Plaintiff 1 and 111 others (Attorney Park Yong-il, Counsel for the plaintiff-appellant)

Defendant Co., Ltd. (Law Firm Gyeong & Yang, Attorneys Shin Young-soo et al., Counsel for the defendant-appellant)

May 10, 2006

1. The plaintiffs' claims are dismissed.

2. The costs of lawsuit are assessed against the plaintiffs.

It is as stated in the separate sheet of claim.

1. Basic facts

The following facts are either disputed between the parties, or acknowledged by taking into account the whole purport of the pleadings in the descriptions of Gap evidence 1 through 4, Gap evidence 6-3, Gap evidence 7, Gap evidence 8-1 through 4, Eul evidence 10-1 through 3, Eul evidence 5-1 through 5, Eul evidence 6, Eul evidence 9-1 through 11, and Eul evidence 9-3.

A. The Plaintiffs are the buyers of ○○○○○○ Office Officetel (hereinafter “instant officetel”) located in 25 block B5 of the Incheon Jung-gu International Airport International Airport (IBC; International Business Agent; hereinafter “International Business Area”) and the Defendant is the seller of the instant officetel.

B. The plaintiffs received the right to sell each of the instant officetels from the defendant around September 2002 or from the purchaser of the instant officetels from the defendant (the details of each contract by the plaintiffs are as stated in the separate sheet of sale) and the contents of each of the above sales contracts are as follows.

(1) The right to a site is a right of lease, and the defendant, the executor of the Incheon Metropolitan City, leased the land owned by the Incheon Metropolitan City for the period of the facility ownership (50 years), and the period of the lease of the land is the same as the period of the facility ownership (the day before the 50th anniversary of the date of the inspection of the use), and the ownership of the facility is reverted to the

(2) The supply price shall be paid the down payment of KRW 5,00,000 on the day of the contract, and KRW 4,000,000 within 30 days after the date of the contract, and the intermediate payment shall be paid in five equal installments, and the first intermediate payment shall be paid in five equal installments, and the third intermediate payment shall be paid in September 20, 2003, and the fourth intermediate payment shall be paid in five equal installments, and the last intermediate shall be paid in five equal installments, and the remainder shall be paid in the date of designation of occupancy. The total supply price shall be paid in installments on March 20, 2004, as the plaintiffs' right to use the object of the contract was sold in lots during the period of land use under the concession entered into between the defendant and the Incheon Metropolitan City Mayor, and shall be attributed to the defendant at the same time as the completion of building construction, and shall not be returned during the period of land use, and any objection may not be raised (Article 1).

(3) The Plaintiffs shall pay the land rent to the Defendant. The monthly rent of the land shall be the amount calculated by dividing 5/100 of the land price announced by the Government each year for the area of the site site by 12 months (value-added tax separate), and shall be paid in advance by one month until the last day of each month. The Defendant shall pay the amount paid to the Incheon Metropolitan City Federation (Article 5).

(4) Where the plaintiffs lease or sell the leased object to a third party, they shall comply with the procedures of the management and operation agreement, and shall notify the defendant in writing within three days prior to or after the sale of the leased or the right to use (Article 8).

(5) The indication of the model house (a model house), various printed materials, the location of the facilities, design drawings, etc. on the subdivision line and the model drawing may be partially modified in accordance with the construction permit approval and report after the contract. In this case, the defendant shall be notified to the plaintiffs (Article 19(2)).

(6) The Defendant mediates an intermediate payment-free loan only upon the request of the Plaintiffs. The Plaintiffs may either repay the loan or convert the loan into a secured loan, and the interest from the first date of designation of the occupancy to the date of repayment shall be borne by the Plaintiffs. Where intending to convert the loan into a secured loan, the documents and all of the expenses necessary for the creation of the security interest may be moved into the lending bank after submitting the documents and all of the expenses to the lending bank or making a full payment (special agreement on the burden of the loan and the interest

C. The Defendant indicated, in the letter of guidance for sale (No. 2) of the instant officetel, that the instant officetel is located in the international business area where the instant officetel is located and indicated the installation route of Pms (Pms (Pms; hereinafter referred to as “Pms”) on the instant instant officetel. Among the contents of the above letter of guidance for sale, the Defendant explained, “Pms (Pms) which is the largest high-tech means of transportation, IAT connections for 24 hours, Incheon Airport is 24 hours,” and “50-year long-term use right without the registration tax (50-year use right method),” and, in the international business area where the instant officetel is located, the instant officetel was located, the Defendant explained that “Pms (Pms) was installed at the location of the airport passenger terminal and the first km, free bus operation, future Pms (Pms) in the future, and explained the content of the instant letter of guidance for sale to the Seoul Nam model to be located.”

D. The following documents exist with respect to the issue of the installation of PEs in the Incheon International Airport International Airport area where the instant officetel is located:

(1) The content of the proposed new airport construction area and the basic plan for new airport construction in June 16, 1992, published by the Ministry of Construction and Transportation No. 1992-16 of the Ministry of Construction and Transportation, does not include the content that the Pms are to be installed within the international business area. After that, the revision of the basic plan for new international airport construction in the Seoul metropolitan area (the first stage business plan) published by the Ministry of Construction and Transportation No. 1995-387 of the Ministry of Construction and Transportation on November 28, 1995, the amendment of the basic plan for Incheon International Airport construction (the first stage business) published by the Ministry of Construction and Transportation No. 1998-236 of the Ministry of Construction and Transportation on July 22, 1998, the amendment of the basic plan for the Incheon International Airport construction (the second stage business) amended by the Ministry of Construction and Transportation No. 2001-356 of Dec. 31,

(2) Meanwhile, the Incheon International Airport Traffic Center Construction Site I (No. 4) published at the early 2002 Incheon International Airport Traffic Center Construction Site I (No. 4) introduced a plan for facilities, such as the establishment of PPPs operating an airport traffic center, etc. and platforms, vehicles, passenger demand calculation, etc. for such establishment. According to each article of the Incheon Daily newspaper as of December 12, 2003, December 18, 2003, and December 19, 2003, “The development plan of PPs, a light-line, for the convenience of transportation in the separated zone between the Incheon Airport and the international business area, was to be developed from October 10 each year, 203.” In addition, Article 71 of the concession agreement (No. 10-1 of the concession agreement), which was prepared between the Incheon International Airport Traffic Center Construction Site and the Incheon International Airport Traffic Center Construction Site Construction Site and the Incheon International Airport Construction Project shall be excluded from the total of 0 PPP PP PPs and the construction route 2.

(3) The comprehensive report on the plan for the placement of facilities on the south side of a passenger terminal (No. 8-2) prepared on May 1996 included a plan for the installation of a PE and the proviso that "it is necessary to review more systematically about whether to install and operate PEs and to follow the result of the "detailed plan" related to the south side of a passenger terminal. After that, according to the final report (No. 8-3) of the Incheon International Airport Development Basic Plan prepared by the Incheon International Airport Development Promotion Committee on December 2004, the Incheon International Airport Development Basic Plan (No. 8-3) established on December 2004, the Incheon International Airport Promotion Committee recognizes that it is necessary to review the installation of PEs in a long term to solve the traffic problem of an international business area, but there is no plan to install it within a short period of time due to lack of demand and economic feasibility, and the development of an international business area is reviewed after

E. Current status of the instant officetel

(1) At present, the Incheon International Airport Traffic Control Center has a PPP platform at its entrance, and at the entrance, “this area is a facility to transport passengers between the transportation center and the international business complex. This facility is scheduled to be completed at the next second stage construction.” However, there is no PP facility installed at the next stage construction.

(2) As to the instant officetel, registration of preservation of ownership was made in the name of the Defendant on September 21, 2004; and on October 11, 2004, the provisional registration of the right to claim the transfer of ownership was made in the name of the Incheon Metropolitan City Mayor, but there was no fact that the transfer of ownership was made in the name of the Plaintiffs.

2. Determination

A. Determination as to the assertion on the establishment of PEs

(1) The plaintiffs' assertion

(A) The Defendant explained to the Plaintiffs through the instant officetel’s sales advertisement and sales guide, etc., that it would be completed by the end of 2005 between the instant officetel and the passenger terminal of the new airport. In fact, the Defendant, although having not received a promise from the Incheon Metropolitan City Mayor as to the establishment of the PMS via the instant officetel, made an advertisement with the above contents in a false manner, notwithstanding the fact that the Defendant had not received a promise from the Incheon Metropolitan City Mayor.

(B) However, as long as the sales contract for the instant officetel was concluded with the plaintiffs trusted by advertising the above contents, the defendant bears the contractual obligation to supply the officetel installed as the defendant advertised, and the defendant is ultimately liable to compensate the plaintiffs for damages due to nonperformance.

(C) In addition, when the Defendant was aware that the instant officetel via the instant officetel would not be installed, it did not comply with the obligation to notify the Plaintiffs of such fact at least prior to the payment period pursuant to Article 19 (1) of the sales contract, and did not comply with the obligation to provide the Plaintiffs with an opportunity to cancel the instant officetel sales contract without an intermediate payment loan agreement.

(2) Determination

(A) First of all, as to whether the Defendant is liable for the nonperformance of the obligation to install the instant officetel, the fact that the Defendant stated that the instant officetel connecting the instant officetel with the new airport passenger terminal by the end of 2005 is scheduled to be completed by the end of 2005 is as follows: Provided, however, the Defendant’s advertising that the instant officetel is scheduled to be completed by the end of 2005 is deemed to be based on the content of the concession agreement between Incheon International Airport Traffic Center Construction Site I and the Defendant and the Incheon Airport Construction Association. Moreover, the Defendant’s content is that the Incheon Airport Corporation’s establishment of the instant officetel via the instant officetel was first determined by the Incheon Airport Corporation, and the Defendant’s efforts cannot be made only through the Defendant’s efforts. In light of the fact that there is no provision in relation to the instant sales contract, the Defendant’s recommendation or publicity as to the construction of the instant officetel, and there is no evidence to conclude the sales contract against each of the instant parties or the Defendant’s subscription to the sales contract.

(B) Next, as to whether the Defendant is liable for nonperformance due to the failure to notify the Plaintiffs before the intermediate payment due date, it is not sufficient to acknowledge that the Defendant’s advertising that the instant officetel will be installed is based on the content of the concession agreement between the Incheon International Airport Traffic Center Construction Site I and the Defendant and the Incheon Metropolitan City Federation. Therefore, it is difficult to view that the Defendant’s advertising that the instant officetel would not be installed from the beginning was made with the knowledge of the fact that the instant officetel would not be installed, but it is difficult to view that the Defendant’s advertising was made with the first intermediate payment due to the following descriptions: (a) Nos. 4 and 7, and Nos. 8-1 through 4, which were scheduled to pay the first intermediate payment due to the instant parcelling-out contract; and (b) there is no other evidence to support that the Defendant did not know, before February 20, 2003, that the Plaintiff violated the Defendant’s duty to make the instant instant instant instant instant instant officetel alteration to the terms of the sales contract, and thus, it could not be evaluated that the Defendant did not withhold its right.

B. Determination on the assertion on the sale of the right to use

(1) The plaintiffs' assertion

In selling the instant officetel to the Plaintiffs, the Defendant explained that it is not the content of the right to sell the instant officetel, but the Defendant’s right to use for a period of 50 years, and without notifying such fact, it is the long-term use right method which does not differ from the ownership, and the Plaintiffs should be dismissed from the sale of the instant officetel. As such, the Defendant did not perform the contractual obligation to complete the registration of ownership transfer of the instant officetel building, and thereby, was subject to restriction on the exercise of property rights by preventing the Plaintiffs from being subject to the extension of repayment period for the instant officetel equivalent to the intermediate payment as security.

(2) Determination

On the other hand, the defendant's advertisement of "tax benefit without acquisition tax and registration tax (50-year use right)" in the sales guide for the instant officetel is acknowledged as above. However, unlike ordinary lease, the expression "no more than ownership" is used as a long-term term of 50 years, which means that the term of use is relatively free to lease or use to a third party. The contract of this case also includes that the ownership of the instant officetel belongs to the Incheon Airport Corporation at the same time as the period of ownership (50-year use right before the date of the inspection) expires, and it is difficult to view that the plaintiffs are not entitled to use the instant officetel for a certain period, not the object of the contract of this case, but the right to use the instant officetel for a certain period of time. In the case of sale, the defendant cannot be deemed to have a duty to complete the registration of ownership transfer for the instant officetel, and there is no other evidence that the plaintiffs are obligated to transfer the ownership transfer from each of the instant sales contracts to the plaintiffs or to transfer the ownership of the foregoing special loan to the plaintiffs.

C. Determination on the assertion on design change

(1) The plaintiffs' assertion

The Defendant did not make any notification to the Plaintiffs, but did not perform the obligation under the sales contract by changing the design of more than 100 rooms among the instant officetels to the studios, thereby reducing the construction cost for the instant officetels while bringing about a decline in the economic value of the instant officetels. The first design letter was required to install the studios in the said officetels, but did not perform the obligation under the sales contract, such as changing the design to the effect that the studios were not installed and the studios were to fall short of heat performance.

(2) Determination

In addition, there is no evidence to acknowledge that the Defendant had agreed to install a hot spring in the instant officetel at the time of the instant sales contract, or that the Defendant had carried out a hot spring construction work by using materials with low heat performance, unlike the design of petas, although the Defendant was the housing unsold in lots and constructed the previous two households in one household. However, there is no evidence to acknowledge that the construction cost of the instant officetel was reduced due to such modification of design, or that there was a decrease in the economic value of the instant officetel, or that the instant officetel was carried out by using materials with low heat performance.

D. Sub-committee

Therefore, the plaintiffs' claims seeking damages on the premise that the defendant did not perform the obligations stipulated in each of the sales contracts in this case are without merit without any need to further examine.

3. Conclusion

Therefore, the plaintiffs' claim of this case is dismissed as it is without merit, and it is so decided as per Disposition.

[Attachment List of Plaintiffs and Statement of Distribution by Creditors]

Judges Kim Jong-jin (Presiding Judge)