SELDC Co., Ltd. (Attorneys Cho Young-soo et al., Counsel for the defendant-appellant)

Defendant 1 and one other (Law Firm Barun, Attorneys tin-ho et al., Counsel for the defendant-appellant)

Seoul Eastern District Court Decision 2011Gahap9684 Decided December 15, 2011

May 4, 2012

1. The defendants' appeal is dismissed.

2. The costs of appeal are assessed against the Defendants.

1. Purport of claim

The Defendants received KRW 1,651,350,000 from the Plaintiff and, at the same time, performed the registration procedure for transfer of ownership based on the sale on September 8, 201 with respect to one-half of the total share of 327 square meters in Gangdong-gu Seoul Metropolitan Government (number 1 omitted), Gangdong-gu (the Defendants added the conjunctive claim for the registration to be sold on November 3, 201).

2. Purport of appeal

The judgment of the first instance is revoked, and the plaintiff's claim against the defendants is dismissed.

1. Quotation of the first instance judgment

The reasoning for this Court’s explanation is that, except for the addition of Paragraph 2 to the determination of a new argument made by the Defendants in the trial, the reasoning for this case is as stated in the reasoning of the judgment of the court of first instance, and thus, it is cited pursuant to the main text of

2. Whether the exercise of the right to request sale is legitimate;

A. The defendants' assertion

Since the approval of the instant project plan was publicly announced in the Gu newsletter on June 8, 2011, the validity of the approval of the instant project plan became effective only on June 14, 201, which was five days after the date of the public announcement. Therefore, the Plaintiff may exercise the right to demand sale after consultation with the Defendants for at least three months from June 14, 201, namely, after consultation with the Defendants. However, since the Plaintiff exercised the right to demand sale on September 8, 201, the Plaintiff’s exercise of the right to demand sale on September 8, 201, which was exercised before the expiration of the consultation period, is unlawful.

B. Determination

According to the evidence No. 6-2, the fact that the approval of the project plan of this case was published in the Gu newsletter of Gangdong-gu as of June 8, 2011 can be acknowledged, and the public notice document under Article 8 (2) of the Administrative Management Regulations becomes effective five days after the date of public notice, so the public notice of the approval of the project plan of this case becomes effective on June 14, 201.

However, the above assertion by the Defendants cannot be accepted for the following reasons.

1) The Defendants’ assertion is based on the premise that “the validity of the approval of a business plan under the Housing Act takes place on the effective date of the public notice of the approval of the business plan.” However, since the approval of the business plan of this case was made upon the Plaintiff’s application, the other party to the approval of the business plan of this case is not only an unspecified number of people but also the Plaintiff. Therefore, the validity of the approval of a business plan of this case becomes effective upon notification to the Plaintiff, who is the other party to the disposition (see, e.g., Supreme Court Decision 2009Du11706, Nov. 12, 2009). In addition, considering the purport of the entire pleadings as stated in the evidence No. 4 and No. 5, it can be recognized that the Plaintiff was notified of the approval of a business plan of this case

2) Article 16(6) of the Housing Act provides that “When a project plan is approved, the person having the authority to approve the project plan shall publicly announce the matters related thereto (Article 16(6)).” Meanwhile, the project operator who has obtained the approval of the project plan shall implement the project according to the approved project plan and shall commence the construction within two years from the date of approval. Where a project operator fails to commence the construction works in violation of paragraph (7) (Article 16(7) and (9) (Article 16(1)). In addition, the Housing Act separates between “when the approval of the project plan is approved” and “when the approval of the project plan is publicly announced” (Article 17(1)). In light of the overall provisions of the Housing Act, regardless of the effect of the public notice of approval of the project plan, (i) dispositions shall be deemed to have become effective when the person who has applied for the approval of the project plan is notified of the approval of the project plan. Therefore, the Plaintiff shall be deemed to have exercised the right to claim the sale as prescribed in the project plan.

3. Conclusion

If so, the plaintiff's claim of this case shall be accepted, and the judgment of the court of first instance is justifiable with this conclusion. Therefore, the defendant's appeal is dismissed. It is so decided as per Disposition.

Judges Gangwon-won (Presiding Judge) Kim Sung-soo