Whether a lessee who has acquired an opposing right against a building on which a right of lease has been established may oppose a successful bidder who has won such real estate because a compulsory auction by application of the third executor's creditor is in progress.

Where there is a housing lessee with opposing power between the registration of the establishment of a neighboring mortgage and the application for a compulsory auction by an execution creditor of the third execution creditor, if the same person can oppose the successful bidder, the successful bidder is bound to bear the burden of the right of lease and the auction price of the real estate is reduced to the same extent. This is not consistent with the purport of the security right securing exchange value at the time of the establishment because it is the result of undermining the prior security right than the right of lease, and therefore, the right of lease

Article 608(2) of the Civil Procedure Act, Article 3 of the Housing Lease Protection Act

Plaintiff

Defendant

Seoul High Court Decision 86Na7 delivered on June 26, 1986

The appeal is dismissed.

The costs of appeal are assessed against the defendant.

As to the Defendant’s ground of appeal:

According to the reasoning of the judgment below, the court below, based on adopted evidence, concluded a lease contract with the non-party who was the owner of the building of this case and entered into a lease contract of KRW 13,00,000 on March 5, 1983, and reported the transfer of resident registration at the same time, and determined that the plaintiff could not have succeeded to the status of the plaintiff as the successful bidder of this case since the registration of establishment of a lease contract was completed on September 3, 1980 with the Seoul Trust Bank as the mortgagee, and again on October 13, 1982 with the establishment of a lease contract of KRW 21,00,000,00 with the maximum debt amount as the right to collateral security at the request of other creditors on April 12, 1984, since the auction was initiated, the court below acknowledged that the plaintiff was the successful bidder of this case on Nov. 27, 1984.

When a compulsory auction is held in respect of a real estate on which a right to collateral security has been established, the right to collateral security established prior to such compulsory auction is extinguished as a result of the auction (Article 608(2) of the Civil Procedure Act). In this case, if a person having a right to collateral security with the opposing power between the registration of establishment of a right to collateral security and the application for compulsory auction has a right to collateral security right and the person having a right to collateral security right can oppose the successful bidder, the successful bidder is bound to bear the burden of lease on the right to collateral security, so the auction price of real estate would be reduced to the degree, and this is not consistent with the purpose of the security right to secure the exchange value at the time of the establishment

In this regard, the lower court’s judgment that the Defendant’s right of lease cannot be asserted against the Plaintiff, the successful bidder, is justifiable. The arguments are groundless.

Therefore, the appeal is dismissed, and the costs of appeal are assessed against the losing party. It is so decided as per Disposition by the assent of all participating Justices.

Justices O Sung-sung (Presiding Justice)