[1] Requirements to constitute “persons subject to relocation measures” under Article 78(1) of the former Act on Acquisition of and Compensation for Land, etc. for Public Works Projects

[2] In a case where Eul et al. sold a citizen apartment in accordance with the aging citizen apartment removal project that was conducted by a local government Gap and purchased an apartment unit supplied by Byung Corporation, the case holding that Eul et al. does not constitute a person subject to the relocation measures who bears the basic living facilities installation expenses pursuant to Article 78 (4) of the former Act on the Acquisition of Land, etc. for Public Works and the Compensation therefor, and that part of the apartment sale contract entered into by Byung et al. with Eul et al. which included the basic living facilities installation expenses, among the apartment sale contract entered into by Byung et al. with Eul et al., cannot be deemed null and void

[1] In full view of the contents of Article 2 subparag. 2, Article 4, and the main text of Article 78(1) and the main text of Article 78(4) of the former Act on Acquisition of and Compensation for Land, etc. for Public Works Projects (amended by Act No. 8665 of Oct. 17, 2007; hereinafter “former Land Compensation Act”), in order to qualify as a person subject to relocation measures, a person subject to relocation measures shall lose his/her basis of livelihood by providing residential buildings due to the implementation of a public project falling under any of the subparagraphs of Article 4 of the former Land Compensation Act.

[2] In a case where Gap et al. sells an old civil apartment removal project conducted by Gap local government under the old civil apartment removal project (hereinafter "civil apartment removal project"), and Byung purchased apartment supplied by Byung, the case holding that since Article 39 of the former Disaster Management Act (repealed by Article 2 of the Addenda to the Framework Act on the Management of Disasters and Safety, Act No. 7188 of March 11, 2004) does not constitute a ground provision for the expropriation or use of civil apartment, the civil apartment rearrangement project does not constitute a non-permanent apartment removal project under each subparagraph of Article 4 of the former Act on the Acquisition of Land, etc. for Public Works and the Compensation therefor (amended by Act No. 8665 of October 17, 2007; hereinafter "the former Land Compensation Act") and it does not constitute a non-permanent apartment removal project under each subparagraph of Article 4 of the former Act on the Acquisition of Land, etc. for Public Works and the Compensation Therefor, even if the non-permanent apartment rearrangement project was executed without project approval under the related Acts and subordinate statutes, it does not constitute a non-permanent residential apartment facility construction project.

[1] Articles 2 subparag. 2, 4, and 78(1) and (4) of the former Act on Acquisition of and Compensation for Land, etc. for Public Works (amended by Act No. 8665 of Oct. 17, 2007) / [2] Articles 2 subparag. 2, 4, and 78(1) and (4) of the former Act on Acquisition of and Compensation for Land, etc. for Public Works (amended by Act No. 8665 of Oct. 17, 2007); Article 40(2) of the former Enforcement Decree of the Act on Acquisition of and Compensation for Land, etc. for Public Works (amended by Presidential Decree No. 20722 of Feb. 29, 2008); Article 78(1) and (4) of the former Disaster Management Act (amended by Act No. 718 of Mar. 18, 2004; Article 39(1) of the current Framework Act on the Management of Disasters and Safety)

Plaintiff 1 and six others (Law Firm Wond, Attorneys White-gu et al., Counsel for the plaintiff-appellant)

EP Corporation (Law Firm Barun Law LLC, Attorneys Kim Jung-soo et al., Counsel for the plaintiff-appellant)

Seoul High Court Decision 2010Na105848 decided June 8, 2012

All appeals are dismissed. The costs of appeal are assessed against the plaintiffs.

The grounds of appeal are examined.

1. As to the grounds of appeal Nos. 1 through 5

Article 78(1) of the former Act on Acquisition of and Compensation for Land, etc. for Public Works Projects (amended by Act No. 8665 of Oct. 17, 2007; hereinafter “former Land Compensation Act”) provides that “A project operator shall either establish and implement relocation measures or pay resettlement funds to a person who is deprived of his/her base of livelihood as a result of the implementation of a public project (hereinafter “person subject to relocation measures”), as prescribed by the Presidential Decree, for the person who is deprived of his/her base of livelihood due to the provision of a residential building due to the implementation of a public project.” The main text of Article 78(4) provides that “The details of relocation measures shall include basic living facilities, such as roads, water supply facilities, drainage facilities, and other public facilities in the resettlement area, and the expenses required therefor shall be borne by a project operator.” Article 2 Subparag. 2 of the former Land Compensation Act provides that “public works refer to projects falling under any of the subparagraphs of Article 4, and Article 4 provides specific types of land subject to relocation measures or other public projects under the former Act.”

In full view of the adopted evidence, the court below acknowledged the following facts: (a) the citizen apartment removal project (hereinafter referred to as the "civil apartment rearrangement project") under Article 39 of the former Disaster Management Act (amended by Act No. 7188, Mar. 11, 2004) was conducted by entrusting the head of the competent Gu to individually purchase the citizen apartment; (b) the plaintiff 1, 2, 4, 6, and 7 (hereinafter referred to as the "the plaintiff 1 et al.") sold the citizen apartment rearrangement project according to the citizen apartment rearrangement project; and (c) the defendant was selected as the special supplier of national housing under the Seoul Special Rules on National Housing Supply for the Residents, etc.; and (d) the apartment apartment rearrangement project does not constitute the citizen apartment rearrangement project under Article 4 of the former Land Compensation Act (amended by Act No. 7188, Mar. 11, 2004; and therefore, (d) the citizen apartment rearrangement project does not constitute the citizen apartment rearrangement project under Article 8 of the former Land Compensation Act.

Examining the reasoning of the judgment below in light of the above legal provisions and the records, the judgment of the court below is just, and there is no error in the misapprehension of legal principles as to the scope of public works, violation of the rules of evidence

2. Regarding ground of appeal No. 6

As seen earlier, Article 78(1) of the former Land Compensation Act provides that the project implementer’s obligation to establish and implement the relocation measures, the main sentence of Article 78(4) of the same Act provides that the project implementer shall bear the cost of establishing the basic living facilities, and Article 40(2) of the former Enforcement Decree of the Act on Acquisition of and Compensation for Land, etc. for Public Works Projects (amended by Presidential Decree No. 20722, Feb. 29, 2008; hereinafter “former Enforcement Decree of the Land Compensation Act”) provides that “Where a person who wishes to move among the persons subject to the relocation measures has more than 10 houses unless there are any inevitable reasons prescribed by the Ordinance of the Ministry of Construction and Transportation, the relocation measures shall be established and implemented: Provided, That where the project implementer supplies a housing site or house to a person subject to the relocation measures (including the case of supplying it through the arrangement of the project implementer),

The main text of Article 78(1) of the former Land Compensation Act and the main text of Article 78(4) of the same Act, which stipulate the duty to establish and implement relocation measures, are compulsory provisions that cannot be excluded from the application by agreement of the parties or at the discretion of the project implementer. Therefore, if a person subject to relocation measures is paid the cost of basic living facilities to the project implementer, by including the cost of basic living facilities under Article 78(4) of the former Land Compensation Act in the sale price, which is entered into between the person subject to relocation measures and the project implementer or the supplier through his/her arrangement, in the special supply contract for housing entered into between the person subject to relocation measures and the project implementer or the supplier through his/her arrangement, and thus the person subject to relocation measures has been paid the cost of basic living facilities to the project implementer, etc., if the project implementer directly supplies housing, the portion which included the cost of basic living facilities in the sale price in the special supply contract violates Article 78(4) of the former Land Compensation Act, which is a mandatory law, and thus, the project implementer is obligated to return the amount equivalent to 2060.

However, Article 78 (1) of the former Land Compensation Act must be applicable to the person subject to the relocation measures, but the legal principle on the project operator's burden of cost of basic living facilities is applied. Thus, even if the plaintiff 1 et al., who provided residential buildings due to the rearrangement project of civil apartments not falling under the public works stipulated in each subparagraph of Article 4 of the former Land Compensation Act, believed that he/she himself/herself constitutes a person subject to relocation measures, such circumstance alone cannot be deemed to be null and void because the part of the sales contract for the apartment of this case entered into by the plaintiff 1 et al. included cost of basic living facilities in the sales contract for the apartment of this case, which the plaintiff 1 et al.,

The court below determined to the effect that even if the head of the competent Gu actually purchases the relevant apartment from the civil apartment owner, but the method of compensation is subject to the application of the former Act on Special Cases concerning the Acquisition of Land and Compensation for Loss (repealed by Article 2 of the Addenda to the Land Compensation Act (Act No. 6656 of Feb. 4, 2002) concerning the method of compensation, etc., and even if the head of the competent Gu purchased the relevant apartment and acquired the ownership, he/she did an act as if the former Special Act or the former Land Compensation Act applies, such circumstance alone that it is difficult to deem that the project operator gave the Plaintiff 1, etc. the trust that he/she would bear the cost of the basic facilities of the instant apartment.

Examining the reasoning of the judgment below in light of the aforementioned legal principles and records, the judgment of the court below is just, and there is no error in the misapprehension of legal principles as to the principle of trust protection.

3. As to the grounds of appeal Nos. 7 and 10

According to Article 78(1) and (4) of the former Land Compensation Act and Article 40(2) of the former Enforcement Decree of the Land Compensation Act, as part of the relocation measures, a project implementer is obligated to install a basic living facility and provide it to a person subject to relocation measures. In accordance with the proviso to Article 40(2) of the former Enforcement Decree of the Land Compensation Act, a person is not a project implementer who supplies a house to a person subject to relocation measures through an arrangement by a project implementer. Thus, even if a supplier entered into a supply contract at a price including an amount equivalent to the cost of basic living facilities with a person subject to relocation measures, this part of the supply contract cannot be deemed to violate Article 78(4) of the former Land Compensation Act (see Supreme Court Decision 2008Da973

In the same purport, the court below is just in holding that the sales contract of this case is not in violation of Article 78 (4) of the former Land Compensation Act even if the sales contract includes the amount equivalent to the cost of basic living facilities in the sales contract concluded between the plaintiffs and the defendant, and that the part of the sales contract is not in violation of Article 78 (4) of the former Land Compensation Act, and there is no error of law such as misunderstanding of legal principles as to the burden of cost of basic living facilities installation and the entrustment of relocation measures as alleged in the grounds of appeal.

4. Conclusion

Therefore, all appeals are 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.

Justices Jo Hee-de (Presiding Justice)