Whether Article 576 of the Civil Act concerning the seller's liability for warranty shall apply mutatis mutandis in cases where the ownership of real estate is lost due to compulsory execution based on provisional seizure after the real estate which was the object of provisional seizure was purchased

If a purchaser of a real estate, which was the object of provisional seizure, loses ownership of the real estate by compulsory execution based on provisional seizure, it is similar to the case where the purchaser loses ownership of the real estate due to the exercise of mortgage or chonsegwon established for the purpose of sale, and thus, in such a case, the provision of Article 576 of the Civil Act concerning the seller's liability for warranty shall apply mutatis mutandis, and the buyer may rescind the sale contract pursuant to the provision of paragraph (1) of the same Article, and claim damages pursuant to paragraph (3)

Article 576(1) and (3) of the Civil Act

[Plaintiff-Appellant] Plaintiff 1 and 1 other (Law Firm Gyeong, Attorneys Park Jong-soo et al., Counsel for plaintiff-appellant)

Plaintiff

Defendant

Gwangju High Court Decision 2010Na1585 decided December 1, 2010

The appeal is dismissed. The costs of appeal are assessed against the defendant.

The grounds of appeal are examined.

1. On the first ground for appeal

The court below acknowledged the facts as stated in its reasoning based on its adopted evidence, and held that at the time of the conclusion of the real estate sales contract of this case, the obligation against the non-party subject to provisional seizure is not included in the obligation which the plaintiff acquired in lieu of the payment of the purchase price, and thus, the defendant bears the obligation to repay. This part of the ground of appeal is merely an error in the selection of evidence and fact-finding belonging to the exclusive jurisdiction of the court below, which is a fact-finding court, and it cannot be viewed as a legitimate ground of appeal.

2. On the second ground for appeal

According to the facts established by the court below, the plaintiff purchased the real estate of this case from the defendant and completed the registration of transfer of ownership, but the procedure for compulsory auction was conducted upon the application of the non-party of provisional seizure creditor who had been registered previously, and thereby the plaintiff lost its ownership.

If a purchaser of real estate, which was the object of provisional attachment, loses ownership of the real estate due to compulsory execution based on the provisional attachment, it is similar to the case where the purchaser loses ownership of the real estate due to the exercise of mortgage or chonsegwon established for the purpose of sale and purchase. In such a case, it is reasonable to view that Article 576 of the Civil Act concerning the seller's liability for warranty applies mutatis mutandis, and that the purchaser may rescind the sales contract pursuant to paragraph (1) of the same Article and claim damages pursuant to paragraph (3) of the same Article (see Supreme Court Decision 92Da21784 delivered on October 27, 1992).

The decision of the court below to the same purport is just, and there is no violation of law such as misunderstanding the seller's warranty liability and contract cancellation as otherwise alleged in the ground of appeal.

3. 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.

Justices Lee Sang-hoon (Presiding Justice)