Whether the obligation to return the amount of membership fees to members recruited pursuant to Article 17 of the Installation and Utilization of Sports Facilities Act, which a person who acquired essential facilities according to the standards for facilities of a sports facility business through an auction, etc. under the Civil Execution Act, is included in the liability property provided for common creditors' joint security (negative), and whether the transfer of the relevant object constitutes a fraudulent act where the amount deducted within the scope of the liability property exceeds the price of the object (negative)

Article 27(1) of the Installation and Utilization of Sports Facilities Act (hereinafter “sports facilities Act”) provides that “When a sports facility business entity dies or transfers his/her business, or when a corporate sports facility business entity merges with another sports facility business entity, the heir, the transferee of the business, the corporation surviving the merger, or the corporation established by the merger shall succeed to the rights and obligations arising from the registration or report of the relevant sports facility business (including the matters agreed upon between the sports facility business entity and its members where members are recruited pursuant to Article 17).” Article 27(2) provides that “The provisions of paragraph (1) shall apply mutatis mutandis to a person who acquires essential facilities according to the standards for the facilities of the sports facility business prescribed by Ordinance of the Ministry of Culture, Sports and Tourism according to any of the following procedures.” Accordingly, Article 17 of the Sports Facilities Act provides that “an auction under the Civil Execution Act shall be an object subject to an auction under the Civil Execution Act.” Therefore, the portion of the amount refunded to a member pursuant to the Civil Execution Act shall not be included in the amount equivalent to the amount provided as a general security.

Article 406 of the Civil Act, Articles 17 and 27(1) and (2) of the Installation and Utilization of Sports Facilities Act

Supreme Court Decision 97Da10864 Decided September 9, 1997 (Gong1997Ha, 3051) Supreme Court Decision 2007Da24954 Decided July 12, 2007

Korea Credit Guarantee Fund (Law Firm Jin Law, Attorneys Sung- Chang et al., Counsel for the defendant-appellant)

Coin Assets Trust Co., Ltd. (Law Firm Spacco Assets Trust et al., Counsel for the plaintiff-appellant)

Seoul High Court Decision 2011Na64418 decided February 22, 2012

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

The grounds of appeal are examined (to the extent of supplement in case of supplemental appellate briefs not timely filed).

In a case where a juristic act on a certain real estate constitutes a fraudulent act, in principle, the revocation of the fraudulent act and the cancellation of the registration of transfer of ownership shall be ordered: Provided, That in a case where it is impossible or considerably difficult to return originals, it is necessary to order compensation equivalent to the value of the object of the fraudulent act as a performance of the duty to restore if it is impossible or considerably difficult to do so, and in a case of such compensation, it is necessary to order compensation within the scope of the establishment of the fraudulent act as joint security of the general creditors (see Supreme Court Decision 2003Da40286, Dec. 12,

Meanwhile, Article 27(1) of the Installation and Utilization of Sports Facilities Act (hereinafter “sports facilities Act”) provides that “When a sports facility business entity dies or transfers his/her business, or when a corporate sports facility business entity merges with another sports facility business entity, the heir, the transferee of the business, the corporation surviving the merger, or the corporation incorporated by the merger shall succeed to the rights and duties (including the matters agreed upon between the sports facility business entity and its members where members are recruited pursuant to Article 17) following the registration or report of the relevant sports facility business; and Article 27(2) of the same Act provides that “The provisions of paragraph (1) shall apply mutatis mutandis to a person who acquires the essential facilities in accordance with the facility standards for the sports facility business prescribed by Ordinance of the Ministry of Culture, Sports and Tourism according to any of the following procedures.”

Therefore, the portion of the amount of the obligation to return the membership fees to the members recruited in accordance with Article 17 of the Sports Facilities Act that the person who acquired essential facilities according to the facility standards of the sports facility business through an auction under the Civil Execution Act shall be succeeded to through an auction under the Civil Execution Act shall not be included in the property held by the general creditors as a joint collateral in light of the fact that the sale price is determined in light of the amount of the repayment obligation in the auction procedure under the Civil Execution Act.

In addition, if the amount deducted within the scope of a responsible property exceeds the price of the object, the transfer of the object concerned shall not be deemed a fraudulent act (see, e.g., Supreme Court Decisions 97Da10864, Sept. 9, 197; 2007Da24954, Jul. 12, 2007).

According to the reasoning of the judgment below, the court below found on February 12, 2009 that, based on the evidence of employment, the debtor corporation Amateur Sports Center (hereinafter "the debtor of this case") reported most of the real estate in attached Table 1 (hereinafter "real estate 1") as sports facilities (a swimming pool, golf driving range, physical training course, indoor skiing ground, etc.") under the attached Table 1 of the judgment of the court below, and operated the "Amateur Sports Center" as a member sports center. The debtor of this case entered into a real estate security trust contract with the defendant on February 12, 2009 and completed the registration of transfer of ownership based on the above trust contract to the defendant on February 13, 2009. At the time, the debtor's property of this case has real estate 3.4.5 billion won as active property, and the debtor's property of this case has been 2.3 billion won as collateral security obligation established in the real estate 1 as property and auction procedure pursuant to the Civil Execution Act.

Examining the facts established by the court below in light of the legal principles as seen earlier, part of the amount of the secured debt of the right to collateral security established on the real estate 1 and the amount of the membership fee prescribed by the Sports Facilities Act and subordinate statutes, which is KRW 33.27 billion, which is the amount of the obligation to return the membership deposit that the purchaser, etc. succeeds to the auction procedure, shall be deducted within the scope of the debtor's property of this case. Since the sum of the amount deducted within the scope of the responsible property exceeds KRW 34.5 billion, which is the value of the real estate 1, it shall not be deemed that the debtor entrusted the real estate 1 to

Nevertheless, the court below held that the trust contract of this case was a fraudulent act on the ground that members of the Sports Center did not have the right to preferential payment for the claims for the return of deposit money. The court below erred by misapprehending the legal principles as to the scope of the liability property in a lawsuit seeking revocation of a fraudulent act, which affected the conclusion of the judgment. The ground of appeal assigning this error is with merit.

Therefore, without further proceeding to decide on the remaining grounds of appeal, 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.

Justices Yang Chang-soo (Presiding Justice)