2012Da59268 Undue gains

2012Da59275 (Consolidated) Unjust Enrichment

2012Da59282 (Consolidated) Unjust Enrichment

It is as shown in the attached list of plaintiffs.

1. Gender Nam-si;

2. The Korea Land and Housing Corporation and the Korea Land and Housing Corporation which take over litigation;

Seoul High Court Decision 2011Na11346 Decided May 24, 2012

October 17, 2013

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

The grounds of appeal are examined.

1. As to the ground of appeal by Defendant Korea Land and Housing Corporation

According to Article 78 of the former Act on the Acquisition of Land, etc. for Public Works and the Compensation therefor (amended by Act No. 8665 of Oct. 17, 2007; hereinafter referred to as the "former Public Works Act"), a project operator shall establish and implement relocation measures or pay resettlement funds as prescribed by Presidential Decree for persons who are deprived of their base of livelihood due to the provision of residential buildings due to the implementation of public works (hereinafter referred to as "persons subject to relocation measures"), and the contents of relocation measures include basic living facilities according to the relevant regional conditions, such as roads, water supply facilities, drainage facilities, and other public facilities in the resettlement area, and the cost necessary therefor shall be borne by the project operator and borne by the project operator (Article 4). Accordingly, if a special supply contract between a person subject to relocation measures and a project operator included the cost of installation of the main facilities as stipulated in Article 78(4) of the former Public Works Act in the sale price of a housing site or housing, the portion of the special supply contract included the cost of installation of the basic living facilities in the public works.

According to the reasoning of the judgment below, in entering into a special supply contract with the plaintiffs who are subject to relocation measures (hereinafter referred to as the "Defendant Corporation") on the instant housing site, the part that does not exceed 265 square meters is calculated by comparing the amount calculated by deducting basic facilities installation costs according to the calculation method of the Defendant Corporation based on the cost of the housing site development with the amount equivalent to 80 percent of the cost of the housing site development. In light of the above legal principles, if the supply price of the said housing site includes basic facilities installation costs in light of the above legal principles, it shall be deemed that unjust enrichment is established, and the above supply price of the housing site does not fall under the cost of the housing site. In this case where the supply price of the housing site is not determined on the basis of appraisal price, the argument that the cost of the basic living facilities should be calculated on the basis of the supply price of the housing site equivalent to the appraisal price shall not be accepted.

According to the reasoning of the judgment below, the court below calculated the sales price per 1 kilometer by deducting the cost of basic facilities per m from the cost of creating housing site from the cost of creating housing site per 1 meter, and determined each unjust enrichment against the Plaintiffs of the Defendant Corporation by calculating the sales price exceeding the sales price calculated as above.

In this case where the Defendant Corporation set the supply price of the housing site at a certain amount at the cost of creating the housing site, as seen earlier, the method of calculating the lower court’s above is just as it calculated the cost equivalent to the cost of installing the main facilities included in the supply price of the housing site as unjust enrichment. In so doing, contrary to what is alleged in the grounds of appeal, the lower court did not err by misapprehending the legal doctrine on interpretation of Article 78(4) of the former Public Works Act and calculation

2. As to the Defendants’ grounds of appeal

(a) Whether to recognize the obligation to return profits added to the cost of installing the basic living facilities;

According to the reasoning of the judgment below, if the cost of the instant housing site sold by the Defendants is calculated by aggregating the cost of the basic living facilities and the remainder, and if the Defendants added a certain percentage of profit to the cost when determining the supply price of the housing site, it is reasonable to deem that such profit is the sum of profit added to the cost of the basic living facilities and profit added to the remainder of the cost. As such, in calculating unjust enrichment on the cost of the basic living facilities included in the supply price of the housing site after the sale of the housing site due to the addition of profit, the lower court determined that it should be included in the unjust enrichment

However, according to the reasoning of the judgment below and the fact-finding conducted by the court of first instance on the head of the relevant urban development project group, the supply price of the portion not exceeding 265 meters out of the housing site sold to the plaintiffs is not determined by adding a certain ratio to the development cost of the housing site; rather, according to the calculation method of Defendant Corporation, the supply price of the portion not exceeding 265 meters out of the housing site sold to the plaintiffs is determined by applying the difference rate of 1,691,804 per meter calculated by deducting the basic facilities cost per meter from the development cost of the housing site according to the calculation method of Defendant Corporation, and by applying the difference of 1,691,804 won calculated by averaging the total amount of new public facilities cost per meter. Thus, the part of the supply price of the portion not exceeding 265 meters out of the housing site sold to the plaintiffs exceeds the amount obtained by multiplying the

Nevertheless, the lower court limited the Defendants’ profit to the portion of the housing site supply price exceeding 265m2 of the housing site that was partially purchased by the Plaintiffs, which exceeds the amount exceeding the amount exceeding the above 1,691,804m2, and included the amount of unjust enrichment to be returned by the Defendants. In so doing, the lower court erred by misapprehending the legal doctrine on the scope of unjust enrichment to be returned by the Defendants pursuant to Article 78(4) of the former Public Works Act, thereby adversely affecting the conclusion of the judgment.

(b) Acknowledgement of the cost of installing basic living facilities;

1) The purpose of Article 78(4) of the former Public Works Act is to provide the person subject to the relocation measures with a basis of living. Thus, the term "basic living facilities according to the relevant local conditions, such as roads, water supply facilities, drainage facilities, and other public facilities," which are stipulated in the relevant provision, such as roads, water supply and drainage facilities, and "basic living facilities according to the relevant local conditions" means roads, water supply and drainage facilities, electric facilities, communications facilities, gas facilities, and district heating facilities, which are to be installed by a project proprietor who implements a housing construction project or a housing site development project pursuant to the relevant statutes, such as Article 23 of the Housing Act (see the above en banc Decision). The purpose of the above decision is to clarify the basic living facilities through the concept of arterial facilities stipulated in Article 78(4) of the former Public Works Act, which are to be provided as a basis of living for the person subject to the relocation measures.

2) In calculating the cost of installing basic living facilities in relation to the housing site development project of this case, the lower court, as the cost of the basic living facilities, shall include the traffic plaza, water supply site, pressura, sewage treatment site, drainage site, transformation station, etc.

Each site cost is reasonable in light of the legal principles as seen earlier, including (2) cost for building the basic living facilities, (3) cost, direct labor cost, sales cost, management cost, capital cost, and other cost related to building the basic living facilities calculated by the method as stated in its holding, and there is no error of law that affected the conclusion of the judgment by misapprehending the legal principles as to the scope of the cost of building the basic living facilities, etc. as alleged in the grounds for appeal.

3) In addition, in calculating the cost of creating basic living facilities, the lower court included the cost of installing street lamps, underground street roads, tunnels, bridge (rivers, etc.) and bridges in full without limit to the part related to roads with a width of at least 200 meters and at least eight meters in length in the zone subject to the instant housing site development project. In a housing site development project zone, roads which a project operator who implements a housing construction project or a housing site development project shall provide as basic living facilities to a person subject to relocation measures within the housing site development project zone shall include roads corresponding to arterial facilities prescribed in subparagraph 8 of Article 2 of the former Housing Act (amended by Act No. 9405 of Feb. 3, 2009), i.e. roads connected to the same roads outside the housing complex, and contrary to what is alleged in the grounds of appeal, there is no error in the misapprehension of legal principles as to the scope of cost of basic living facilities, etc., which affected the conclusion of the judgment.

4) On the other hand, the court below held that even if the Defendants shared the instant contributions in accordance with the measures to improve metropolitan transportation as stipulated under Article 7 of the former Act on the Management of Intercity Transport in Metropolitan Areas (amended by Act No. 8251, Jan. 19, 2007; hereinafter referred to as “former Intercity Transport”), it is difficult to view that the Defendants constitute “basic living facilities according to the relevant regional conditions” under Article 78(4) of the former Public Works Act. However, the part where the Defendants transferred the instant contributions to the supply price of the Plaintiffs’ housing sites is invalid in violation of Article 11-2(1)3 of the former Special Act on the Management of Intercity Transport in Metropolitan Areas (amended by Act No. 8251, Jan. 19, 2007; hereinafter referred to as “former Intercity Transport”), and even if the Defendants shared the instant contributions to the Plaintiffs in accordance with the measures to improve metropolitan transportation as stated in its reasoning, the Defendants cannot have again bear them.

However, it is difficult to accept such judgment of the court below for the following reasons.

According to the provisions of Article 2 of the former Metropolitan Transport Act, the term "metropolitan area" means an area prescribed by the Presidential Decree among the areas located in the Special Metropolitan City, Metropolitan Cities and their cities under the provisions of Article 2 (1) 1 of the Local Autonomy Act ( subparagraph 1); the term "wide traffic facilities" means traffic laboratories for dealing with a wide-area traffic demand of metropolitan areas, which meet the requirements prescribed by the Presidential Decree (hereinafter referred to as "wide"), such as roads covering two or more Special Metropolitan Cities, Metropolitan Cities and Dos (hereinafter referred to as "City/Do"), and urban railroads or railroads operated over two or more Cities/Dos (hereinafter referred to as "wide railroad") which meet the requirements prescribed by the Presidential Decree, such as urban railroads or railroads (hereinafter referred to as "large-area railroad") which meet the requirements prescribed by the Presidential Decree, and the operator shall faithfully establish and implement measures for improvement under the provisions of Article 20 (2) of the former Enforcement Decree of the Metropolitan Transport Promotion Act, such as the total area affected by the metropolitan transport in metropolitan areas after consultation with the Minister of Construction and Transportation under the provisions of paragraph (1).

Meanwhile, according to the former Metropolitan Transport Act, a person who implements a housing site development project under the Housing Site Development Promotion Act among metropolitan transport facilities in a metropolitan area prescribed by Presidential Decree shall pay metropolitan transport facilities charges for the construction and improvement of metropolitan transport facilities (Article 11 subparagraph 1 of the same Act), no charges for metropolitan transport facilities shall be imposed on a housing site and a housing construction project in accordance with the implementation of relocation measures under Article 8 of the Act on Special Cases concerning the Acquisition of Land for Public Use and the Compensation Therefor (Article 11-2 (1) subparagraph 3 of the same Act), and the content, form, and purport of the above-mentioned relevant Acts and subordinate statutes. In full view of the cost paid by a large-scale development project operator pursuant to the measures for the improvement of metropolitan transport facilities under Article 7 of the former Metropolitan Transport Act cannot be deemed as a cost for establishing a metropolitan road to deal with a large-scale transport demand in a metropolitan area, and the cost for installing a metropolitan railroad transport facility under the relevant local conditions under Article 78 (4) of the former Public Works Act, and even if the project operator concluded the aforementioned charges with the project operator without any legal burden.

However, according to the reasoning of the lower judgment and the evidence admitted by the lower court, the instant housing site development project includes the following: (a) the area of the instant housing site development project is 9,315,000 square meters; (b) the capacity of the accommodation is 29,674 households in large-scale development projects; and (c) the measures to improve metropolitan transportation, which became final and conclusive regarding the said project, include the Defendants’ share of KRW 440 billion, which is 37% of the construction cost for Gyeyang-Yan-Yannan roads; and (b) KRW 420 billion, which is 18% of the construction cost for status-based railroads; and (c) it is reasonable to view the instant contributions, which are such content, as the share in accordance with the measures to improve metropolitan transportation under Article 7 of the former Metropolitan Transport Act. Accordingly, in light of the aforementioned legal principles, the instant contributions

Nevertheless, the court below erred by misapprehending the legal principles on Article 7 of the former Wide School Act, which affected the conclusion of the judgment, in determining that the Defendants shall refund the portion of the instant contribution included in the supply price of the Plaintiffs’ housing site as unjust enrichment.

3. Conclusion

Therefore, 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 on the bench.

Justices Kim Yong-deok

Justices Shin Jae-young in charge

Justices Lee Sang-hoon

Justices Kim Gin-young

A person shall be appointed.

A person shall be appointed.

A person shall be appointed.

A person shall be appointed.