Whether there is a special limitation on the exercise period of the right to conclude sales reservation and the exercise period of the right to conclude reservation as agreed between the parties (negative)

The right to trade as stipulated in Article 564 of the Civil Act shall have the effect of trade by declaring the intention of completion of the reservation to the other party to trade in one-way promise, that is, the right to complete the trade reservation shall exercise the right within a certain period if the parties have agreed to exercise the right within such period, and within 10 years from the time the reservation was made if no agreement has been reached, and the right to complete the reservation shall expire upon the lapse of the exclusion period. Meanwhile, there is no special limitation on the exercise period of the right to complete the reservation as agreed between the parties.

Article 564 of the Civil Act

Supreme Court Decision 91Da44766, 44773 Decided July 28, 1992 (Gong1992, 2552) Supreme Court Decision 2000Da26425 Decided January 10, 2003 (Gong2003Sang, 561)

Plaintiff

Defendant

Changwon District Court Decision 2016Na2738 decided September 7, 2016

The judgment of the court below is reversed, and the case is remanded to Changwon District Court.

The grounds of appeal are examined.

1. The right to sell and purchase under Article 564(a) of the Civil Act, namely, the right to conclude a pre-sale agreement, where the other party to the pre-sale expresses his/her intention of completion of the pre-sale agreement and the right to conclude the pre-sale agreement, is a kind of right to create a pre-sale agreement between the parties, within such period, and where there is no such agreement, within 10 years from the time the pre-sale was made; and the right to complete the pre-sale is extinguished upon the lapse of the exclusion period (see, e.g., Supreme Court Decisions 91Da4476, Jul. 28, 1992; 200Da26425, Jan. 10, 2003). Meanwhile, there is no special limitation on the period for exercising the right to complete the pre-sale agreement between the parties.

2. Based on its adopted evidence, the lower court acknowledged the fact that the Plaintiff completed the provisional registration of this case made on April 30, 2002 to the Defendant on the ground of a unilateral promise to sell and purchase the instant real estate on April 26, 2002.

Furthermore, the lower court determined that: (a) even though the Plaintiff and the Defendant agreed to exercise the right to conclude a reservation until April 25, 2032, the Defendant’s right to conclude a reservation does not exist for the period exceeding ten years agreed upon by the Plaintiff and the Defendant; and (b) the Defendant’s right to conclude a reservation ceased to exist for a ten-year period from April 26, 2002 to April 25, 2012, when ten years have elapsed since April 26, 2002; and (c) accordingly, the Defendant was liable to implement the procedure to register cancellation of the provisional registration of this case with respect

3. However, in light of the legal principles as seen earlier, since the Plaintiff and the Defendant agreed to exercise the exercise period of the right to conclude a reservation until April 25, 2032, the right to conclude a reservation should expire after April 25, 2032 agreed, the right to conclude a reservation should be extinguished due to the lapse of the exclusion period. Thus, the provisional registration of this case cannot be deemed null and void on the grounds of the termination of the right to conclude a reservation.

Nevertheless, the lower court determined otherwise on the grounds indicated in its reasoning. In so doing, the lower court erred by misapprehending the legal doctrine on the exclusion period in cases where an agreement on the exercise period of the right to conclude a reservation exists, thereby adversely affecting the conclusion of the judgment.

Supreme Court Decision 200Da26425 Decided January 10, 2003 cited by the court below is related to the interruption of the exclusion period in the event that there is no agreement on the exercise period of the right to conclude purchase and sale reservation, and therefore, it is inappropriate to use the case differently.

4. Therefore, the lower judgment is reversed, and the case is remanded to the lower court for further proceedings consistent with this Opinion. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Park Poe-dae (Presiding Justice)