of notification of the occupancy period. As the construction of the apartment of this case delayed, the defendant changed the scheduled date of occupancy into February 2009 with the plaintiff's consent, and the sales contract of this case between the plaintiff and the defendant was defective on April 17, 2009, and the defendant notified the buyer including the plaintiff that he will move into the apartment of this case by determining the occupancy period as "from April 18, 2009 to June 16 of the same year."

In light of the above facts, as long as the defendant constructed the apartment of this case and completed the preparation to move into the apartment of this case by April 17, 2009, and then notified the plaintiff to the buyers including the plaintiff as "from April 18, 2009 to June 16 of the same year", it shall be deemed that the defendant provided legitimate performance by setting the occupancy period to the buyers including the plaintiff. The contract of this case did not make any agreement on the procedure of granting the time necessary for the preparation for moving into the apartment of this case prior to the scheduled date of moving into the apartment of this case or notifying the time of moving into the purchase for this purpose. The contract of this case did not allow the buyer to pay the remainder within the scheduled date of moving into the apartment of this case, so that the buyer can pay the balance of the delay damages without the burden of paying the delay damages to the buyer and the period of preparing for moving into the apartment of this case has been set from the time of notification to the time of moving into the apartment of this case. Therefore, the compensation for moving into the apartment of this case shall be paid from March 19, 20009 to 4.

Nevertheless, the court below held otherwise on the premise that the period of preparation required for the occupancy procedure scheduled in the apartment sale contract of this case is about 15 days from the date the defendant sent the notice of designation of occupancy to the extent of 15 days from the date when the defendant sent the notice of designation of occupancy, and held that the date the apartment of this case was offered to the 15 days from April 17, 2009 to May 3 of the same year after the expiration of 15 days from April 17, 2009 when the notice of designation of occupancy was issued. Thus, the defendant is liable for compensation for damages due to the delay of occupancy from April 18, 2009 when the occupancy period commenced to May 2, 20 of the same year as the date the occupancy period actually

5. Conclusion

Therefore, the part of the judgment of the court below against the defendant as to the claim for damages for delay due to the delay in occupancy is reversed, and that part of the case is remanded to the court below for further proceedings consistent with this Opinion. The remaining grounds of appeal are dismissed without merit. It is so decided as per Disposition by the assent

Justices Kim Yong-deok (Presiding Justice)