Whether the right to purchase a building is recognized even if the right to collateral security has been established on the building (affirmative), and in such case, the method of calculating the purchase price of the building.

As the period of a land lease contract for the purpose of owning a building expires, the right to demand purchase under Article 643 of the Civil Act, which the owner of the building exercises against the lessor, is recognized even when the right to demand a purchase has been established on the building subject to the request for purchase. In such cases, the purchase price of the building refers to the amount equivalent to the market price assessed at the present condition of the building as at the time of the exercise of the right to demand a purchase, comprehensively taking into account the location of the building in addition to its own price and the various circumstances of surrounding land, etc. In this context, the amount obtained by deducting the maximum debt amount of the right to demand a purchase or the secured debt amount from the purchase price shall not be determined as the purchase price: Provided, That if the owner of the building who has exercised the right to demand a purchase fails

Articles 283, 588, and 643 of the Civil Act

Supreme Court Decision 72Da341 Decided May 23, 1972 (No. 20-2, No. 63), Supreme Court Decision 87Meu390 Decided June 23, 1987 (Gong1987, 1235), Supreme Court Decision 87Meu1029 Decided September 27, 198 (Gong198, 1328), Supreme Court Decision 2002Da4603, 46027, 46010 Decided November 13, 2002 (Gong203, 67)

[Judgment of the court below]

Defendant (Law Firm Chump, Attorneys Oil-kin, Counsel for defendant-appellant)

Daegu District Court Decision 2005Na11075 Decided December 13, 2006

The part of the judgment of the court below regarding the second preliminary claim is reversed, and that part of the case is remanded to the Daegu District Court Panel Division. The remaining grounds of appeal are dismissed.

The grounds of appeal are examined.

1. Regarding ground of appeal No. 1

After compiling the evidence cited in the judgment, the court below acknowledged facts as stated in its holding, and judged that the lease contract of this case between the plaintiff and the defendant on July 8, 2000 expired due to the expiration of the lease term (five years) at the time of 2005. In light of the records, the above recognition and judgment of the court below is just and there is no violation of the rules of evidence, etc.

2. As to the grounds of appeal Nos. 2 and 3

As the period of the land lease contract for the purpose of owning a building expires, the right to demand purchase under Article 643 of the Civil Act, which the owner of the ground building exercises against the lessor, is recognized as a case where the right to collateral security is established on the building subject to the claim for purchase (see Supreme Court Decision 72Da341 delivered on May 23, 1972).

In such a case, the purchase price of the building refers to the amount equivalent to the market price assessed at the present condition of the building as at the time of the exercise of the purchase right by comprehensively taking into account the location of the building in addition to its own price and the various circumstances of surrounding land (see Supreme Court Decision 2002Da4603, 4603, 46027, and 46010, Nov. 13, 2002). Here, the amount calculated by subtracting the maximum debt amount or the secured debt amount shall not be determined as the purchase price. However, if the owner of the ground building who has exercised the purchase right does not cancel the above right of collateral, the landowner may refuse to pay the purchase price equivalent to the maximum debt amount until the cancellation of the right of collateral security is registered pursuant to Article 588 of the Civil Act (see Supreme Court Decision 87Meu1029, Sept. 27, 198).

According to the judgment below, on December 12, 2005, the court below acknowledged that the legal relationship between the plaintiff and the defendant with respect to the newly constructed building of this case was established upon the defendant's exercise of the defendant's right to purchase, and (1) with respect to the amount of the purchase price of the newly constructed building of this case, according to the records of this case (the method of calculating the price for the newly constructed building of this case attached to the complaint of this case), the market price of the building of this case as of November 18, 2003 can be recognized as 39,28,940, which is near the time when the above right to purchase the new building of this case was exercised. Thus, it is reasonable to view that the purchase price for the building of this case to be paid by the plaintiff to the defendant was the above money, and (2) the defendant set up the ground for 65 million won on September 27, 2001 as the market price of the newly constructed building of this case did not reflect the claim secured by the above right to purchase of this case.

However, in light of the aforementioned legal principles, the court below erred by misapprehending the legal principles as to the exercise of the right to purchase, failing to exhaust all necessary deliberations as to the market price of the subject matter of sale, which affected the conclusion of the judgment, by recognizing the market price of the building as KRW 39,288,940, based on the standard market price of taxation under the Local Tax Act and subordinate statutes at the time of the difference of two years or more from the date of exercise of the right to purchase (the value of the subject matter of lawsuit in respect of the building was calculated according to the recognition rules of civil procedure, etc. at the time of the filing of the lawsuit in this case, which was considerably lower than the market price in general.).

3. Therefore, the part of the judgment of the court below regarding the second preliminary claim is reversed, and that part of the case is remanded to the court below for a new trial and determination. The remaining appeals are dismissed. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Kim Nung-hwan (Presiding Justice)