2015Du38788 Invalidity of the imposition disposition by burden-bearing entities

Korea Land and Housing Corporation

Law Firm LLC et al., Counsel for the plaintiff-appellant

[Defendant-Appellee] Plaintiff 1 and 3 others

Suwon Market

Law Firm Dasan et al., Counsel for the defendant-appellant

Seoul High Court Decision 2014Nu45514 Decided February 6, 2015

April 8, 2021

The appeal is dismissed.

The costs of appeal are assessed against the defendant.

The grounds of appeal are examined.

1. Summary and key issue of the instant case

A. Case summary

According to the reasoning of the lower judgment, the following circumstances are revealed.

(1) On December 31, 2004, the Minister of Construction and Transportation: (a) designated the Plaintiff as the project implementer the Plaintiff’s main source of ○○○○○○○○ Housing Site Development Project under the Housing Site Development Promotion Act; (b) approved the housing site development plan on January 6, 2006; and (c) approved the implementation plan for the housing site development plan for ○○○○○ Housing Site Development Project on December 20, 2006. Afterwards, the said housing site development plan was converted into the “water-source ○○○○○ Housing Zone” under the former Special Act on the Construction of Bogeumjari Housing, Etc. (amended by Act No. 12251, Jan. 14, 2014).

(2) On April 23, 2008, the Plaintiff requested the Defendant to review the plan for water supply for living. On June 13, 2008, the Defendant responded to the Plaintiff on the following: (a) on the part of June 13, 2008, that “the Plaintiff shall install a drainage outlet in lursan to ensure the smooth water supply of water supply in a water source site development project zone; (b) the Plaintiff shall supply the water pipe connected from the fifth stage pipe of the metropolitan waterworks to the new water unit to the new water unit; and (c) the detailed matters, such as the location and water level plan of the drainage station, the plan to be laid underground as a water pipe, and the future implementation plan, are the main time after consultation with the water supply. In consideration of the period required for the procedure for approval of the project and the revision of the management plan, the Defendant shall promptly install the drainage pipe until the occupancy in the ○○ area.”

(3) The Plaintiff, upon the Defendant’s reply, established a construction implementation plan and consulted with the Defendant, directly installed not only the water supply and drainage facilities within the ○○○○ Bogeumjari Housing District but also the water supply facilities from the existing drainage pipes to the Bogeumjari Housing District.

(4) The Plaintiff obtained approval from the Minister of Construction and Transportation for a national housing construction project in the Suwon○○○ Housing District, and carried out a construction project as a housing developer, concurrently holding the status as a housing site developer. After completion of national rental housing, the Plaintiff filed an application for water supply with respect to individual buildings (a-1, A-2, A-3, A-5, B-6, and B-7 apartment complexes within the Bogeumjari Housing District) after completion of national rental housing.

(5) From March 14, 2011 to September 30, 2011, the Defendant issued the instant disposition imposing the burden on the Plaintiff based on Article 4(1)3 (hereinafter referred to as the “instant Ordinance”) of the Ordinance on the Calculation and Collection of Charges Borne by Water Supply and Waterworks in Suwon-si (hereinafter referred to as the “instant Ordinance”).

B. The key issue of the instant case is (1) whether the instant ordinance provisions are invalid beyond the delegation scope of the Water Supply and Waterworks Installation Act and the Enforcement Decree of the Water Supply and Waterworks Installation Act, where the instant ordinance provisions do not directly cause waterworks construction works because they are within the scope of the existing water supply facilities, and whether the grounds for imposing the burden on the burden are extinguished following the Plaintiff’s consultation with the Defendant when implementing the Bogeumjari Housing District development project.

2. Relevant statutes

(a) Article 3 of the Water Supply and Waterworks Installation Act ("the Water Supply and Waterworks Installation Act") provides the whole of the facilities that provide the natural or processed water using pipes and other structures (as referred to in subparagraph 5), and the water intake and the water storage to provide the natural or processed water.

The term Do water, processed water, water supply - drainage facilities, water supply facilities, and other facilities related to water supply (No. 17), and the term 'water supply facility construction' is defined as the construction, expansion or remodeling of water supply facilities (No. 25).

B. Article 71(1) and (2) of the Water Supply and Waterworks Installation Act provides that a waterworks business operator may require a person who has incurred expenses for the construction works of the waterworks (including a person who has caused new installation or extension, etc. of waterworks by installing facilities using many tap water, such as housing complexes and industrial facilities, etc.), or a person who has operated a business or committed an act that causes damage to waterworks to the relevant waterworks to fully or partially bear expenses incurred in the construction works of the waterworks, maintenance of the waterworks, or prevention from damage to the waterworks, and the standards for calculation of charges, methods for collection, and other necessary matters shall be prescribed by Presidential Decree. Article 65 of the Enforcement Decree of the Water Supply and Waterworks Installation Act provides that the amount borne by the person who has caused the expenses for the construction works of the waterworks shall be the sum of the expenses incurred in the construction or extension of the waterworks (paragraphs 3 and 5), and detailed standards necessary for the calculation of

C. Article 4(1) of the instant Ordinance, upon delegation, provides for the subject of the imposition of burden-bearing charges as follows:

(1) Where a waterworks business operator imposes a construction cost on a person who causes new construction or extension, etc. of waterworks, such as a water intake station, water purification station, drainage station, pressure station, water supply and drainage facility, etc., by installing a facility using a large number of tap water, such as a housing complex, industrial complex, housing site development zone, etc., and causing water demand higher than the water supply capacity of the waterworks business operator (subparagraph 1

(2) In the event that construction of a new water supply and drainage system, such as conduits, etc., is to be carried out in order to supply new tap water to buildings, etc. located outside the water supply zone, the cost required for the construction of the existing water supply system and the cost required for the construction or extension of the relevant water-supply facility are to be borne by the

(3) In cases of supplying tap water to buildings, etc. located within a water supply zone, the construction cost for existing water-supply facilities is imposed on a person who uses tap water (including cases of increasing facility capacity through extension, remodeling, etc. of a building, including cases of increasing facility capacity through extension, remodeling, etc. of a building, but limited to increased capacity)

3. Whether the ordinance provisions of this case deviate from the limitation of delegation scope

A. In cases where a statute delegates a certain matter to a municipal ordinance, determination of whether the municipal ordinance complies with the limits of delegation ought to be made by comprehensively examining the legislative purpose and content of the relevant statutory provision, structure of the provision, and relationship with other provisions, etc. In addition, whether a new legislation was made beyond the bounds of delegation by expanding or reducing the scope of the terms used in the relevant statutory provision beyond the bounds of delegation (see, e.g., Supreme Court Decision 2017Du56193, Aug. 30, 2018).

If it is not clear whether the provisions of an enforcement decree or municipal ordinance conflict with the mother law, the provision should not be declared null and void as a violation of the mother law, if it is possible to interpret that the provisions are consistent with the mother law by comprehensively taking into account other provisions of the parent law, the Enforcement Decree, or municipal ordinance, legislative purport, and history thereof. This legal doctrine is based on the presumption principle that the conflict between the upper and lower rules is to be excluded to the maximum extent possible, as the legal system of the country itself forms a unification. In addition, the norms in a democratic law state are based on the presumption principle that the norms in the democratic law state generally conforms to the upper rules, and in real case where the lower rules are declared null and void as they are in conflict with the upper rules, not only legal confusion and legal instability, but also legal gap and legal protection until a new norm is enacted, so it is also necessary to avoid such harm (see, e.g., Supreme Court Decision 2011Du6264, Jan. 16, 2014).

B. Examining the contents and structure of the relevant Acts and subordinate statutes and the instant ordinances in light of such legal principles, the instant Municipal Ordinance provisions cannot be deemed to have exceeded the delegation scope under the Water Supply and Waterworks Installation Act and the Enforcement Decree of the Water Supply and Waterworks Installation Act. The specific reasons are as follows.

(1) Article 71(1) of the Water Supply and Waterworks Installation Act provides that "the causes of the occurrence of expenses shall be provided for the construction of a water supply system," and does not stipulate that the amount borne by the burden may be imposed only when necessary for the construction of a water supply system, such as the construction and extension of a water supply system. Rather, even where a water supply system, such as a housing complex and industrial facility, has been installed and provided only for the causes of new construction, enlargement, etc. of a water supply system, it is premised on the premise that the amount borne by the burden can be imposed even if a water supply system is not installed or extended immediately.

(2) According to Article 71(3) of the Water Supply and Waterworks Installation Act, the charges borne by the burden of water supply facilities may be used only for expenses incurred in construction, such as new construction, extension, relocation, remodeling, and repair of future water, after collecting the charges from the local government as prescribed by the Municipal Ordinance of the local government and incorporating them into the special accounts for water supply, and only for expenses incurred in construction, such as construction, extension, relocation, remodeling, and repair of the water supply facilities. The provisions of this case can be deemed to have imposed on

(3) The subject matter of the instant ordinance provisions reflects the Standard Ordinance on the Calculation, Collection, etc. of Charges on Charges on Charges on Water Supply and Waterworks by the Ministry of Environment. In addition, the subject matter of the charge is determined by imposing charges on charges borne by the Ministry of Environment under Article 71(1) of the Water Supply and Waterworks Installation Act with similar contents among several local governments

C. Nevertheless, the lower court determined that the instant Municipal Ordinance provision was null and void on the ground that it did not delegate the upper law. In so determining, the lower court erred by misapprehending the legal doctrine on the amount borne by a person responsible for burden, etc. under the Water Supply and Waterworks Installation Act. However, as seen below, insofar as the lower court’s determination that the Plaintiff, who installed waterworks through consultation with the Defendant, is unable to additionally impose the amount borne by a person responsible for burden pursuant to the instant Municipal Ordinance provision

4. Whether the grounds for imposing charges borne by borne entities cease to exist;

A. (1) Article 5(1) of the Framework Act on the Management of Charges provides that “The charges shall be imposed to a minimum extent necessary to achieve the purpose of establishment so that fairness and transparency can be ensured, and no charges shall be imposed twice on one subject of imposition except in extenuating circumstances.”

(2) Article 65(1) of the Enforcement Decree of the Water Supply and Waterworks Installation Act provides, “In order for a waterworks business operator to bear an amount borne by a person who has incurred expenses for the construction of the waterworks pursuant to Article 71(1) of the Act (including a person who has incurred new installation, expansion, etc. of waterworks facilities by installing facilities using a large number of tap water, such as a housing complex and industrial facility), the waterworks business operator shall consult with the person who has incurred expenses for the construction of the waterworks pursuant to Article 71(1) of the Act on the calculation basis and payment method of the amount borne by an amount borne by an amount to be borne by an amount to be borne by an amount under Article 71(2) of the Act. In this case, unless the consultation is held, the waterworks business operator may determine the amount to be borne by the amount to be borne by the amount to be borne by the amount to be borne by the waterworks business operator in consideration of the amount to be borne by the amount to be borne by the waterworks business operator.”

In cases where a cause provider and a causes provider have conducted consultation on the calculation basis and payment method of the amount borne by a person responsible for borne by a water business operator and a cause provider, not only the case where the cause provider has paid the amount borne by the burden of borne by the water business operator following consultation with the water business operator, but also the case where the cause provider has consulted on the direct implementation of construction, extension, etc. of the water-supply facilities at the expense of the cause provider and performed it, it can be deemed that the burden of the cost required for the water-supply works under Article 71(1) of the Water Supply and Waterworks Installation Act has been borne through such consultation. Therefore, barring special circumstances such as where the “amount of actual tap water used by a housing complex or industrial facility, etc. established in the relevant project” significantly exceeds the “amount of estimated usage” under Article 71(1) and (2) of the Water Supply and Waterworks Installation Act, the reason for imposing the burden of borne by a water-supply business operator or the purchaser of a site within the relevant project is extinguished.

B. We examine the aforementioned facts in light of the aforementioned legal principles. The Plaintiff directly performed water construction, such as installation and extension of water facilities, through consultation with the Defendant while implementing the project for creating the Suwon Housing District. This is intended to supply tap water to the national rental housing to be constructed in the said Bogeumjari Housing District. Moreover, there is no circumstance to deem that the “amount of actual tap water used” of the national rental housing constructed in the said Bogeumjari Housing District significantly exceeded the “amount presumed to be the premise for such consultation.” Therefore, it should be deemed that the Plaintiff, while implementing the project for creating the said Bogeumjari Housing District, performed construction, such as new construction and extension of water facilities, upon consultation with the Defendant, cannot impose the burden borne by the Plaintiff under the instant ordinance provisions in relation to the national rental housing constructed in the said Bogeumjari Housing District. In so determining, the lower court did not err by misapprehending the legal doctrine on the requirements for imposing the burden borne by the burden under the Water Supply and Waterworks Installation Act, contrary to what is alleged in the grounds of

5. Whether the defects of the instant disposition are serious and obvious

(1) The lower court determined that the instant disposition was null and void on the ground that the instant Municipal Ordinance provisions, which served as the basis for the instant disposition, were not delegated by the superior statutes, and that, inasmuch as the Plaintiff had already installed all water-supply facilities required to be newly established and expanded as a developer of the Bogeumjari Housing District development project in consultation with the Defendant, as the owner of an individual building act, the amount borne by the Plaintiff under the Water Supply and Waterworks Installation Act cannot be imposed again on the Plaintiff, as the owner of the individual building act.

As seen earlier, it was erroneous for the lower court to have determined that the instant ordinance provision was null and void beyond the scope of delegation by superior laws and regulations. However, even though the Plaintiff’s duty to impose the amount borne by the amount borne by the Plaintiff under the Water Supply and Waterworks Installation Act has ceased to exist due to the Plaintiff’s implementation of construction of new water facilities, such as the extension of water supply facilities, through consultation with the Defendant while implementing the Bogeumjari Housing District development project, the disposition imposing the amount borne by the amount borne by the Plaintiff under the Water Supply and Waterworks Installation Act is an order to the Plaintiff to perform the obligation to pay the amount borne by the amount borne by the burden borne by the Plaintiff, and it is obvious that the defect is serious and apparent (see Supreme Court en banc Decision 2007Du63

6. Conclusion

Therefore, the appeal is dismissed, 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.

Supreme Court Decision 201

Justices Kim Jae-in

Justices Min Il-young in charge

Justices Lee Jae-hwan