In cases where an owner of a building site sells a building site to a construction business operator, and a construction business operator newly constructs a house with a building permit granted under the name of the owner of the building site and pays part of the purchase price, but the owner of the building site has agreed to obtain registration of preservation of ownership in the name of the owner of the building site to secure the payment thereof, whether the owner of the building site may seek a name of the house against the person who purchased the building from the construction business operator on the ground of the exercise of the security right (negative),

Where an owner of a building site sells a building site to a building site owner, and a construction business operator has agreed to newly construct a house and pay part of the purchase price to ensure the payment thereof, and where an agreement is made between the owner of the building site and the building business operator to sell the house, which is a security at the time of the said agreement, and to pay part of the purchase price, to the owner of the building site, the ownership of the house, which is a security at the time of the said agreement, is formed together with an agreement between the owner of the building site and the building business operator. Therefore, the situation where the ownership of the house, which is a security, is restored to the owner of the building site last, is not anticipated in principle. Rather, the special agreement on the method of the execution of the security right is concluded between the owner of the building site and the owner of the building site, unless special circumstances exist to the owner of the building site who purchased the house, and as long as the ownership of the house can not be seen as having been carried out by the owner of the building site, it cannot be seen that the owner of the building site had already been sold the building site.

Articles 105, 372 [Security for Transfer and Provisional Registration] and 568 of the Civil Act

[Plaintiff-Appellant] Plaintiff 1 and 1 other (Law Firm Gyeong, Attorneys Park Jong-soo et al., Counsel for plaintiff-appellant)

Plaintiff (Counterclaim Defendant) (Attorney Kim Jong-young, Counsel for the plaintiff-appellant)

Defendant-Counterclaim (Attorney Park Dong-hee et al., Counsel for defendant-Counterclaim)

Seoul High Court Decision 97Na42795, 42801 delivered on February 11, 1998

The judgment below is reversed and the case is remanded to Seoul High Court.

The grounds of appeal are examined.

1. According to the reasoning of the lower judgment, the lower court: (a) concluded a contract on March 15, 1993 between the non-party 1 and the non-party 1, who owned the Plaintiff, with the amount of KRW 490,00,00; (b) the non-party 1 constructed the multi-household 9 households on the instant land with the Plaintiff’s name and sold it to the non-party 1; (c) the non-party 1 purchased it to the other; and (d) paid the above sales amount as part of the purchase price to the Plaintiff to secure the payment; (d) the non-party 1 removed the existing house on the instant land and obtained the construction permit under the Plaintiff’s name; and (e) the non-party 1 newly constructed the instant multi-household 0 with its own expense and effort to purchase it to the non-party 200,000 won on the instant land; and (e) the non-party 2, the non-party 1 and the non-party 2 were to pay the remainder 1090.

Based on such factual basis, the lower court determined that: (a) Nonparty 1, a constructor, acquired the ownership of the instant multi-household house by constructing the instant multi-household house; and (b) thereafter, the registration of ownership preservation was completed in the Plaintiff’s name with respect to each household of the instant multi-household house; and (c) the Plaintiff acquired the security right to transfer to secure the claim for the purchase price of the instant multi-household house; (d) as part of the realization procedure to exercise the right to dispose of the instant multi-household house of this case, which is the secured real estate, the Plaintiff may seek for the delivery against the Defendant, who was transferred possession of the instant real estate from Nonparty 1, the debtor,

Furthermore, the lower court rejected all of the grounds that the Defendant’s assertion seeking to dismiss the Plaintiff’s principal claim on the ground of a sales contract concluded between the Defendant and Nonparty 1 and the Defendant’s counterclaim seeking the implementation of the procedure for registration of ownership transfer with respect to the instant counterclaim, including the site ownership, on the grounds of the above sale and purchase, there is no evidence to acknowledge that Nonparty 1 was delegated the Plaintiff’s comprehensive right to sell the instant multi-household house from the Plaintiff, and the sales contract between the Defendant and Nonparty 1 cannot be denied the Plaintiff’s principal claim on the ground that the sales contract between the Defendant and Nonparty 1 is not different even if the Plaintiff completed registration of ownership transfer with respect to the instant multi-household house, knowing that the instant multi-household house was sold to others.

2. However, in this case, if the sale contract of this case between the plaintiff and the non-party 1 and the payment method thereof are as determined by the court below, "the non-party 1, a creditor of the purchase price, shall construct the multi-household house of this case, which is a security, and sell it to others, and pay to the plaintiff as part of the purchase price" at the time of the contract, "the non-party 1, a creditor of the purchase price, together with the agreement that "the non-party 1 shall construct the multi-household house of this case, which is a security, and pay to the plaintiff as part of the purchase price." It is not expected in principle that the situation where the ownership of the multi-household house of this case, which is a security, is recovered from the plaintiff last, and instead, the "special agreement on the method of executing the security interest" is concluded between the two parties. (See Supreme Court Decision 92Da21395 delivered on December 8, 192). Accordingly, according to the records, the plaintiff had already completed the registration of ownership transfer on the remaining eight households in its name.

Therefore, the Defendant, regardless of the Plaintiff, did not purchase 1 of the instant multi-household housing, but purchased 1 of the land on which Nonparty 1 acquired and sold the right of disposal pursuant to the special agreement on the execution method of the security interest, which was concluded between the Plaintiff and Nonparty 1, and acquired possession pursuant to the terms and conditions of the contract. It is reasonable to deem that, in substance, the security right held by the Plaintiff with respect to 1 of the land among the multi-household housing in this case has already been executed. Thus, even if the registration of preservation of ownership of 1 of the land on 1 of the land was completed after the conclusion of the sales contract between Nonparty 1 and the Defendant, the Plaintiff cannot seek delivery of 1 of the land on the ground that it could not re-exercise the already-run security right, barring any special circumstance, and even if the Defendant was not actually appropriated for the Plaintiff’s claim, it should be settled only between the Plaintiff and Nonparty 1.

In addition, as long as Nonparty 1 sold a multi-household 1 among multi-household housing in this case to the defendant according to the above special agreement with the plaintiff, such sales is deemed to be based on the plaintiff's intent. Thus, the plaintiff cannot deny the status of the purchaser who purchased it as the defendant who purchased it in the same manner as he/she directly disposes of it, and barring any special circumstance, he/she has a duty to implement the procedure for registration of ownership transfer to the defendant

3. Nevertheless, the court below accepted the plaintiff's main claim and rejected the defendant's counterclaim in different opinions, which affected the misapprehension of the legal principles as to non-exclusive security in the form of transfer of ownership and the exercise of security right, and it is clear that such illegality has influenced the conclusion of the judgment. Therefore, the ground of appeal pointing this out has merit.

4. Therefore, the judgment of the court below is reversed, and the case is remanded to the court below for a new trial and determination. It is so decided as per Disposition with the assent of all Justices who reviewed the case.

Justices Cho Cho-Un (Presiding Justice)