The administrator of the rehabilitation industry corporation, a lawsuit taken over by the Pung Forest Industry corporation (Law Firm Rate, Attorneys Kim Tae-tae et al., Counsel for the plaintiff-appellant)

Zone Two Housing Reconstruction and Improvement Project Association (Law Firm Apatum, Attorney Kim Apatum, Counsel for plaintiff-appellant)

September 13, 2012

Seoul Western District Court Decision 2010Gahap7355 Decided June 2, 2011

1.The judgment of the first instance, including any claims added in the trial, shall be modified as follows:

A. The defendant shall pay to the plaintiff the amount of KRW 3,548,963,821 and the amount of KRW 928,200,476 from December 5, 2010, KRW 2,336,730,00 per annum from December 23, 2010 to June 2, 201, and KRW 20% per annum from the next day to the day of full payment.

B. The plaintiff's primary claim for damages is dismissed.

C. Based on the ancillary claim as to the claim for return of unjust enrichment added at the trial, the Defendant shall pay to the Plaintiff 1,456,789,018 won and 1,103,027,903 won among them, 5% per annum from December 5, 2010 to October 25, 2012, and 20% per annum from the next day to the date of full payment.

D. The plaintiff's remaining conjunctive claims are dismissed.

2. (a) On the basis of an application for the return of provisional payments, the Plaintiff shall pay to the Defendant the amount of KRW 89,434,410 as well as 5% per annum from July 1, 2011 to October 25, 2012, and 20% per annum from the next day to the day of full payment.

B. The defendant's remaining provisional payment claim is dismissed.

3. The total cost of the lawsuit (including the cost of filing an application for the return of provisional payments) shall be 10 minutes, and the remainder shall be borne by the plaintiff, and the defendant, respectively.

4.Paragraphs 1(a), (c) and 2(a) may be provisionally executed.

1. Purport of claim

The defendant shall pay to the plaintiff 16,147,015,819 won and 14,964,930,476 won among them from December 5, 2010 to the service date of a copy of the application for modification of the purport of the claim of this case and the cause of the claim of this case, and 6% per annum from the next day to the day of full payment (the plaintiff added the claim for return of unjust enrichment as a preliminary claim for the above claim in the first instance where the claim for return of loan and the damages due to non-performance are combined).

2. Purport of appeal

Plaintiff: To modify the judgment of the first instance court as stated in the purport of the claim.

Of the judgment of the court of first instance, the part against the defendant ordering payment exceeding KRW 3,548,963,821 out of KRW 5,076,505,073, which the defendant should pay to the plaintiff is revoked, and the plaintiff's claim as to that part is dismissed.

3. Purport of request for the return of provisional payments

The plaintiff shall pay to the defendant the amount of KRW 1,527,541,252 as well as the amount calculated by applying the rate of 6% per annum from June 29, 201 to the date the judgment of the court of a trial is rendered, and 20% per annum from the next day to the date of full payment.

1. Basic facts

A. The Defendant is a housing reconstruction and improvement project association established on May 27, 2003 with the purpose of implementing a housing reconstruction project with the contents of removing old and inferior housing units, etc. on the site of the removal of old and inferior housing units in Mapo-gu Seoul Metropolitan Government (number omitted) and constructing new apartment units, etc. on the site of the removal.

B. On October 28, 200, prior to obtaining authorization to establish an association, the Defendant held an inaugural general meeting (hereinafter “instant inaugural general meeting”) and passed a resolution to select a scenic industry corporation (hereinafter “scenic industry”) as a contractor. On November 15, 2000, the Defendant entered into a contract for the construction of a project of a scenic industry and a housing reconstruction project of an Abane 2 (a) (hereinafter “instant construction contract”). The main contents of the said construction contract are as follows.

Article 7 (Contract Amount for Construction Works)

① The amount of a construction contract to be paid by the defendant to the scenic industry is as follows:

76,476.612,190,00 167,483,775,900 general soil and sand standards, value-added tax, separate from the total construction cost of the table planning total floor area (won) in the main sentence.

Article 15 (Business Expenses)

(1) A defendant shall operate a business by inserting all of the construction expenses and the required funds, and shall lend the business to the defendant with no interest rate, the lease deposit, design expenses, supervision expenses, registration expenses for preservation, safety diagnosis expenses, traffic impact assessment expenses, measurement expenses, geological survey expenses, appraisal expenses, relocation expenses, mortgage creation and termination expenses, trust registration expenses, value-added tax paid by the cooperative, sale system expenses, removal expenses, association operation expenses, and sale guarantee fees.

(2) Other matters which are not specified in paragraph (1) as essential expenses due to the promotion of projects shall be leased as interest at the request of the defendant after consultation between the defendant and the scenic industry.

(3) The members of the defendant or defendant's association and the public forest industry shall prepare all documents necessary to raise business expenses and implement the following procedures, respectively.

Article 17 (Subsidization of Expenses Incurred in Operating Associations)

The Pung Forest Industry shall lend the Defendant’s prior operation expenses to the Defendant at the request of the Defendant, without interest, and the expenses necessary for the operation of the association from the date of signing the provisional contract to the date of approving the establishment of the association, with interest-free loans of KRW 13 million per month from the date of approving the establishment to the date of three months from the date of signing the provisional contract, and the said amount shall be deducted from the construction cost under Article 7, and the said amount shall be deducted from the construction cost under Article 7, and shall be repaid under Article 38(2) by separately lending KRW 2 million per month from the date of moving-in to the time of liquidation of the association.

Article 18 (Interest-Bearing)

(1) The interest rate on business expenses prescribed in Article 15 (2) shall be the fluctuation rate applied to the general loan interest rate of the Korea Housing and Commercial Bank, and overdue interest rate shall be applied to the linkage rate of overdue loans of the housing

Article 34 (Cancellation and Termination of Contracts)

(1) Where it is found that the scenic industry is unable to perform the contract due to the occurrence of any of the following causes, the defendant shall notify in writing the time limit for performing the contract of 30 days, and where the contract is not performed within such time limit, the defendant may cancel or terminate all or part of this contract, and where the contract is terminated or terminated in whole, the scenic industry shall immediately suspend the relevant construction work and remove all the construction works and the damages incurred thereby shall be compensated by the scenic industry:

1. Where construction work has not been commenced even after the agreed date of commencement without any justifiable reasons;

2. Where it is objectively deemed impossible to complete construction works within a construction period due to any cause attributable to the scenic industry;

3. Where it is objectively determined that the objective of the contract is impossible to be achieved because the scenic industry violates the terms and conditions of the contract.

(2) Where it is objectively deemed impossible to continue to perform a project due to any of the following causes, a scenic industry shall notify in writing the deadline for performing the contract of 30 days, and where the relevant project is not performed within such deadline, it may suspend the project and cancel or terminate all or part of this contract if the project is not performed within such deadline. In such cases, the defendant shall settle without delay all loans borrowed from the scenic industry and construction amount, etc. of completed portion thereof, and the damage to the scenic industry resulting therefrom shall be

1. Where the construction period has been delayed by at least 1/4 due to a cause attributable to the defendant;

2. Where the Defendant fails to perform the instant construction contract without justifiable grounds, or where it is objectively deemed objectively impossible to continue to perform the construction works due to the failure to comply with the agreement prescribed in the contract terms.

3. Where it is difficult or impossible to perform construction works due to the expiration of the period of resettlement prescribed by the winding industry because the complete price is not completed even after the period of resettlement expires

4. Where it is objectively deemed that the defendant is unable to achieve the agreed purpose in violation of the terms and conditions of the contract.

Article 38 (Reimbursement, etc. of Construction Costs)

(1) The method by which the defendant pays construction expenses for the scenic industry shall be paid to the scenic industry by withdrawing the total amount of additional charges for cooperative members and the total amount of general sale proceeds pursuant to Articles 22 and 23 within seven days from the deposit date.

(2) The defendant shall, with respect to the business expenses under Article 15, reimburse the total amount of principal and interest not later than the expiration of the occupancy period provided for in Article 45 to the wind industry, and shall preferentially repay the construction expenses in order of interest-free

C. However, around June 5, 2010, the Defendant notified the Pung Forest Industry that “The instant construction contract shall be terminated in accordance with Article 34 of the instant construction contract,” on the following grounds: (a) although the Defendant requested the Pung Forest Industry to provide loans, etc. several times for the smooth progress of the project from 2008, it did not cooperate therewith; (b) caused delay in the project; and (c) caused significant defects designated as a company subject to the workout program on January 2009.”

D. After that, on September 12, 2010, the Defendant held a general meeting of partners to terminate the construction contract with the scenic industry, and passed a resolution to select a consortium with the Hyundai Industrial Development Co., Ltd. as the contractor.

E. On June 10, 2010, Pung forest industry filed the instant lawsuit. On May 10, 2012, during the appellate trial, the Seoul Central District Court rendered a decision of commencement of rehabilitation procedures by 2012. On May 10, 2012, the Plaintiff was appointed as a custodian, and filed a lawsuit against Pung forest industry.

[Ground of recognition] Facts without dispute, Gap evidence Nos. 1, 2 and 3 of evidence Nos. 2, 292, Eul evidence Nos. 12, 18 and 19, and the purport of the whole pleadings

2. The parties' assertion

A. The plaintiff's assertion

(1) Cancellation of the instant construction contract due to a cause attributable to the defendant

Even after a scenic industry has been designated as a company subject to the workout program, the defendant unilaterally notified the termination of the construction contract of this case and selected a new contractor. Since the plaintiff cancelled the construction contract of this case by serving a duplicate of the application for modification of the purport of this case and the cause of claim on the ground of the defendant's refusal of performance or impossibility of performance, the defendant is obligated to pay to the plaintiff delay damages from December 5, 2010 for KRW 4,447,015,819, and the loan 3,204,930,476, out of the loan and interest loaned to the defendant by the scenic industry due to performance of the duty to restore, and the loan 3,204,930,476, as well as the loan 11,70,000,000,000,000,000 won or more from the trust interest, 200,000,000 won or more from the performance of the construction contract of this case.

d. The execution contract of this case is null and void

Even if the construction contract of this case is null and void, since the loan agreement between the wind industry and the defendant is separate from the construction contract of this case, the defendant shall repay the loan obligation to the plaintiff, and the amount equivalent to the 1,115,855,434 won and the interest accrued thereon, out of the damages equivalent to the trust interest corresponding to the plaintiff's claim against the defendant under the premise that the plaintiff's cancellation of the construction contract of this case, shall be directly disbursed by the defendant, but the wind industry shall be deemed to be the "expenses for the cost of loan and the cost of loan." Thus, the defendant has obtained the profit that is equivalent to the above money, and thus, it shall be returned to the plaintiff as unjust enrichment

B. Defendant’s assertion

(1) The invalidity of the instant construction agreement

A resolution selected at the inaugural general meeting of this case as a contractor was null and void. The execution contract of this case concluded on the basis of the above invalid resolution also becomes null and void. A claim for return of funds loaned by Pung forest industry to the defendant under the execution contract of this case is a claim for return of loans under a commercial loan contract of this case where the due date has not been specified, and the plaintiff submitted an application for modification of the purport of this case and the cause of claim for payment of loans and other business expenses to the defendant, which was incurred before December 16, 2005, from December 16, 2005, five years before December 27, 2005, and cannot be claimed to the defendant after the lapse of five-year commercial extinctive prescription, and only interest-free loans between December 27, 2005 to May 24, 2010 and the loan repayment amounting to KRW 810,000,000 and from March 29, 2006 to KRW 204 and KRW 184.274,274.284.28

D. Cancellation of the instant execution contract due to changes in the circumstances or reasons attributable to the winding industry

Even if the construction contract of this case is valid, ① the wind industry following the conclusion of the construction contract of this case was designated as a company subject to the workout program due to the aggravation of the financial structure on April 17, 2009, which led to the decline in corporate image and reliability. This is a significant change in circumstances that the defendant could not have foreseen at the time of execution of the construction contract of this case. ② The wind industry refuses to provide the defendant with project costs, attorney's fees, general meeting holding expenses, etc. necessary to implement the procedure for designation of the rearrangement zone, so it is delayed to proceed with the improvement project as well as to allow 78 members of the area additionally incorporated into the defendant's business area to select the contractor. Thus, the defendant lawfully rescinded the construction contract of this case by notification of June 5, 2010 on the ground of change in circumstances or nonperformance of the wind industry. Accordingly, it is unreasonable for the plaintiff to claim compensation for damages against the defendant except for the portion seeking the return of the loan as the plaintiff's claim for restitution to the defendant.

【Contributory Negligence

Even if the Defendant’s rescission on June 5, 2010 regarding the instant execution contract is not lawful and is responsible for the Defendant, and the instant execution contract was rescinded by the Plaintiff, it should be reduced by more than 50% of the amount of damages by taking into account such factors as violation of the duty to prevent damages, designation of a company subject to the workout program, violation of the duty to lend business expenses, etc.

3. Determination

A. Determination as to the validity of the instant construction contract

The general meeting or the board of directors, etc. of a corporation shall prepare the minutes, and the minutes shall contain the proceedings, guidelines, results, etc., and shall be proved only by the minutes, barring special circumstances, such as whether the minutes were unable to be prepared or lost (see Supreme Court Decision 2008Du5568, Apr. 29, 2010).

According to the evidence No. 292, No. 2 and No. 34, the defendant's appearance at the general meeting of 5, 200. The defendant's appearance at the general meeting of 5, the number of the members present at the general meeting is 5, and the number of the members present at the general meeting is 5, and the number of the members present at the general meeting is 14:0 and the number of the members present at the meeting is 5, and the number of the members present at the general meeting of 5, the number of the members present at the general meeting of 19, and the number of the members present at the 19, the number of the members present at the general meeting of 5, the number of the members present at the general meeting of 1, the number of those members present at the 19, the number of members present at the general meeting of 1, the number of members present at the 5, the number of members present at the general meeting of 1, the number of members present at the 1,506, the total number of the members present at the voting.

B. Determination as to a loan claim, a claim for damages (principal claim) and a claim for restitution of unjust enrichment (preliminary claim)

(i)Determination on requests for loans;

From November 16, 200 to May 24, 2010, Pung forest industry loaned KRW 2,356,730,000 in total to the Defendant as stated in the instant construction contract, and KRW 939,200,476 in total as stated in the attached Table 1, and KRW 939,20,476 in advance as stated in the attached Table 2, and among them, the Defendant lent the Pung forest industry the amount of KRW 20,00,000 in [Attachment 1] No. 3] on September 23, 200, and KRW 22,000,000 in [Attachment 2] on November 25, 2005, and KRW 11,000 among interest-free loans amounting to KRW 10,000,000,000 in [Attachment 1] on the grounds that each of the parties’ respective repayment of operating expenses falls under the number 10 to 1705 (including 105).7).1).

However, according to the above facts, each of the above loans is leased by Pung industry in accordance with the construction contract of this case so that the defendant can use it for the purpose of the reconstruction project promotion cost. The above loan contract for consumption aims to achieve the smooth purpose of the construction contract of this case and is incidental to the construction contract of this case. If Pung industry becomes no longer possible because the construction contract of this case becomes null and void, the above loan contract based on the construction contract of this case cannot be affected by it, and the above loan contract of this case which is based on the construction contract of this case cannot be affected by it. Paragraph 2 of Article 38 of the construction contract of this case provides that the business expenses shall be repaid in order of interest without interest and pay interest prior to the construction cost among the additional charges of the union members, general sales revenue, etc.

Therefore, the defendant's total amount of loan 3,548,963,821 won (=2,36,730,000 won out of loan 2,356,730,000 - repayment 20,000) + loans remaining interest 928,200,476 won (i.e., 939,200,476 won repaid - 11,000,000 won) + The defendant's obligation to pay 20% of the total amount of loan 5% interest per annum from the day following each payment date to December 4, 2010 as stated in attached Form 2 to the above loan 20% interest rate per annum under the Commercial Act, and the defendant's obligation to pay 20% of the total interest 6% per annum from the day following the above loan 20% interest rate per annum under the Commercial Act to the defendant's claim for reimbursement of 20% interest per annum 360% of the loan 20% interest per annum of this case.

In regard to this, the Defendant considers that the statute of limitations for a loan obligation to the scenic industry runs from each lease date, and thus, as described in Paragraph (b) of the above 2.B., it is reasonable to view that the statute of limitations runs from the time of establishment of the pertinent claim, even if it was in principle unaware of the existence or occurrence of rights. However, even if internal legal relations of an organization, such as the right to claim the return of unjust enrichment by a third party arising from the invalidation or absence of a resolution inside a clan or a juristic person, are involved in the situation where it is objectively difficult for the claimant to objectively understand the existence of rights, and even if the claimant did not know of the existence of rights without negligence, deeming that the statute of limitations run immediately from the time of establishment of the right does not accord with the definition and equity, and therefore, it is reasonable to view that the statute of limitations run from the time when the Defendant knew or knew of the existence or absence of the internal resolution within the said organization’s claim to the loan industry by outside (see, e.g., Supreme Court Decision 96Da371637, supra.).

【Judgment on the Claim for Damages】

The plaintiff asserts that the interest that would have been gained by the Pung Forest industry would have been 11,70,000,000 won if the execution contract of this case was implemented, and sought compensation for the performance interest. The plaintiff asserts that the Pung Forest industry would have been able to obtain by the execution contract of this case, and selectively sought compensation for the trust interest of KRW 2,184,200,963 that the Pung Forest industry would have been implementing the execution contract of this case. Thus, the plaintiff's claim for compensation for damages under the premise that the execution contract of this case was rescinded by the plaintiff due to the defendant's fault, or as seen above, it cannot be said that the execution contract of this case was a contract which could not have been effective from the beginning due to the invalidation of the decision to select the contractor of this case, and therefore

【Judgment on the Claim for Return of Unjust Enrichment

The term “non-loan costs” against the Defendant claiming a return of unjust enrichment refers to expenses disbursed for multiple purposes, such as smooth cooperation with the Defendant and smooth progress of a reconstruction project, which are expenses of a nature that will be compensated by profits derived from the implementation of a reconstruction project by the scenic industry. The scenic industry is different from the interest and interest accrued prior to the point of view that it neither is liable for payment under the instant construction contract nor is it expected to be returned from the Defendant. However, even though the nature of the “non-lease costs” disbursed by the scenic industry is the same as above, as the construction contract of this case was initially invalidated, the scenic industry would have lost the opportunity for the Defendant to obtain profits. If the expenses incurred in a reconstruction project were to be incurred by the Defendant due to the “non-loan costs” of the scenic industry, it would be reasonable to return the unjust enrichment to the industry as unjust enrichment.

With respect to the scope of return of unjust enrichment, according to the statements in the health account statement, Gap, 149, 152, 154 through 180, 182 through 185, 187 through 217, 219, 221, 223 through 248, 250 through 256, 258 through 264, 266 through 284 (including the number of serial numbers), the winding industry is recognized as having disbursed the total of KRW 1,103,027,90 as shown in the attached Table 3, with the interest calculated at the annual interest rate of 5% as stipulated in the Civil Act (attached Form 35,761, 115 won) as to the profits received by the defendant.

However, the Plaintiff alleged that the Pung Forest Industry spent the above KRW 1,550,369,830 exceeding KRW 1,103,027,90,000. However, the evidence submitted by the Plaintiff alone is insufficient to recognize that the amount exceeding the above recognized amount was spent as an essential expense for the Defendant’s reconstruction project. Therefore, the part seeking payment of the remaining amount exceeding the above recognized amount is groundless.

Of the above 1,103,027,903 won, the Defendant asserts that the wind industry entered into a contract with the service company with the permission of the company without the involvement of the Defendant and that it is in violation of Article 18 of the Defendant’s articles of incorporation, which stipulates that the wind industry is subject to the resolution of the general meeting of the association members with respect to the contract, etc. to be borne by the union members, and that the wind industry is not unrelated to the Defendant. However, according to each of the above evidences, the wind industry entered into an administrative service contract with the Defendant for the purpose of implementing the reconstruction project, such as the general meeting of shareholders, trust registration, transfer, etc., union affairs, union members, approval of the project plan, general sale approval, etc., and other items are the necessary expenses for the Defendant’s reconstruction project, and most of them are paid at the Defendant’s request. The Defendant’s assertion that there was no obstacle to the above conclusion that there was no resolution of the general meeting of the Defendant on the expenses paid by the wind industry for the Defendant.

Therefore, the Defendant is obligated to pay to the Plaintiff the amount of KRW 1,456,789,018 (=1,103,027,903 + interest 353,761,115 + interest 353,027,90) and the amount of KRW 1,103,027,90 from December 5, 2010 to October 25, 2012, which is the date when the judgment of the court is rendered by the lower court, to dispute the existence and scope of the Defendant’s duty of performance, 5% per annum under the Civil Act and 20% per annum under the Act on Special Cases Concerning the Promotion, etc. of Legal Proceedings from the following day to the date of full payment.

C. Sub-committee

Therefore, the Defendant is obligated to pay 5,005,752,839 won in total to the Plaintiff (i.e., KRW 3,548,963,821 + 1,456,789,018 won in total) and 928,20,476 won in total with interest-free loans from December 5, 2010 to KRW 2,336,730,00 in total with interest-free loans, 6% in total with interest under the Commercial Act from December 23, 2010 to June 2, 2011; and 20% in total with interest-free loans from the following day to June 2, 2011 to the date of full payment; 1,03,027,903 won per annum in total with interest-free loans from each of the following day to December 25, 2010 to the date of full payment; and 20% in total with interest-free loans from each of the Civil Act.

4. Conclusion

A. As to the merits

Therefore, the plaintiff's claim of this case is justified within the above recognition scope and the remaining claims shall be dismissed without merit. As such, since the part accepting a claim for damages among the judgment of the court of first instance is unfair, it shall be accepted by the defendant's appeal and the remainder of the claim for damages shall be dismissed, and the plaintiff shall accept the above part of the claim for return of unjust enrichment added in the court of first instance, and the decision of the court of first instance shall be modified to the purport that the plaintiff shall accept the above part

B. As to the application for the return of provisional payment

As seen earlier, since the judgment of the court of first instance was partially changed from the trial to the 3.0 judgment, the sentence of provisional execution was partially invalidated. According to the defendant's statement 1, 2, and 3 as to June 1, 2012, the remaining KRW 3,601, 75,137, and 1,6362, 360, 470, 206, 360, 360, 275, 367, 206, 47, 205, 206, 360, 47, 205, 205, 206, 360, 47, 205, 206, 360, 367, 206, 367, 205, 206, 367, 206, 367, 206, 367, 207, 363

[Attachment]

Judges Shin Chang-chul(Presiding Judge)

1) In order for a resolution to be valid by the affirmative votes of 261 members with respect to the instant agenda, the number of members present at the time of the resolution shall be 521. It is difficult to deem that the number of members present at the instant agenda was 58 or less between the instant agenda and subparagraph 1.

2) There is no dispute as to the validity of a loan contract for consumption between the wind industry and the Defendant even if the execution contract of this case is null and void (see, e.g., the Reasons for Appeal dated October 13, 201 and the briefs dated February 24, 2012).