Plaintiff (Attorney Park Jong-young, Counsel for the plaintiff-appellant)

Defendant 1 and one other (Law Firm Jeong, Attorneys Kim Hyun-un et al., Counsel for the defendant-appellant)

June 3, 2011

Seoul Central District Court Decision 2010Da350279 Decided February 16, 2011

1. The part against the plaintiff corresponding to the money ordered to be paid under the judgment of the court of first instance shall be revoked.

2. The Defendants jointly and severally pay to the Plaintiff 21 million won with 5% interest per annum from March 12, 2010 to July 1, 201, and 20% interest per annum from the next day to the day of full payment.

3. The plaintiff's remaining appeals against the defendants are all dismissed.

4. 3/4 of the total costs of litigation shall be borne by the Plaintiff, and the remainder by the Defendants, respectively.

5. Paragraph 2 can be provisionally executed.

The judgment of the first instance is revoked. The Defendants jointly and severally pay to the Plaintiff 70 million won with 5% interest per annum from March 12, 2010 to the service date of a duplicate of the complaint of this case, and 20% interest per annum from the next day to the day of full payment.

1. Quotation of judgment of the first instance;

The reasoning for this Court’s reasoning is as follows, except for adding the following judgments as to the matters asserted by the plaintiff in the trial, and therefore, it is consistent with the reasoning of the judgment of the court of first instance pursuant to the main sentence of Article 402 of the Civil Procedure Act.

2. Additional determination

A. The parties' assertion

The Plaintiff asserts that at the time of the brokerage of the lease of the instant building, Defendant 1 did not explain to the Plaintiff on the legal relationship, such as deposit money, etc. of other lessees of the instant multi-household housing (hereinafter “instant multi-household housing”), including the instant building, at the time of the brokerage of the lease of the instant building. Accordingly, the Plaintiff, who concluded a lease contract on the instant building, suffered damages from which the Plaintiff was unable to recover at all the deposit money on the wind of the instant multi-household housing at the time of the successful bid, the Defendants jointly and severally liable to pay the Plaintiff the deposit amount of KRW 70,00

As to this, Defendant 1, at the time of the lease brokerage, did not have a duty to accurately verify and explain the matters concerning the legal relationship, such as the right to collateral security and senior lessee, established with respect to the instant multi-household housing, and to inform the lessee of the possibility of recovering the market price or the lease deposit of the object of the lease brokerage. In addition, the Plaintiff asserted that the Plaintiff’s assertion is groundless since there are other lessees in the instant multi-household housing and the total amount of the lease deposit is well known.

(b) Fact of recognition;

(1) The instant multi-household housing is a form that can move in by 13 households. As each right to collateral security regarding the instant multi-household housing is established in a sum of the maximum debt amount of KRW 232 million with respect to the instant multi-household housing, if an auction procedure is conducted based thereon, the opposing power of the instant building may be lost, and there was a risk that the Plaintiff may not receive the deposit from the distribution procedure, depending on the number of prior lessees and the amount of the deposit for lease deposit.

(2) On January 6, 2009, Defendant 1, while mediating a lease agreement on the instant building, notified the Plaintiff of the maximum debt amount regarding the right to collateral security stated on the registry of the instant multi-household housing at the time, and stated that the special agreement is stipulated in the lease agreement. However, with respect to the lease relationship on the instant multi-household housing, Defendant 1 did not accurately notify the Plaintiff of the amount of the deposit of the lessee residing at the time, the date of moving-in report, the fixed date of confirmation, etc., and did not entirely state it in the actual legal relationship column

(3) On January 6, 2006, the Plaintiff entered into a lease agreement with Nonparty 1 (the Nonparty in the judgment of the Supreme Court) stating that the lease deposit for the instant building shall be KRW 70 million and that Nonparty 1 shall cancel each of the instant multi-households at the same time with the deposit of the lease deposit as to the instant multi-households by the end of April 2009 and the deposit of the lease deposit as to subparagraph 302 (hereinafter “instant lease agreement”). The Plaintiff paid KRW 70 million to Nonparty 1 and moved into the instant building.

(4) However, Nonparty 1 did not cancel the registration of creation of a mortgage on each of the instant multi-households until the time of the agreement, and thereafter, the auction procedure was initiated regarding the instant multi-households, and only 15 persons, including the mortgagee, delivery right holder, small lessee, and lessee who obtained the fixed date, were paid dividends in the above auction procedure, and the Plaintiff did not receive dividends in lower order and did not receive a refund of the lease deposit from Nonparty 1.

[Ground of recognition] Facts without dispute, Gap 1 through 6, 8 through 20, Eul 4 and 5 (including virtual numbers), the purport of the whole pleadings

C. Determination

(1) Occurrence of damages liability

(A) Relevant statutes

The Business Affairs of Licensed Real Estate Agents and Report of Real Estate Transactions Act (hereinafter “Licensed Real Estate Agents Act”)

Article 25 (Confirmation and Explanation of Object of Brokerage)

(1) Upon receipt of a request for brokerage, a broker shall confirm the following matters before the completion of brokerage and explain such matters conscientiously and correctly to the brokerage client who intends to acquire the right to the relevant object, and present evidentiary materials, such as the land cadastre and the certified copy of the register:

1. Current state, location and right relationship of the relevant object of brokerage;

2. Restrictions on transactions or utilization pursuant to Acts and subordinate statutes;

3. Other matters prescribed by Presidential Decree.

(2) A broker may, if necessary for confirmation and explanation under paragraph (1), request the client, lessee, etc. of the object of brokerage to furnish the data concerning the state of the relevant object of brokerage.

Article 29 (Basic Ethics of Brokers, etc.)

(1) A broker and his/her affiliated licensed real estate agent shall maintain their dignity as professionals, and perform affairs related to brokerage fairly and in good faith.

Article 30 (Guarantee of Liability for Damages)

(1) When a broker causes property damage to a transaction party by intention or negligence while performing brokerage, he/she shall be liable for the damage.

Article 21 (Confirmation and Explanation of Object of Brokerage)

(1) Matters that a broker shall confirm and explain pursuant to Article 25 (1) of the Act shall be as follows:

2. Matters concerning the relationship of rights of the object of brokerage, such as ownership, chonsegwon, mortgages, superficies, and leases;

(3) A broker shall deliver a copy of the confirmation and explanatory note of the object of brokerage prescribed by Ordinance of the Ministry of Land, Transport and Maritime Affairs to the parties to a transaction, stating the matters prescribed in the subparagraphs of paragraph (1)

(B) In light of the above relevant laws and regulations and the purport of imposing the duty to explain the broker to the broker pursuant thereto, if the object of lease is sold at auction, such as whether the lessee can secure the security deposit if the object of lease is leased at the time of concluding the lease contract, the broker who has superior interests over the lessee in terms of experience and knowledge in the situation where it is at issue due to the relationship between the leased object and the multi-household housing, shall explain the important information in determining whether the lessee can lease at the time of entering into the lease contract. If there is a danger, the broker shall be obliged to notify the lessee of the fact and to take into account

As to the instant case, Defendant 1, a broker, had the Plaintiff, the Plaintiff, who is the client, explained that he could not be protected as a small-sum lessee since the deposit amount was 70 million won for the instant multi-household auction, and that the Plaintiff could incur losses due to the Plaintiff’s failure to recover the deposit amount, as well as the matters concerning the ownership of the instant multi-household house including the instant multi-household house, mortgage, and the amount of deposit deposit, the date of move-in report, the fixed date, etc. by the first lessee who actually moves into the instant multi-household house, and explained the details thereof in writing to the Plaintiff by entering in the “actual relationship” column in the above form and faithfully and accurately to the Plaintiff. However, Defendant 1 did not confirm that the right relationship of the instant multi-household house was due to the Plaintiff’s failure to confirm the existence and/or negligence to the Plaintiff as the broker of the instant multi-household house.

Therefore, Defendant 1 is liable to compensate the Plaintiff for the damages incurred by negligence in the brokerage act under Article 30 of the Licensed Real Estate Agent Act, and Defendant 1 is jointly and severally liable for the damages incurred by the Plaintiff in relation to the instant lease agreement with Defendant 1 under the mutual aid agreement concluded with Defendant 1.

(2) Limitation on liability for damages

However, as a result of the perusal of the copy of the register of the building of this case, the plaintiff appears to have known that the building of this case was part of a multi-household house, not an aggregate building. In the form of the multi-household house of this case, there are many tenants who already reside by entering into a lease contract with the non-party 1 as well as sufficient recognition that the amount of the lease deposit is equal to that of the plaintiff's lease deposit, and the amount of the lease deposit should be equal to that of the plaintiff's lease deposit. Under the situation where the first priority mortgage was already established, the plaintiff should not hear only explanation about the existence and amount of the lease deposit of the multi-household house of this case from the broker or lessor, and should actively request explanation about the existence and confirmation thereof, or verify the market price of the multi-household house of this case, the amount of the priority lease deposit of this case, and the possibility of returning the lease deposit by himself, and should determine whether to enter into the lease contract based on this, the plaintiff's fault should be limited to 30% of this case's lease contract.

D. Sub-committee

Therefore, the Defendants are jointly and severally liable to claim against the Plaintiff about KRW 21 million (=70 million x 30%) and the amount of damages for delay by each rate of 20% per annum as stipulated in the Civil Act from March 12, 2010, which is the date when the distribution schedule was formulated, to July 1, 201, the date when the judgment is rendered, that is, the Defendants have a duty to claim as to the existence and scope of such obligation.

3. Conclusion

Therefore, the plaintiff's claim against the defendants shall be accepted within the scope of the above recognition, and the remaining claims shall be dismissed as without merit. Since the judgment of the court of first instance is partially unfair, the part against the plaintiff corresponding to the above order of payment among the judgment of the court of first instance shall be revoked and the above part shall be ordered to pay the above amount to the defendants. The plaintiff's remaining appeal against the defendants shall be dismissed as it is without merit. It is so decided as per Disposition.

Judges Kim Jong-sung (Presiding Judge)