Where the project implementation method of housing redevelopment improvement project has been converted and "the person who has been designated to substitute land according to the project method before conversion" is determined as members and persons eligible for parcelling-out, the method of determining the persons eligible for parcelling-out of multi-family housing when there are several persons designated to substitute land for replotting.

In light of the language and legislative purport of Articles 19(1), 48(2)1, 6, and 7(a) and (7) of the former Act on the Maintenance and Improvement of Urban Areas and Dwelling Conditions for Residents (amended by Act No. 12116, Dec. 24, 2013); Article 52(1)3 of the Enforcement Decree of the Act on the Maintenance and Improvement of Urban Areas and Dwelling Conditions for Residents; Article 27(1)1, 4, 27(2)3, and 27(4) of the former Ordinance on the Maintenance and Improvement of Urban Areas and Dwelling Conditions for Residents (amended by Ordinance No. 5701, May 14, 2014); Article 19(1); Article 48(2)1, 6, and 7(a); Article 52(1)3 of the former Ordinance on the Maintenance and Improvement of Urban Areas and Dwelling Conditions for Residents (amended by Act No. 12116, Dec. 24, 2013);

Article 19(1), Article 48(2)1, 6, 7(a), and (7) of the former Act on the Maintenance and Improvement of Urban Areas and Dwelling Conditions for Residents (Amended by Act No. 12116, Dec. 24, 2013); Article 52(1)3 of the Enforcement Decree of the Act on the Maintenance and Improvement of Urban Areas and Dwelling Conditions for Residents;

Plaintiff (Law Firm Hyeong, Attorneys Cho Jae-soo et al., Counsel for the plaintiff-appellant)

Freeboard 1-3 Housing Redevelopment and Improvement Project Association (Law Firm Hann Law, Attorneys Jeon-soo et al., Counsel for the plaintiff-appellant)

Seoul High Court Decision 2013Nu12920 decided May 20, 2014

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

The grounds of appeal are examined.

1. Article 19(1) of the former Act on the Maintenance and Improvement of Urban Areas and Dwelling Conditions for Residents (amended by Act No. 12116, Dec. 24, 2013; hereinafter “former Act”) provides that “When the ownership and superficies of the land or a building belong to several co-ownership, one representative shall be deemed to be a member.” Article 48(2) provides that “when one household or one person owns one or more houses or land, one house shall be supplied, and when two or more persons who do not belong to the same household own one house or one land, one house shall be supplied,” Article 19(1) of the same Act provides that “when the ownership and superficies of the land or the building belongs to several co-ownership, one member representing such persons shall be deemed to be one member.” Article 48(2) provides that “The criteria for the management and disposal plan shall be balanced and reasonable, taking into account the size, use, environment, and other matters of the previous land or building, one house shall be allocated to the applicant for parcelling-out, and disposal plan shall be separately prescribed by municipal ordinance.”

Article 52(1)3 of the Enforcement Decree of the Act on the Maintenance and Improvement of Urban Areas and Dwelling Conditions for Residents (hereinafter “Enforcement Decree of the Act”) provides that “The owner of a plot of land, etc., who is not in compliance with the standards for the amount, size, acquisition time, or type prescribed by municipal ordinance of a City/Do, may be excluded from the sale subject as prescribed by municipal ordinance of a City/Do.” Accordingly, Article 27(1)1 of the former Ordinance on the Maintenance and Improvement of Urban Areas and Dwelling Conditions for Residents (amended by Ordinance No. 5701, May 14, 2014; hereinafter “former Ordinance on the Maintenance and Improvement of Urban Areas and Dwelling Conditions for Residents”) provides that “The owner of a plot of land, etc., other than a person holding a superficies, shall be excluded from the sale subject of a house redevelopment project pursuant to Article 52(1)3 of the Enforcement Decree of the Act on the Maintenance and Improvement of Urban Areas and Dwelling Conditions for Residents,” and Article 27(1)3 of the former Ordinance on the Maintenance and Improvement of Urban Areas and Dwelling shall be excluded from the sale subject.

In light of the language and legislative intent of the former Act, the Enforcement Decree of the Act on the Improvement of Urban Areas and Dwelling Conditions, and the former Ordinance on the Maintenance of Urban Areas and Dwelling Conditions, in cases where ownership, etc. of land or buildings belongs to several co-ownerships, only one house is provided to the land or buildings jointly owned by deeming one representative of the number of co-ownerships. Therefore, even when the project implementation method is converted, where “the owner of a house (including a building prescribed by the articles of association, etc. among the previous buildings used for residential purpose) among the buildings before conversion” is designated as a partner and a person eligible for parcelling-out, one representative of the number of designated land substitution shall be deemed as a member, and only one multi-family house shall be provided to the land substitution. However, it can be interpreted that all the designated persons, regardless of the size of the land substitution area or whether the land substitution area can be separately designated

2. According to the reasoning of the judgment below and the record, the defendant's articles of incorporation provides that "the partner shall be the owner of the land, etc. in the project district, but the person designated as the land substitution in the project district shall be included in the case of a change of the project implementation method, and the owner of the land substitution in the project district shall be excluded in the case of a change of the project implementation method (Article 9 (1)), "where the ownership and superficies of the land or buildings and the land substitution in lots belong to several co-ownerships" or "when several owners of the land, etc. and the designated person as the land substitution in lots belong to one household" shall be regarded as one member representing the number (Article 9 (4) 1 and 2), and the person designated the land substitution in accordance with the project method before the conversion shall be determined as "the person designated the land substitution in lots" regardless of the size of the land substitution area or the joint land substitution, and in the case of several persons deemed as one member pursuant to Article 9 (4), the applicants for parcelling-out shall be regarded as the land sale.

Therefore, if there are several persons designated as the land reserved for replotting as of the base date of the management and disposal plan among the members of the association who filed an application for parcelling-out of collective housing in the management and disposal plan, the determination that one unit of multi-family housing for the applicants for parcelling-out is unlawful as it is in accordance with the former Urban Improvement Act, the Enforcement Decree of the Urban Improvement Act, the former Ordinance on the Maintenance and Improvement, and the defendant's articles of incorporation. Ultimately, even though the plaintiff (appointed parties) and the designated parties (hereinafter "Plaintiffs et al.") independently applied for parcelling-out of multi-family housing, the defendant did not grant one unit of multi-family housing for the plaintiff et al. jointly designated pursuant to the above management and disposal plan, and did not violate the above relevant provisions and the defendant'

Nevertheless, the court below held that the defendant's measures that did not grant the right to sell a house to each of the plaintiff et al. are invalid on the ground that the plaintiff et al. constitutes "the owner of a house (including a building prescribed by the articles of association, etc. among the previous unauthorized buildings used as a residential purpose) among the previous buildings" under Article 27 (1) 1 of the former Act. The court below erred by misapprehending the legal principles on qualifications for the purchaser in a housing redevelopment project where the project implementation method has been converted, thereby adversely affecting the conclusion of the judgment. The

3. Therefore, without examining the remaining grounds of appeal, 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 by the assent of all participating Justices on the bench.

[Attachment] List of Appointeds: Omitted

Justices Jo Hee-de (Presiding Justice)