See Attached List of Plaintiffs (Attorney Jeon Soo-soo et al., Counsel for the plaintiff-appellant)

The head of Gangdong-gu Seoul Metropolitan Government (Law Firm Il, Attorney Lee Ba-soo, Counsel for defendant-appellant)

Seoul High Court Decision 201Na14488 delivered on May 1, 201

May 4, 2011

Seoul Administrative Court Decision 2010Guhap26346 decided October 1, 2010

1. The defendant's appeal is dismissed.

2. Of the appeal costs, the part arising between the Plaintiff and the Defendant is assessed against the Defendant, and the part arising from the intervention is assessed against the Intervenor joining the Defendant.

1. Purport of claim

On April 30, 2010, the defendant revoked the authorization of the establishment of the venture business association for the apartment housing reconstruction project.

2. Purport of appeal

The judgment of the first instance is revoked. All of the plaintiffs' claims are dismissed.

1. The part citing the judgment of the court of first instance

The reasoning of the lower court’s judgment is as follows, except for the following reasons: (a) the Plaintiffs’ assertion, (b) relevant Acts and subordinate statutes, and (c) the recognition of the facts (the second fifth to the last fifth). The reasoning of the first instance judgment shall be cited in accordance with Article 8(2) of the Administrative Litigation Act and Article 420 of the Civil Procedure Act.

○ 3 10th, the following claims are added at the trial of the plaintiffs.

【The instant project zone includes not only a housing complex but also an area which is not a housing complex (Seoul, Gangdong-gu, 131-1, 2). The intervenor did not meet the requirements for consent under Article 16(3) of the Act on the Maintenance and Improvement of Urban Areas and Dwelling Conditions for Residents (hereinafter “Act”). The instant disposition is unlawful in this regard.

○ From the 12th to the 4th 20th 20th , it shall be incorporated into “the same as the entry in the relevant Acts and subordinate statutes.”

The part concerning Article 22 of the 5 pages [the 5 pages] shall be dried as follows:

(1) Except as otherwise provided for in the Act and the articles of incorporation, a general meeting shall be held with the attendance of the majority of the members present, and the decision shall be made with the consent of the majority of the members present: Provided, That the method of deciding the selection and change of a service company (excluding a service company) referred to in subparagraphs 6 through 7 of Article 21 shall be the same as that of relocation.

2. Determination

A. According to Articles 16(2) and (3) and 14(3) of the Act, when a housing reconstruction project promotion committee intends to establish an association, it is required to hold an inaugural general meeting for establishing the association in accordance with the methods and procedures prescribed by Presidential Decree after obtaining consent from owners of land, etc. at least a certain number of land, etc., and obtain authorization from the head of the competent Si/Gun. According to Articles 17 and 27 of the Act, a cooperative which has obtained authorization for establishment is incorporated as a juristic person upon registration, and the provisions on incorporated associations in the Civil Act

According to Articles 16(5) and 17 of the Act and Article 26(1) and (2) of the former Enforcement Decree of the Act (amended by Presidential Decree No. 22151, May 4, 2010; hereinafter the same), the consent shall be obtained using a certificate of seal impression on the written consent prescribed by Ordinance of the Ministry of Land, Transport and Maritime Affairs [Form 4-3 of the former Enforcement Rule (amended by Ordinance of the Ministry of Land, Transport and Maritime Affairs No. 265, Jul. 16, 2010; hereinafter the same shall apply]. This shall include ① the outline of the building to be constructed, ② the estimated cost required for removal and new construction of the building, ③ the allocation of expenses, ④ the allocation of ownership after the completion of the project, ⑤ the matters concerning the articles of association.

According to Articles 14(1)5, 14(3), and 20(1) of the Act, Article 22 subparag. 4, and Article 22-2(4) and 22-2(5) of the former Enforcement Decree of the Act, among the duties of the promotion committee, “preparation of draft articles of association” among the duties of the promotion committee is stipulated that the articles of association shall be prepared by the association. The general meeting of the housing reconstruction association states that the articles of association shall confirm the articles of association, appoint partnership officers, appoint representatives, etc., and among them, the articles of association of the association shall be resolved with the attendance of a majority of the owners of the land, etc. (hereinafter referred to as “members”) who have

According to Article 16(1), (2), and (5) of the Act, and Article 7(1) of the former Enforcement Rule of the Act, an application for authorization shall be accompanied by the articles of association, a list of union members, a written consent, and documents proving consent, minutes of inaugural general meeting, etc.

B. Comprehensively taking account of the relevant Acts and subordinate statutes, the committee of promoters intending to establish the housing reconstruction project partnership shall prepare a draft articles of association, and then determine the articles of association with the attendance of the majority of the union members present at the general meeting and

Article 26 (2) 5 of the former Enforcement Decree of the Act requires that a written consent be included in the articles of association. However, Article 16 (2) of the Act provides that when a promotion committee intends to establish an association, it shall obtain authorization from the head of a Si/Gun by attaching the articles of association and the documents prescribed by the Minister of Land, Transport and Maritime Affairs with consent from landowners, etc., so that the consent of owners, such as land, is prior to the preparation of the articles of association. Article 20 (1) of the Act provides that the person who prepares the articles of association shall be the partnership, and the promotion committee shall not have the authority to prepare the articles of association. Article 22 subparagraph 4 of the former Enforcement Decree of the Act stipulates only the preparation of the draft articles of association as the duties of the promotion committee. In light of the fact that Article 22 subparagraph 4 of the former Enforcement Decree of the Act provides that the written consent includes the draft articles of association prepared by the promotion committee, i.e., the articles of association prepared by the promotion committee.

The phrase “when establishing a partnership association pursuant to Article 16 of the Act, the articles of association of the association shall be observed in accordance with the principle of trust and good faith, and the articles of association of the association shall be modified as prescribed by the articles of association of the association,” as stated in the letter of consent given by the instant promotion committee from the owners of the land, etc. in the form of this case, stating the above purport.”

However, it is unreasonable to interpret the content of the consent to the association to the effect that it simply agrees to and approves the articles of association fixed at the next inaugural general meeting.

(1) In order to clarify in writing whether landowners, etc. consent, objects of consent, etc., increase predictability of landowners, etc. for rearrangement projects, and prevent disputes in advance, a written consent shall be punished against the legislative intent of the Act providing that landowners, etc. consent shall be obtained by a written consent containing the articles of association (to be deemed the draft articles of association).

(2) Without establishing the articles of incorporation which are the fundamental rules of a corporation, consent to the formation of a corporation and demand participation as a member thereof.

(3) The procedures for confirmation of articles of incorporation are more easy than the amendment procedures [in principle, consent of a majority of union members (at least 2/3 in certain cases) shall be obtained pursuant to Article 20 (3) of the Act];

The defendant asserts that if the draft of the articles of incorporation and the finalized articles of incorporation require the consistency, it is merely a repetition of procedures to determine the articles of incorporation at the inaugural general meeting.

In light of the importance of the articles of incorporation, which is the fundamental rules of the corporation, the legislators are deemed to have prepared a draft articles of incorporation by the promotion committee, obtain written consent meeting the statutory consent rate from the owners of the land, etc., and again have prepared a double control system so that it can be confirmed with the attendance of a majority of the members present at

C. The owners of the land, etc. in the instant project zone consented to the draft articles of association before the modification, but they did not agree to the draft articles of association after the amendment was decided by the articles of association of the Defendant Union at its inaugural general meeting. As seen below, the draft articles of association before and after the amendment remains in an uncertain state, and the draft articles of association after the amendment remains in an uncertain state without the consent of the owners, such as land.

① Article 18(5) of the Articles of Incorporation provides that the authority to suspend the performance of duties of directors and auditors and the board of directors to take partial charge of the duties of the board of representatives and the resolution for the change was mitigated.

② Article 19(3) was amended by the president to the board of directors at the meeting of representatives, after which the president of the association has made an ex post facto approval for the appointment of paid employees.

③ Article 22(7) and (8) changed the method of resolution and the quorum for the selection and change of a service company or contractor.

④ Article 24(4) changed the eligibility to be elected as a representative.

(5) Article 41(1) of the Act deleted “A member disqualified as a partner by transferring the ownership of a building, the status of being selected as an occupant, etc.” from among those entitled to exercise a claim for sale.

(6) Article 46 subparagraph 9 of the Commercial Building Act, if the owner of an appurtenant or welfare facility, such as a commercial building, constructs a new appurtenant or welfare facility by changing “when a new appurtenant or welfare facility, is not supplied” falling under subparagraph (a) among cases where he/she is able to be supplied with one house, provided that “if a new appurtenant or welfare facility is not constructed, the value of the previous appurtenant or welfare facility is at least the value calculated by multiplying the estimated unit size of the house to be sold by the general meeting (in cases where the value of the previous appurtenant or welfare facility is not fixed, 1)” he/she deprived the owner of an opportunity to be supplied with one house at his/her option (According to the evidence No. 16 of the above Act, according to the list No. 16, the share area of the existing commercial building is 3,135.5 square meters or the share area of the new commercial building site is 1,684.8 square meters which is only half of the share area of the building site (i.e., the total floor area of the new commercial building is 497 square meters.

D. Furthermore, according to Article 26(2) of the former Enforcement Decree of the Act, a written consent shall include “(1) design outline of a building to be built, ② outlined cost required for removal and construction of a building, ③ cost sharing standards, and ④ ownership ownership after completion of the project,” in addition to “an association’s articles of association.” In the written consent received by an intervenor pursuant to the instant form, most of the items “matters concerning the reversion of divided ownership of a new building” shall be dealt with according to the management and disposal plan standards stipulated in the articles of association of the association. Therefore, if the standards for management and disposal plans stipulated in the articles of association of the association, which are the premise for the preparation of the said written consent, are substantially modified, it shall also be deemed that “matters concerning ownership after completion of the project”

As seen earlier, Article 46 subparag. 9 of the Draft Articles of Incorporation prevents the length of apartment purchase by the owners of commercial buildings. This is itself a serious change in the management and disposal plan (the title referred to in Article 46 of the Articles of Incorporation refers to the standard for the management and disposal plan). Article 46 subparag. 9 of the Draft Articles of Incorporation prior to the amendment follows the contents contained in the standard articles of incorporation, and Article 46 subparag. 9 of the draft Articles of Incorporation does not affect the fact that a management and disposal plan has been substantially modified even if the same content as Article 52(2) of the Enforcement Decree of the former Enforcement Decree of the Act is identical to that of Article 52(2) of the former Enforcement Decree after the amendment. A written consent attached to the application for authorization for establishment by the Intervenor is difficult to deem

E. The Intervenor Association received the written consent from the owner of the land, etc. and actually changed the subject of consent, but submitted the existing written consent to the Defendant without obtaining a new written consent, and received the authorization for establishment.

The Defendant’s authorization to establish an intervenor association is unlawful without having to determine whether an area, other than a housing complex, is included in the rearrangement zone in this case.

4. Conclusion

The defendant's appeal is dismissed.

[Attachment]

Judges Kim Jong-dae (Presiding Judge)