In a case where an industrial complex development plan was amended by Presidential Decree No. 24190 on November 20, 2012, but there was a certain change in the site for energy supply facilities after the enforcement of the Industrial Sites and Development Act, which was amended by Presidential Decree No. 24190 on November 20, 2012, and became effective, and accordingly, an industrial complex development plan was amended, whether Article 1-2 of the Enforcement Decree of the Industrial Sites and Development Act is applied pursuant to Article 2 of the Addenda to the Enforcement Decree of the Industrial Sites

Article 2 Subparag. 7-2 of the Industrial Sites and Development Act (amended by Act No. 11474, Jun. 1, 2012) newly established a definition provision of a site for industrial facilities, so that the site for industrial facilities may be determined by Presidential Decree. Accordingly, the Enforcement Decree of the Industrial Sites and Development Act (amended by Presidential Decree No. 24190, Nov. 20, 2012; hereinafter “Enforcement Decree of the amended Industrial Sites Act”) amended newly established Article 1-2, included the site for energy supply facilities under subparagraph 6 of Article 2 of the Energy Act in the site for industrial facilities (Article 1-2). The main text of Article 40(1) of the amended Enforcement Decree of the Industrial Sites Act provides that “If a project operator sells the land, facilities, etc. developed by the project operator to the site for industrial facilities, the sale price shall be the development cost, in principle, the site for installing a transformation facility falling under the energy supply facilities under the Energy Act constitutes a site for industrial facilities.”

Meanwhile, Article 2 of the Addenda to the Enforcement Decree of the Industrial Sites Act provides that “The amended provisions of Article 1-2 shall apply from the time an industrial complex is designated or an industrial complex development plan is modified after the enforcement of the above Act.” The main purpose of Article 2 of the Addenda to the Enforcement Decree is to prevent the legal treatment of the same kind of industrial facility or like industrial facility before and after the application of the amended provisions from changing the site to the site for industrial facilities. In full view of the language and purport of Article 2 of the Addenda to the above Enforcement Decree, Article 1-2 subparag. 1 of the Enforcement Decree of the amended Industrial Sites Act is not limited to the case of new installation of energy supply facilities or addition of business type to the existing industrial facility through the alteration of the industrial complex development plan. Accordingly, even if the existing industrial complex development plan had already been included in the industrial complex development plan, a certain change in the site for energy supply facilities has already been changed, barring special circumstances, it can be seen as a site for the relevant industrial facility site under Article 1-2 of the amended Enforcement Decree of the Industrial Sites Act.

Article 2 Subparag. 2 of the Industrial Sites and Development Act (Amended by Act No. 11690, Mar. 23, 2013); Article 1-2 and Article 40(1) of the Enforcement Decree of the Industrial Sites and Development Act (Amended by Presidential Decree No. 24443, Mar. 23, 2013); Article 2 of the Addenda to the Enforcement Decree of the Industrial Sites and Development Act (Amended by Act No. 24443, Nov. 20, 2012)

Korea Electric Power Corporation (Attorney Lee Jae-tae, Counsel for defendant-appellee)

Korea Water Resources Corporation (Law Firm Song, Attorneys Choi Jong-man et al., Counsel for the plaintiff-appellant)

Seoul High Court Decision 2015Na2012268 decided September 8, 2015

The appeal is dismissed. The costs of appeal are assessed against the defendant.

The grounds of appeal are examined (to the extent of supplement in case of supplemental appellate briefs not timely filed).

1. Article 2 Subparag. 7-2 of the Industrial Sites and Development Act (amended by Act No. 11474, Jun. 1, 2012; hereinafter “Revised Industrial Sites Act”) newly established a definition provision for sites for industrial facilities, so that the sites for industrial facilities may be determined by Presidential Decree. Accordingly, the Enforcement Decree of the Industrial Sites and Development Act (amended by Presidential Decree No. 24190, Nov. 20, 2012; hereinafter “Enforcement Decree of the amended Industrial Sites Act”) newly established Article 1-2, included energy supply facilities under subparagraph 6 of Article 2 of the Energy Act in sites for industrial facilities (Article 1). The main sentence of Article 40(1) of the Enforcement Decree of the amended Industrial Sites Act provides that “If a project operator sells land, facilities, etc. developed by him/her as sites for industrial facilities, the sale price shall be determined as the development cost if the site falls under the site for facilities for industrial facilities under energy transformation under the Energy Act.”

Meanwhile, Article 2 of the Addenda to the Enforcement Decree of the Industrial Sites Act provides that “The provisions of Article 1-2 shall apply to cases where an industrial complex is designated or an industrial complex development plan is modified after the enforcement of the above Act.” The main purpose of Article 2 of the Addenda to the Enforcement Decree is to prevent the legal treatment of the same kind of industrial facility or like industrial facility before and after the application of the amended provisions from changing the site to the site for industrial facilities. In full view of the language and purport of Article 2 of the Addenda to the above Enforcement Decree, Article 1-2 subparag. 1 of the Enforcement Decree of the amended Industrial Sites Act is not limited to cases where a new installation of energy supply facilities or an addition of a type of energy supply facilities to the existing industrial facility through the alteration of the industrial complex development plan. Accordingly, even if an industrial complex development plan had already been included in the existing industrial complex development plan, a certain change in the site for energy supply facilities has already been changed, barring any special circumstance, it can be seen as a site for the relevant industrial facility site.

2. The lower court accepted the Plaintiff’s claim seeking confirmation that there is no obligation to pay the purchase price corresponding to the difference between the appraised value of the instant site and the development cost on the following grounds.

A. After the enforcement of the amended Enforcement Decree of the Industrial Sites Act, on December 20, 2013, the development plan for the development of the zone was amended through the public announcement (No. 2013-803 (Public Notice No. 18166) of the Ministry of Land, Infrastructure and Transport’s Official Gazette No. 2013-803 (Public Notice No. 2012, Dec. 20, 2013). Accordingly, the location and area of the plan was modified among the semi-monthly special areas.

Therefore, Article 1-2 of the Enforcement Decree of the Industrial Sites Act is applied in accordance with Article 2 of the Addenda to the Enforcement Decree of the amended Industrial Sites Act because the industrial complex development plan is changed after the enforcement of the amended Industrial Sites Act.

B. On June 25, 2014, the Plaintiff entered into a land sale agreement with the Defendant that purchased the instant site for the purpose of power supply facilities. The instant site was sold to the Plaintiff for the purpose of installing a substation that constitutes energy supply facilities, and constitutes a site for industrial facilities pursuant to subparagraph 1 of Article 1-2 of the Enforcement Decree of the amended Industrial Sites Act. Accordingly, the sale price ought to be calculated as the development cost pursuant to the main sentence of Article 40(1) of the Enforcement Decree of the amended Industrial Sites Act.

3. Examining the reasoning of the lower judgment in light of the foregoing legal doctrine, the lower court’s determination is justifiable. In so determining, contrary to what is alleged in the grounds of appeal, the lower court did not err by exceeding the bounds of the principle of free evaluation of evidence against logical and empirical rules, or by misapprehending the legal doctrine regarding “a change in an industrial complex development plan” and the exercise

4. The Defendant’s appeal is dismissed as it is without merit, 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 on the bench.

Justices Lee Dong-won (Presiding Justice)