Plaintiff (Law Firm Lowsty et al., Counsel for the plaintiff-appellant)

Defendant (Attorney Han-soo et al., Counsel for defendant-appellant)

September 19, 2019

Daejeon District Court Decision 2018Kadan465 Decided August 30, 2018

1. The judgment of the court of first instance is modified as follows.

A. The Defendant shall pay to the Plaintiff 20 million won with 5% interest per annum from January 31, 2018 to October 31, 2019, and 15% interest per annum from the next day to the day of complete payment.

B. The plaintiff's remaining claims are dismissed.

2. Of the total litigation costs, 40% is borne by the Plaintiff, and the remainder is borne by the Defendant, respectively.

3. The above paragraph 1(a) may be provisionally executed.

The judgment of the first instance is revoked. The defendant shall pay to the plaintiff 20 million won with 15% interest per annum from the day following the delivery of a copy of the payment order of this case to the day of complete payment (the plaintiff claimed payment of 20 million won and penalty of 20 million won and penalty of 20 million won and penalty of 40 million won due to the cancellation of the contract due to the reasons attributable to the defendant, but the court of first instance changed the cause of the claim by the claim for restitution which was caused by the cancellation or cancellation of the contract and withdraws the part demanding payment of 20 million won for penalty).

1. Basic facts

A. On August 10, 2017, the Plaintiff entered into a real estate sales contract with the Defendant to purchase land owned by the Defendant (hereinafter “instant sales contract”). Some of the terms of the instant sales contract are as follows.

1. Table 1. In the case where a lessor or lessee fails to perform any of the terms and conditions of this contract, the other party may demand in writing the person who has failed to perform the contract and cancel the contract. The other party may claim in writing compensation for damages arising from the cancellation of the contract, and the other party may claim compensation for damages based on the down payment, unless otherwise agreed upon. * The removal of the building at present shall be made by the seller at the expiration of the period of removal.

B. On August 14, 2017, the Plaintiff paid KRW 20 million to the Defendant a down payment under the instant sales contract.

[Ground of recognition] Unsatisfy, entry of Gap evidence 2 to 4, purport of whole pleadings

2. Summary of the plaintiff's assertion

A. Before entering into the instant sales contract, Nonparty 1 explained to the Plaintiff that “The instant building is closed on the ground of land No. 1 (hereinafter “the instant building”). The Defendant’s husband explained to the Plaintiff that “the instant building is owned by the Defendant and removed it by the remainder by the payment date of the remainder,” while the instant building is owned by Nonparty 2 and the front part of the road is not included in 40 square meters.” However, in fact, the lower part of the instant building is 80 square meters in front of the instant building site, and the said part of the road is included in the land No. 1. 40 square meters in that part of the road (the instant building is the actual boundary of the road No. 1). However, the Defendant explained to the Plaintiff that “the instant building is owned by the Defendant and its remainder can be removed by the payment date of the remainder.” In fact, it is difficult for Nonparty 2-2 to remove it immediately.

B. In the first place, the Plaintiff, as the subject matter of the instant sales contract is not a seller’s explanation, did not make the land available for the first place, but made an error as to the remainder of the land excluding the 40 square meters of the above part of the road (hereinafter “second-party land”). ② Since the owner of the instant building is the Defendant, the instant sales contract was revoked in accordance with the Plaintiff’s declaration of revocation, and the Defendant is obliged to pay the down payment amount of KRW 20 million and damages for delay.

C. Preliminaryly, the Defendant: (a) deceiving the Plaintiff as if the subject matter of the instant sales contract was the land No. 1; (b) deceiving the Plaintiff as if the subject matter of the instant sales contract was the land No. 2; and (c) concluded the instant sales contract by deceiving the Plaintiff as being easy to remove because the instant building was owned by the Defendant; and (b) the instant sales contract was revoked in accordance with the Plaintiff’s declaration of revocation; and (c) the Defendant is obliged

D. Preliminaryly, the Defendant’s side failed to fulfill the obligation of the instant sales contract (the obligation to transfer the ownership of the land sufficient to enable the Plaintiff to achieve the original purpose of the contract). As such, the Plaintiff is obligated to cancel the instant sales contract on the grounds of nonperformance, and the Defendant is obliged to pay the down payment of KRW 20 million and the delay damages therefrom, with the restitution of the original status.

3. Determination

A. Determination on the argument for revocation of mistake

(1) Whether the contents of a juristic act are erroneous

If it is apparent that it would not be possible to achieve the purpose of the contract if it was known that there was an error in the current status and boundary of the land before the contract was entered into, it constitutes an error in the important part of the contract and thus it can be revoked (see Supreme Court Decisions 67Da2160, Mar. 26, 1968; 74Da54, Apr. 23, 1974, etc.).

The following facts and circumstances, which can be acknowledged by comprehensively considering the overall purport of pleadings as to the testimony of Non-Party 3 of the witness of the first instance trial, i.e., ① at the time of the instant sales contract, the Defendant was aware that the boundary of the land of Non-Party 1 was not included in the part front of the road field, unlike the actual boundary, as to the boundary of the land of Non-Party 1 at the time of the instant sales contract (the third pleading protocol of the first instance court). ② Accordingly, the Defendant did not explain the boundary of the land of Non-Party 1 at the time of the instant sales contract, and the Plaintiff appears to have concluded the instant sales contract by recognizing the boundary of the land as the boundary of the land of Non-Party 2 after the instant sales contract was concluded (the Plaintiff appears to have conducted flat and first works based on the boundary of the land of the second instance after the instant sales contract). ③ The size of the land of Non-Party 1 is approximately approximately 324 square meters (1,074 square meters). The Plaintiff deemed to be included in the entire area of the land of this case.

(2) Whether the plaintiff was grossly negligent

The defendant, even if the plaintiff entered into the sales contract of this case due to the mistake, is proved to be grossly negligent.

In light of the fact that (i) a purchaser cannot be deemed to have a duty of care to verify in advance whether the subject matter of sale is accurately consistent with that in the cadastral map by means of comparison, such as surveying or comparison with the cadastral map, unless there are special circumstances in land sale (see Supreme Court Decision 84Meu2344, Nov. 12, 1985); (ii) the Defendant, the owner of the land, was aware of the error in the boundary of the land No. 1; and (iii) there was an error in the Plaintiff’s mistake due to the error on the part of the Defendant, it is difficult to deem that the Plaintiff was gross negligence in the mistake of land boundary. Accordingly, the Defendant’s defense is without merit.

B. Cancellation of the instant sales contract

Ultimately, the instant sales contract constitutes a juristic act that may be revoked pursuant to Article 109(1) of the Civil Act, and the fact that the statement of grounds of appeal containing the Plaintiff’s declaration of intent to revoke was delivered to the Defendant on March 12, 2019 is apparent in the record. As such, the instant sales contract was lawfully revoked (Inasmuch as the Plaintiff’s primary assertion was accepted for revocation due to mistake, it shall not be separately determined as to the conjunctive assertion).

(c) Scope of reinstatement;

Therefore, the Defendant is obligated to refund to the Plaintiff the already paid down payment of KRW 20 million and interest thereon and damages for delay. Meanwhile, with respect to interest and damages for delay, the Plaintiff seeks payment of damages for delay calculated at the rate of 15% per annum from the day following the delivery of a copy of the instant payment order.

In the event that a sales contract was cancelled for the first time, Article 748 of the Civil Act applies to the seller’s obligation to return the down payment, due to its nature, as to the scope of return as unjust enrichment, so a bona fide beneficiary is liable to return the interest received to the extent that there exists any benefit, and a malicious beneficiary is liable to bear the burden of proof as to the fact that it is a bad faith. Meanwhile, Article 749(2) of the Civil Act provides that “When even a bona fide beneficiary has lost, he/she shall be deemed as the beneficiary in bad faith from the time he/she instituted the lawsuit.” In this context, “when a copy of the complaint has been served to the defendant” refers to “when a copy of the complaint has been served to the defendant.” Accordingly, the defendant who is against this case should return interest as a bad faith beneficiary from January 30, 2018,

Furthermore, the claim for return of unjust enrichment reaches the due date only when the obligor receives a claim for performance with no fixed due date. As such, the Defendant is obligated to pay the Plaintiff damages for delay from March 13, 2019, clearly stating that it is the day following the delivery date of the application for change of the purport and cause of the appeal of this case for which the Plaintiff claims performance.

Ultimately, the Defendant is obligated to pay interest and delay damages calculated by the rate of 5% per annum as stipulated by the Civil Act from January 31, 2018, which is the day following the delivery day of the application for the instant payment order, sought by the Plaintiff for restitution to the Plaintiff, until October 31, 2019, which is the day of the final judgment of the court of first instance, and 15% per annum as stipulated by the Act on Special Cases concerning the Promotion, etc. of Legal Proceedings, from the next day to the day of full payment, to the day of the delivery of the application for the instant payment order.

4. Conclusion

Thus, the plaintiff's claim shall be accepted within the scope of the above recognition, and the remaining claims shall be dismissed as it is without merit. Since the judgment of the court of first instance is unfair by different conclusions, the judgment of the court of first instance shall be modified as above, and it is so decided as per Disposition.

[Attachment]

Judges Kim Yong-deok (Presiding Judge)

1) The Plaintiff’s change of the cause of the claim from the trial to the partial winning of the claim shall be determined as above.