Korea Forest Shipping Co., Ltd. (Law Firm LLC, Attorneys Park Gi-sung et al., Counsel for the defendant-appellant)

The chief of the Incheon Coast Guard station (title before the change on October 19, 2017: the chief of the Incheon Coast Guard station) (Law Firm Sejong, Attorney Kim Chang-joon, Counsel for the defendant-appellant)

April 4, 2019

Incheon District Court Decision 2017Guhap5194 Decided August 16, 2018

1. The defendant's appeal is dismissed.

2. The plaintiff's primary claim added by this court is dismissed.

3. The plaintiff's conjunctive claim shall be dismissed by the court.

4. The costs of the lawsuit shall be borne by the defendant after the appeal.

1. Purport of claim

A. On April 12, 2017, the Defendant’s disposition of modifying the license to engage in the ferry business to the Sejong Shipping Co., Ltd. (hereinafter “SPS”) shall be revoked.

B. On September 3, 2018, the Defendant confirms that the change of the license to engage in the ferry business for Sejong Shipping on September 3, 2018 is null and void. Preliminaryly, the Defendant’s change of the license to engage in the ferry business for Sejong Shipping on September 3, 2018 (the Plaintiff added this part of the claim to this Court).

2. Purport of appeal

The judgment of the first instance is revoked. The plaintiff's claim is dismissed.

1. Details of the disposition;

The reasoning for this Court’s explanation is as follows: (a) the pertinent part of the judgment of the first instance is the same as the corresponding part of the judgment (from 5 to 39 pages) except where a part is cited or added as follows; and (b) thus, it is cited in accordance with Article 8(2) of the Administrative Litigation Act and the main text of Article 420 of the Civil Procedure Act.

○○ The 2nd sentence of the first instance judgment, consisting of a 1 to 3th sentence below, shall be followed as follows.

On April 6, 2017, as of February 1, 2017, the age of the vessel of the ▽▽▽▽△-gu was changed to the Defendant, on April 6, 2017, 2017, on which April 2017, the Defendant applied for the change of the license to engage in the ferry business, replacing the instant vessel as the unit of / tangible (713 tons, 500 passengers, and 4 crew members; hereinafter “instant vessel”). On April 12, 2017, the Defendant, on April 12, 2017, determined the starting date of operation of the instant vessel as 00:00 on April 12, 2017, approved the change of the license (hereinafter “the change of license to engage in the first ferry business”).

○ The following contents shall be added between 3 and 4 of the judgment of the first instance.

“Afterward, the Defendant approved on September 3, 2018, the change of the license to engage in the ferry business with the content that the number of the instant vessels from 504 passengers (passenger 495, crew 8/1) to 393 passengers (passenger 384, crew 8, and temporary passengers 1) was reduced (hereinafter “the change of license to engage in the second ferry business”).”

○ The three-dimensional nine-dimensional parts of the judgment of the court of first instance shall be raised as follows.

"In the absence of dispute", Gap evidence Nos. 1, 4, Eul evidence Nos. 4, 5, and 14 (including each number, if any; hereinafter the same shall apply) and the purport of the whole pleadings"

2. Relevant statutes;

Attached Form "Related Acts and subordinate statutes" shall be as stated.

3. Determination as to the claim for revocation of the license change for the primary ferry business

A. Judgment on the defendant's main defense of safety

1) The defendant's main defense of safety

(A)Standing to sue

Since Sejong Shipping already acquired the Plaintiff’s license for the ferry business before obtaining the Plaintiff’s license for the passenger transport business, the Plaintiff has a legitimate right to freely change the license for the said ferry business. Since no legal interest was infringed due to the change of the license for the first ferry business, the Plaintiff has no standing to seek revocation of the license for the first ferry business.

In addition, the Plaintiff, by unlawful means, constructed a ship with a loan that was selected as an end user of the 2nd maritime passenger transport business and supported by the Ministry of Oceans and Fisheries, and entered the ship in the column of “the details of the ship securing and operating in a legitimate way” of the business plan to obtain a license for maritime passenger transport business concerning the instant sea route. Therefore, the Plaintiff’s license for maritime passenger transport business should be revoked as it constitutes “the case of obtaining a license by improper means” as stipulated in Article 19(2)1 of the Marine Transportation Act. If the license for maritime passenger transport business is revoked, the Plaintiff has no standing to seek revocation of the license for the first passenger transport business

B) The filing period

With respect to the instant sea route, the Plaintiff is identical to Sejong Shipping and the route and mooring of a business operator licensed for regular coastal passenger transportation services under the Marine Transport Act, and the Plaintiff was aware that the Plaintiff, as a marine passenger transportation business operator, had to obtain a license from the competent authority when he/she changes the license for a ferry business, such as replacing a vessel, and thus, it is reasonable to deem that the Plaintiff was aware of the existence of the change in the license for the primary passenger transportation business on April 12, 2017 when the operation of the instant vessel was commenced. Accordingly, this part of the lawsuit is unlawful as it was filed after the lapse of 90 days from the date

C) Benefits of lawsuits

Since the license of the first ferry business was changed to the license of the second ferry business, which is a new disposition, and its effect has ceased to exist, this part of the lawsuit seeking the cancellation of the already terminated disposition is unlawful as there is no benefit of lawsuit.

2) Determination

(A)Standing to sue

According to the above facts, the plaintiff's above marine passenger transport services and the instant ferry business of Sejong Shipping are mainly subject to transport of passengers and vehicles on the same sea route, and most of their transport demands overlap, and the plaintiff's profit change is anticipated due to the change in the contents of the license for the instant ferry business of Sejong Shipping. Therefore, it is reasonable to view that the plaintiff and Sejong Shipping are in the relationship of light business operators. Accordingly, there is a legal interest to seek revocation of the license for the first ferry business.

Meanwhile, according to the evidence No. 12 of the business plan submitted by the Plaintiff in relation to the maritime passenger transport service for the instant sea route, it is recognized that the “detailed description of the vessel for securing and operating vessels” of the business plan submitted by the Plaintiff was stated as “the 2014 Coastal Vessel Modernizationed by the Ministry of Maritime Affairs and Fisheries as the actual user of the relevant modern vehicular line for the promotion of the 2014 Coastal Vessel Modernization and the maintenance of the relevant modern vehicular line, and construction of vessels by the new vessel.” However, even according to the Defendant’s assertion, the Plaintiff appears to have been selected as the actual user of the marine passenger transport service for the modernization of the vessel according to the above stated contents, and there is no evidence to support that the Plaintiff

The defendant's main defense to this part is without merit.

B) The filing period

According to the statements in the evidence Nos. 5, 6, 17, and 21, the Plaintiff appears to have known of the operation of the instant vessel around April 12, 2017, in which the operation of the instant vessel was commenced. However, further, it is insufficient to conclude that the Plaintiff, who was not the direct party to the instant disposition, was aware of the fact that the Defendant, from around that time, issued the first disposition to change the license for the first ferry business with the content that the Plaintiff, who was not the direct party to the instant disposition, replaced Sejong Shipping with the instant vessel, from that time to December 14, 2017, was aware of the fact that the Plaintiff was aware of the first disposition to change the license for the second ferry business from December 14, 2017, which was the date of the instant lawsuit. This part of the Defendant’s main defense is without merit.

C) Benefits of lawsuits

Where a subsequent disposition is made with a substantial change in the main part of the prior disposition, the prior disposition shall lose its effect, except in extenuating circumstances. However, the existence of the subsequent disposition does not necessarily lead to the absence of any prior disposition, and where it is merely a minor change in the contents of the prior disposition, the prior disposition shall not be deemed extinguished (see, e.g., Supreme Court Decisions 2010Du20782, 20799, Dec. 13, 2012; 2015Du295, Nov. 19, 2015).

Examining the facts acknowledged in light of the aforementioned legal principles, both the license change of the first ferry business and the license change of the second ferry business are the dispositions related to the second ferry business of the Sejong Shipping. The license change of the second ferry business is merely the adjustment of the business to the extent that the number of the vessels of this case is reduced under the premise of the license change of the first ferry business, and it cannot be deemed a new disposition that actually alters the main part of the former license change of the first ferry business. Therefore, it is reasonable to view that the license change of the first ferry business continues to exist to the extent that it is not modified by the license change of the second ferry business. Therefore, this part of the Defendant’s main defense is without merit, premised on the premise that the license change of the second ferry business becomes extinct by the license change of the second ferry business.

B. The legality of the disposition of changing the license for the 1st ferry business

1) Summary of the Plaintiff’s assertion

A) Under the Excursion Ship and Ferry Business Act (hereinafter “Excursion Ship and Ferry Act”), the scope of license for the ferry business is ① an engine ship with a gross tonnage of at least five tons and with a capacity of less than 13 passengers, ② an engine ship with a gross tonnage of at least five tons, ③ an engine ship with a capacity of at least 13 passengers, with a gross tonnage of at least 5 tons, or an engine ship with a capacity of at least 13 passengers, which is subject to a license for the maritime passenger transport business under the Marine Transport Act. The instant ship is an engine ship with a gross tonnage of at least 5 tons and with a capacity of at least 13 passengers, and can only be used for the maritime passenger transport business, and thus, it cannot be used for the ferry business. Thus, the first change of license for the ferry business under the license for the instant ferry business is unlawful as to a ship that can not be subject to the license.

B) Even if the instant vessel may be subject to the instant license for the instant ferry business, it is apprehended that Sejong Shipping would violate the Plaintiff’s business rights by replacing the instant vessel with the instant vessel according to the disposition of changing the license for the instant ferry business, and thereby engaging in the instant ferry business. Therefore, the instant disposition of changing the license for the instant ferry business is unlawful.

2) Determination

A) Whether the ferry business using the instant vessel is not permitted

Article 3 of the Enforcement Decree of the Excursion Ship/ferry Act provides that a ferry business operator shall obtain a license for a ferry business with a capacity of at least five tons, a vessel with a gross tonnage of at least 13 passengers, and a ferry business with a gross tonnage of at least 2 nautical miles from among those vessels with a gross tonnage of less than five tons, and a ferry business with the business territory of at least 2 nautical miles. Article 18(1)4 proviso of the Excursion Ship/ferry Act and Article 11 of the Enforcement Decree of the Excursion Ship/ferry Act provides that “a vessel with a length of at least 24 meters and a vessel with a gross tonnage of at least 50 tons shall be registered” and Article 22 of the Excursion Ship/ferry Act provides that “a vessel with a gross tonnage of at least 50 passengers shall be reported for every 10 passengers” and “a ferry business operator with a seating capacity of at least 10 additional 10 passengers shall be reported for every 10 passengers”.

In full view of the above provisions, a vessel with a gross tonnage of at least five tons and a vessel with a gross tonnage of less than five tons with a fixed capacity of at least 13 passengers shall obtain a license from the competent administrative agency in order to engage in ferry business. A vessel with a gross tonnage of less than five tons, a vessel with a gross tonnage of less than 13 passengers, or a vessel operated only by oars or sails, with a gross tonnage of at least 13 passengers, shall report to the competent administrative agency in order to engage in ferry business. However, the Plaintiff’s assertion that a vessel with a gross tonnage of at least 5 tons should be used only for maritime passenger transport business, and a vessel with a fixed capacity of at least 13 passengers shall not be deemed to have the competent administrative agency to have the permission to engage in ferry business using such vessel. The Plaintiff’s assertion on the premise that the vessel of this case with a gross tonnage of at least five tons and with a seating capacity of at least

B) Whether a license change disposition for the primary ferry business is likely to infringe on the Plaintiff’s business rights

(1) Relevant legal principles

In full view of the contents and structure of the relevant provisions, such as Article 2 subparag. 2 and Article 3 of the Excursion Ship/ferry Act, Articles 2 and 7(2)1 of the Enforcement Decree of the Excursion Ship/ferry Act, and Article 3(4) of the Enforcement Rule of the Excursion Ship/ferry Act, etc., a ferry business is a type of business designed to meet relatively close distance marine transport demands in a sea area where a passenger ship under the Excursion Ship/ferry Act does not operate. As such, a license is granted on the premise that a passenger ship under the Marine Transport Act does not operate a sea area, and the content and method of the business is not likely to infringe on the goodwill of a maritime passenger transport service provider under the Marine Transport Act.

Therefore, if a ferry business operator licensed to engage in a ferry business in a sea area where a passenger ship under the Marine Transport Act is not operated, and the operation of a passenger ship under the Marine Transport Act was newly commenced while operating his/her business, the passenger ship operation cannot be deemed to have an impact on the validity of the license to engage in a ferry business already assigned due to the operation of the passenger ship. However, a license to engage in a new ferry business cannot be additionally granted for the said sea route. Furthermore, inasmuch as the number of navigations within business hours and the frequency of navigations are not subject to special regulations in principle, approval of a license to engage in an existing ferry business operator is the same as granting an additional license, barring special circumstances, it is reasonable to deem that a license to engage in an existing ferry business is not granted. This new type of ferry business accords with the purport of the Aviation Business Act and subordinate statutes premised on the premise that the content and method of the business of a passenger transport business need not infringe on the maritime passenger transport business operator’s goodwill under the Marine Transport Act (see Supreme Court Decision 2017Du46271, Nov. 23, 20

(2) Specific determination

As seen earlier, the Plaintiff’s new commencement of the operation of a passenger ship with a license for a coastal passenger transport business under the Marine Transport Act on the instant sea route where no passenger ship is operated pursuant to the Marine Transport Act is operated. Accordingly, the Plaintiff is not entitled to a license for a new passenger transport business with respect to the instant sea route. However, in full view of the following circumstances, the Defendant’s change of the license for the primary passenger transport business after the commencement of passenger ship operation pursuant to the Plaintiff’s Marine Transport Act cannot be permitted as it actually infringes the Plaintiff’s business right, which is a maritime passenger transport business entity, as it actually violates the Plaintiff’s business right after the commencement of the instant passenger ship operation pursuant to the said Act, and thus, the first passenger transport business license for the instant sea route is unlawful.

① As a result of the instant disposition to change the license to engage in the primary ferry business, part of the details of the instant vessel was changed (replacement with the instant vessel in ▽▽▽▽▽△). The ▽▽△△ number is “319 gross tonnage, 319 crew vessels, 394 gross tonnage, 394 crew members (passenger 389, crew members5), and 5 lifesaving.” On the other hand, the instant vessel is “713 gross tonnage, 713 gross tonnage, 504 gross tonnage, 504 gross tonnage, 500 crew members (passenger 500, crew members 4), and 6 lifesaving staff members. Following the instant disposition to change the license to engage in the secondary ferry business, only the number of the instant vessel’s specifications has been reduced to 393 passengers (passenger 384, crew members, 8, and 1) but the remainder (excluding the gross tonnage, etc.) of the instant vessel’s specifications remains as is, as seen earlier.

② As such, the gross tonnage (713 tons) of the instant vessel, which was used for the instant ferry business due to the change of the license to engage in the primary ferry business, was at least twice the gross tonnage (319 tons) of the previous TPP 2, which had been used (123.815 tons at the time of the change of the license to engage in the primary ferry business, while the maximum loading capacity of the instant vessel was at the time of the change of the license to engage in the primary ferry business, the maximum loading capacity of the instant vessel was at least 228.489 tons), and the number of navigations within the business hours under the E-ferries Act, and the frequency of navigations between navigations, as a matter of principle, are not subject to any specific regulation regarding the instant vessel’s operation of the instant ferry business by operating the instant vessel using the instant vessel. On the other hand, the Plaintiff’s change of the license to engage in the maritime passenger transport business from 2015 to 2010 to 2015 is likely to violate the Plaintiff’s right to engage in the instant passenger transport business.

③ Meanwhile, on November 15, 2018, the date when the license for the primary ferry business was changed, it is recognized that: (a) a ship inspection certificate was issued to the effect that the maximum load weight of the instant vessel was reduced to 125.223 tons after undergoing a temporary inspection with respect to the instant vessel; (b) however, the details of the instant vessel, which are the license for the instant ferry business, include only the gross tonnage, and does not include the maximum load weight of the instant vessel; and (c) there was no change in the gross tonnage of the instant vessel or the Defendant’s disposition to change the license for the instant vessel on the grounds that the issuance of the ship inspection certificate with the reduced maximum load weight of the instant vessel, it is difficult to view that the change in the license

In addition, the illegality of administrative disposition in the administrative litigation shall be determined on the basis of the relevant laws and regulations at the time of the administrative disposition, and it shall not be affected by the amendment of the relevant laws and regulations or changes in the actual state after the disposition (see, e.g., Supreme Court Decisions 2007Du1811, May 11, 2007; 2016Du32688, Apr. 26, 2017). Thus, the fact that a ship inspection certificate with the contents of reducing the total weight of the largest loading vehicle was issued after the change of the license for the primary ferry business after the aforementioned change of the license for the primary ferry business does not affect the above determination as to the illegality of the change of the license for the primary ferry business. Furthermore, with respect to a ferry to which the Ship Safety Act applies as seen in the instant case, as long as the loading weight meets the standards prescribed in the relevant laws, such as the Ship Safety Act, the small-type ferry business operator, as a ferry business operator, can freely change the loading weight, and thus, there is no concern for the Plaintiff’s business owner.

4. Determination as to the claim on the change of the license for the 2nd ferry business

(a) The primary claim (the claim to confirm the invalidity of the license for the second ferry business);

1) Summary of the Plaintiff’s assertion

The maximum number of persons on board the instant vessel subject to the application of the Ship Safety Act is determined by the Korea Ship Safety Technology Authority delegated by the Minister of Oceans and Fisheries as stipulated in the ship inspection certificate. Thus, the number of persons on board the instant vessel cannot be deemed as the licensed matters for the ferry business, and the Defendant has no authority to newly determine or change the number of persons on board the instant vessel different from that stated in the said ship inspection certificate. Therefore, the disposition to change the license for the second ferry business is issued by an unauthorized person, and its defect

2) Determination

Article 3(1) of the Excursion Pilotage Act provides that “a person who intends to engage in a ferry business shall obtain a license or report from the competent authority in accordance with the size of the ferry or the business area of the ferry. The same shall also apply to any revision to a license or report.” Article 3 of the Enforcement Rule of the Excursion Pilotage Act provides that a person who intends to obtain a license for a ferry business shall submit an application for a license for the business in attached Form 1, stating the details of the ship, etc., along with various evidentiary documents, and submit an application for a change to the license of the business in attached Form 4, accompanied by documents proving the business license and the change thereof, and the competent authority shall only approve the application for change only when the application for change is deemed appropriate under the laws and regulations of the Excursion Pilotage. In light of this, the details of the ship including the gross tonnage

Meanwhile, the Act on the Safety of Ships does not regulate the seating capacity for a ferry subject to the Ship Safety Act, and Article 8 of the Ship Safety Act provides that the Minister of Oceans and Fisheries or the head of an agency delegated by him/her shall designate the maximum number of persons on board and deliver a ship inspection certificate to the ship that passed a regular inspection. Article 10 of the Ship Safety Act provides that a ship inspection certificate shall be issued to the Minister of Maritime Affairs and Fisheries when he/she intends to modify the matters entered in a ship inspection certificate. However, in order to promote the safe sailing of excursion ships/ferries and the sound development of excursion ship/ferry business, a license for a ferry business under the Act on the Safety of Ships and Pilotage allows a business operator meeting certain requirements for a ferry business to engage in a specific business area. On the other hand, the legislative purpose or purpose of the Act is to determine matters necessary for the maintenance of the seaworthiness and safe navigation of ships. Accordingly, even a ship of this case subject to the Ship Safety Act, if an application for the change of the number of persons on board a ship has been made in accordance with the provisions of the Ship Safety Act.

On a different premise, the Plaintiff’s assertion that the license change disposition for the second ferry business is invalid by a person without authority is without merit.

(b) Preliminary claim (the claim for the revocation of the license for the second ferry business or for the alteration thereto);

1) The defendant's main defense of safety

The Plaintiff added the Plaintiff’s claim for revocation of the change of the license for the second ferry business after the lapse of 90 days from the date of the instant lawsuit, in the case of suspending the execution of the disposition to change the license for the second ferry business, which was issued by the Defendant for the suspension of the execution of the disposition to change the license for the second ferry business. As such, this part of the lawsuit is unlawful as it was filed with the lapse of the filing period.

2) Determination

As seen earlier, the license for the second ferry business, which is the preceding disposition, continues to exist within the scope that is not modified by the license modification disposition for the second ferry business, which is the subsequent disposition, and the license modification disposition for the second ferry business, which is the subsequent disposition, is effective within the scope of partly modifying the content of the license modification disposition for the second ferry business, which is the preceding disposition. However, as the Plaintiff filed a lawsuit seeking the revocation of the license modification disposition for the second ferry business, which is the preceding disposition, and subsequently amended the claim seeking the revocation of the license modification disposition for the second ferry business, which is the subsequent disposition, pursuant to the Civil Procedure Act, the determination as to whether the period of filing a lawsuit regarding the revocation of the license modification disposition for the second ferry business, which is the subsequent disposition, should be made at the time of the modification of the claim (see Supreme Court Decision 2010Du20782, 20799, Dec. 1

According to the evidence evidence No. 29, the Plaintiff filed an application with the Incheon District Court 2018 A. 5277 as the respondent on August 21, 2018 for the suspension of validity of the license for the primary ferry business. On September 4, 2018, the Defendant filed a written reply stating that “the Defendant changed the license for the primary ferry business on September 3, 2018 and changed the license for the primary ferry business” as well as the written reply stating that “the license for the primary ferry business was changed.” The Plaintiff’s legal representative was served with the above written reply on the same day. Accordingly, on September 4, 2018, the Plaintiff may be deemed to have filed an application with the court for the revocation of the license for the second ferry business after the lapse of 90 days. Thus, the Plaintiff also filed an application for the revocation of the license for the second ferry business and the second amendment of the license for the second amendment to the purport of the claim for the revocation of the license.

5. Conclusion

Therefore, the plaintiff's claim for revocation of the license change of the 1st ferry business shall be accepted as it is reasonable, and the conclusion is justifiable, and the defendant's appeal is dismissed as it is not reasonable. The plaintiff's main claim added to this court is dismissed as it is without merit, and the conjunctive claim is dismissed as it is illegal and dismissed.

[Attachment]

Judges Noh Tae-tae (Presiding Judge)