The case holding that in a case where Gap bank filed a claim against Byung for confirmation of non-existence of lien against Eul, on the grounds that it cannot be said that the seizure of the decision on commencing auction does not extend to new buildings, and that Byung corporation's claim does not have a benefit of confirmation on the ground that the seizure of the decision on commencing auction does not affect new buildings, in a case where Eul bank's claim against Byung for non-existence of lien was confirmed to have the effect of seizure of the decision on commencing auction on the ground that Eul bank's claim on the secured debt of the factory mortgage against Eul, it cannot be said that the seizure of the decision on commencing auction does not affect new buildings.

In a case where Gap bank established a factory mortgage on Eul's land for factory, 3 buildings on factory and machinery and instruments owned by Eul in order to secure loan claims against Eul corporation, the mortgage was established on Eul corporation's land for factory; Byung corporation removed 1 existing buildings on Eul company's land for factory; started construction by being awarded a contract for construction of 2 new buildings on the new site; and ceased construction due to Eul's default; and when compulsory auction and voluntary auction were commenced on the object of factory mortgage, the mortgage claim amount on new building's land for new construction as mortgage was reported as secured claim; and since Eul bank's acquisition of secured claim on factory mortgage against Byung corporation, the decision of voluntary auction commencement of auction is effective only on registered land and building and its appurtenant or accessory objects; since new building's new building's new building's new building's new building's new building's new building's new building's new building's new building's new building's new building's new building's new building's new building's new building's new building's new building's new building's new building's new building's new building's new building's new building's new building's new building's new building's new building's new building's new building's new building's non-mortgage.

Articles 4 (see current Article 3 of the Factory and Mining Foundation Mortgage Act), 5 (see current Article 4 of the Factory and Mining Foundation Mortgage Act), 7 (1) (see current Article 6 (1) of the Factory and Mining Foundation Mortgage Act), 3, 4, and 6 (1) of the Factory and Mining Foundation Mortgage Act, Articles 100, 256, 320, and 358 of the Civil Act, Article 250 of the Civil Procedure Act

The first-class securitization Specialized Company (Law Firm Han & Yang LLC, Attorneys Kim Il-han, Counsel for the plaintiff-appellant)

CNP Co., Ltd. (Law Firm Jeong, Attorney Kim-hee, Counsel for the defendant-appellant)

Daegu District Court Decision 2015Gahap15712 decided June 3, 2016

October 27, 2017

1. Revocation of the first instance judgment.

2. The main claim of this case and the ancillary claim added at the trial shall be dismissed in all.

3. All costs of the lawsuit shall be borne by the Plaintiff.

Of the judgment of the court of first instance, the part against the plaintiff shall be revoked. In the first instance, with respect to the compulsory auction of real estate in 1,054,280,000 won which the defendant reported to the above court on February 25, 2013 as the secured claim, the part against the plaintiff in the judgment against the plaintiff shall be revoked. In addition, with respect to the compulsory auction of real estate in 1,054,280,00 won which the defendant reported to the above court on February 25, 2013 as the secured claim, it shall be confirmed that there is no lien as to each building listed in the separate sheet as the secured claim in 1,054,280,000 won which the defendant reported to the above court on February 25, 2013 as the secured claim (the plaintiff added the conjunctive claim in the first instance court).

1. Basic facts

A. On November 23, 2007, the Industrial Bank of Korea completed the registration of the establishment of a mortgage of KRW 10,80,000 on the old-si factory site owned by the non-party company ( Address omitted) for the purpose of securing loans to EPP Co., Ltd. (hereinafter referred to as “non-party company”) (hereinafter referred to as “the foregoing Gu-si factory site”), and completed the registration of the establishment of a mortgage of KRW 10,80,00,00 on the old-si factory site, ② on April 25, 2008, the above building of the Gu-U.S. factory building [the general factory of the 1st floor structure (workplace) 2,963.68 square meters, the general factory of the 2,900,660 square meters, the general factory of the 3rd-story building structure (office) and the general factory of the 1,087,400,087.6 square meters, and the 209,2082,200,06,00.2,00.2.2.

B. On December 16, 2011, the Defendant entered into a contract with the Nonparty Company (hereinafter “instant contract”) under which the Defendant was awarded a contract with the Nonparty Company for the construction of removal of the aforementioned machinery equipment, such as PE/PV, from the Nonparty Company to the land for a factory in the city of Ansan (hereinafter “instant installation relocation construction”) and ② construction of the existing B-dong building, etc. on the said land for a factory in the Gu and the construction of the new equipment in the said new building (hereinafter “instant construction”) to the said new building, with the total construction cost of KRW 2,50,000,000 (excluding value-added tax) (hereinafter “instant construction”). The main contents of the instant contract are as follows.

The name of the construction project in the main sentence 1. A: The contract amount of the SCP (Non-Party Company) Recry and the factory relocation (B) contract amount: KRW 2,500,000,000 (Additional Tax c) contract period: the construction site from December 16, 201 to May 30, 201: EsP (Non-Party Company) contract amount: KRW 1,00,000,000,000,000 (Additional Tax c) contract amount: KRW 1,50,000,000,000,000,000,000,000,000,000,000,000,000,000,00,00,00,00,00,00 after the completion of the PE/P contract: An advance payment after entering into a contract;

C. From December 16, 2011, the Defendant commenced the above facility relocation work and completed it around May 30, 2012.

D. From January 2012, the Defendant had been performing the instant construction from around September 17, 2012, and was unable to receive the construction cost from the non-party company due to the non-party company’s default. Before suspending the instant construction, the instant construction was suspended. Before suspending the construction, the factory building newly built by the Defendant was indicated by the instant construction, and the building 1,133.6 square meters (attached Form No. 1, 2, 3, 4, 1, and 2, 704 square meters (the size of materials in the ship connected each point), 704 square meters (the indication of the attached Form No. 5, 6, 7, 8, and 5) of the general steel structure building on the second floor in the attached Table No. 2 (hereinafter collectively referred to as the “new building”).

In order to construct the new building of this case, the non-party company obtained a construction permit (the name of the non-party company is "extension permit", but the substance is "new construction permit") from the Gu and the non-party company obtained on July 5, 2012 from the Gu and the permission for installation of hazardous materials factory (the name and quantity of products: No. 4: 700-liters for petroleum No. 1, petroleum No. 4; 20,000-liters for paint No. 700-liters for petroleum No. 1, and No. 4, 3.50-liters, drainage 13.50-liters, factory size 1,199.4 square meters, and 8-liters for handling tank No. 8). The above construction permit of April 27, 2012 was newly constructed on the factory-mortgage No. 1,128.30-liter of the previous B-dong building among the objects of the factory mortgage, and removed the new building No. 154, 1954.54.

On May 14, 2012, the registration of destruction was completed on April 27, 2012 with respect to the existing B-dong building.

E. Of the subject matter of the foregoing factory mortgage, a decision to commence a compulsory auction (Seoul District Court Decision 201Mo7846 decided Sept. 26, 2012) was issued on September 26, 2012 (hereinafter “instant compulsory auction”) with respect to the above factory site, existing Adong building, existing Cdong building, and the previous Cdong building, and the decision to commence the compulsory auction (hereinafter “instant compulsory auction”) was completed on October 2, 2012. The registration of the instant decision to commence the compulsory auction was completed on October 2, 2012. Upon the Industrial Bank of Korea’s voluntary auction application based on the foregoing factory mortgage (hereinafter “instant voluntary auction”) on December 16, 2013 for all the subject matter of the instant factory mortgage, the decision to commence the compulsory auction (hereinafter “voluntary auction”) (Seoul District Court Decision 2013Ma8566 decided Dec. 16, 2013) (hereinafter “instant voluntary auction”) and the instant compulsory auction (hereinafter “instant compulsory auction”).

On February 25, 2013, the Defendant reported a lien with the Defendant’s claim for the construction cost (1,054,280,000 won) as the secured claim on the newly constructed building of this case on the ground that the Defendant’s construction of new building of this case was 80% of the foundation height of the instant new building due to the instant construction of this case, and that the amount of the claim for the construction cost on the said flag reaches 1,054,280,000 won.

F. On January 2014, the Plaintiff acquired the secured debt of the above factory mortgage from the Industrial Bank of Korea, and on January 21, 2014, on January 21, 2014, reported the change of the mortgagee of the above factory mortgage at the instant auction procedure.

[Based on the basis of recognition] A without dispute; Gap evidence Nos. 1, 2, 3; Eul evidence Nos. 1, 3-1 through 7; evidence Nos. 26 through 27; 40, 33-1, 2, and 34-1, 2, and 34; the testimony of Non-Party 2 by the witness of the first instance court; the inquiry into the old U.S. market on January 5, 2016; the result of the inquiry into the fact about the Daegu District Court's Kimcheon (Auction) on February 3, 2016 and March 3, 2016; the purport of the entire pleadings;

2. Whether the lawsuit and the conjunctive claim are lawful; and

A. The parties' assertion

1) The plaintiff's assertion

The new building of this case is established for the whole utility of a factory located in the factory site in the above old city in the above old city, which is the object of the factory mortgage of this case, and is in conformity with the above old city factory site, and the seizure of the new building of this case takes effect by the decision on commencing auction of this case. Therefore, the new building of this case is included in the object of auction of this case, and the plaintiff takes over the secured debt of factory mortgage from the Industrial Bank, which is the mortgagee of the factory of the object of auction of this case, there is a benefit to seek confirmation that there

2) The defendant's assertion

Since the new building of this case was newly constructed on the site that was created by demolishing the existing building of this case, it does not have the effect of seizure by the decision on commencing the sale of this case. Therefore, the plaintiff's primary claim and conjunctive claim are sought to confirm lien for the new building of this case, not the object of the sale of this case. Thus, the plaintiff's primary claim and conjunctive claim are unlawful because there is no benefit of confirmation in whole.

B. Legal principles

A mortgage established by the owner of a factory on the land belonging to the factory shall not be effective in cases where there is a special agreement on the act of setting up, or not on the things attached to the land except for a building and on the machinery, apparatus and other things installed on the land installed thereon, and in cases where an obligee can cancel the act of the obligor under Article 406 of the Civil Act (Article 4 of the Factory Mortgage Act). The provisions of Article 4 of the Factory Mortgage Act shall apply mutatis mutandis to the mortgage established by the owner of the factory on the building belonging to the factory (Article 5 of the Factory Mortgage Act). In cases of applying for a registration of the creation of mortgage on the land or building belonging to the factory, the list of machinery, apparatus and other things of the building which are the object of the mortgage pursuant to Articles 4 and 5 (Article 7 of the Factory Mortgage Act).

A mortgage established by the owner of a factory on the land belonging to the factory shall be effective on the things attached to the land and on the machinery, apparatus and other factory installed on the land: Provided, That this shall not apply in cases where there is a special agreement on the act of creation and in cases where the creditor can cancel the debtor's act pursuant to Article 406 of the Civil Act (Article 3 of the Mortgage of Factories and Mining Foundations Act). Article 3 shall apply mutatis mutandis to the mortgage established by the owner of a factory on the building belonging to the factory, and in such cases, "land" shall be deemed "building" (Article 4 of the Mortgage of Factories and Mining Foundations Act). In order to apply for a registration of creation of mortgage on the land or building belonging to the factory, the list of the machinery, apparatus and other public goods of the factory which are the object of the mortgage pursuant to Articles 3 and 4 (Article 6 of the Factory and Mining Foundation Mortgage Act).

According to Article 358 of the Civil Act, the effect of factory mortgage under Articles 4 and 5 of the Factory Mortgage Act shall naturally extend to the objects and accessories belonging to the factory mortgage unless there are special circumstances, such as otherwise stipulated in the act of establishing the mortgage. The accessories of the mortgaged real estate having the effect of mortgage are the same as the accessories stipulated in Article 100 of the Civil Act. A building must contribute to the commercial use of the principal property for the purpose of causing the accessory to the principal building. This means that a certain building has a relation of contributing to the commercial use of the principal property, and this means the economic utility of the principal property. Thus, even if the principal property is offered for use by the owner or user, things irrelevant to the utility of the principal property itself are not accessories (see Supreme Court Decision 2007Do7247, Dec. 13, 2007, etc.).

In the case of extension of a building, not only the physical structure attached to the existing building, but also whether the extension can be an object of separate ownership in the transaction with an independent economic utility from the existing building in terms of its use and function, and the intent of the owner of the building by comprehensively taking account of the following factors (see Supreme Court Decisions 2000Da63110, Oct. 25, 2002; 201Ma1525, Apr. 30, 2012, etc.).

A mortgage is not effective, except as otherwise provided by law or provided by an act of creation. Thus, in the auction procedure for land, since a building on the ground is regarded as an accessory to the land and an accessory thereto, the change in the ownership of the building cannot be caused by the change of the ownership, on the ground that the auction procedure for the land is conducted along with the mortgaged land and the auction is permitted at the auction court (Supreme Court Decision 97Da10314 delivered on September 26, 1997).

C. Facts of recognition

The following facts are acknowledged in full view of the following facts: Gap's facts, non-contentious facts, Gap's evidence 1 through 5, 7, 15-1 through 18, Eul's evidence 1 through 6, Eul's evidence 1, 2, 17, evidence 21 through 26, evidence 33-1, 2, 34-1, 33-2, 34, the result of inquiry into the old market of the first instance (as of January 5, 2016), the result of inquiry into the auction court of the first instance (as of February 3, 2016 and March 3, 2016) into the auction court of this case; the result of on-site verification by this court; the result of on-site verification by this court; and the purport of all pleadings.

① On April 25, 2008, the Industrial Bank of Korea, in addition to mortgages on factory sites at the time of the previous US on April 25, 2008, completed the registration of establishment of the factory pursuant to the Factory Mortgage Act by using existing Adong buildings, existing Cdong buildings, and machinery and equipment as joint collateral, and added the existing Bdong buildings to the joint collateral of the factory mortgage on January 14, 2010.

② Of the objects of the foregoing factory mortgage, the non-party company: (a) removed the parts of 1,128.30 square meters, including the previous B-Dong building; and (b) newly constructed the two-Dong factory building 1,954.05 square meters on the same site (i.e., G-dong building 1,199 square meters + 754.65 square meters) (i.e., H-dong building 754.65 square meters); (b) obtained a construction permit on April 27, 2012; (c) completed the instant construction until September 17, 2012, and newly constructed the new building on the newly constructed site after removing the parts of 1,128.30 square meters at the time of the removal of the said new building. The new building in this case was completely separated from the existing A-dong building and the previous C-Dong building. Each building of the new building in this case may be independently used as the new building at the time of compulsory commencement of ownership registration. The same applies likewise to the new building in this case.

③ On July 18, 2012, a new bank completed the registration of the establishment of a factory foundation mortgage (hereinafter “new bank’s factory foundation mortgage”) with respect to the land, buildings, and machinery, which is the object of the said factory mortgage, attached with the list stipulated in Article 6 of the “factory and Mining Foundation Mortgage Act”.

④ The auction court of this case deemed that the said new building of this case constitutes the object of mortgage on the factory foundation of the Industrial Bank of Korea, and decided to sell all the objects of mortgage on the factory foundation of the said new building of this case and mortgage on the factory foundation of the new bank, including the new building of this case, on May 8, 2015.

D. Determination

The effect of the decision on commencing voluntary auction of this case shall be limited to registered land and buildings, and their accessorys or accessories. The effect of the decision on commencing voluntary auction of this case shall only extend to the objects (such as land for a factory, existing buildings, machinery and apparatus) and their accessorys or accessories of the above factory mortgage. ② Since the new building of this case was not a new building built on the site that was created after removing the parts, including the previous building, the new building of this case shall not be deemed to correspond to or be an accessory to the land for a factory of the above Gu and the new building of this case. ③ The new building of this case is an independent building that was completely separated from the existing building of the new building of this case and the existing building of the new building of this case, and it shall not be deemed that the new building of this case is an accessory to the existing building of the existing building or the existing building of the new building of this case, or it shall not be deemed to be an accessory to the new building of this case.

As long as the new building of this case is not included in the object of the auction of this case, i.e., the object of the mortgage of the above factory, the plaintiff who acquired the secured obligation of the above factory, has no benefit to seek confirmation that there is no lien for the new building of this case which is irrelevant to the auction of this case.

3. Conclusion

The judgment of the court of first instance shall be dismissed, since all of the conjunctive claims added in the lawsuit and the trial of the case are unlawful. Since the judgment of the court of first instance is unfair with different conclusions, the judgment of the court of first instance shall be revoked, and all of the conjunctive claims added in the lawsuit and the trial of the case shall be dismissed, and it is so decided as per Disposition.

[Attachment] List of Real Estate: omitted

Judges Jin Sung-chul (Presiding Judge) Criteria