2015Na2063297 Compensation (as can be claimed)

1. High ○○;

Chicago-si

2. Between South and North Korea;

Gyeonggi

3. Maternum;

Sungnam-si

[Defendant-Appellant] Plaintiff 1 and 2 others

[Defendant-Appellant]

1. (2) The Yonhap Housing Association;

Representative ○○○○

2. 주식회사 ◆◆◆

OO, OO for joint representative director

Defendants’ Address Manam-si

[Defendant-Appellant] Plaintiff 1 and 1 other

[Defendant-Appellant]

Suwon District Court Decision 2014Gahap61626 Decided October 27, 2015

March 17, 2016

April 21, 2016

All appeals by the Defendants against the Plaintiffs are dismissed.

The costs of appeal shall be borne by the Defendants.

Purport of claim

The defendants jointly serve the plaintiffs 100,000, 100 won and a copy of the complaint of this case.

The payment shall be made at the rate of 20% per annum from the day following day to the day of full payment.

Purport of appeal

The judgment of the first instance is revoked. All of the plaintiffs' claims against the Defendants are dismissed.

1. Presumed factual basis

The court's explanation on this part is based on the main text of Article 420 of the Civil Procedure Act, except that the following is added to 7 pages of the judgment of the court of first instance.

(f) The Plaintiffs asserted at the first instance trial as follows: (i) the Defendants delayed the performance of their obligations for 15 years without the intent to pay any balance arising from the initial sales contract and the modified sales contract; and (ii) the initial sales contract and the modified sales contract have become de facto impossible. Therefore, the Plaintiffs rescind all of the sales contract and the modified sales contract. As such, the Defendants seek for the payment of KRW 1,060,000,000, including the intermediate payment to be returned to the Defendants by the Plaintiffs from KRW 2.39,000 to KRW 740,000,000 for delayed compensation under Article 3 of the amended sales contract or compensation for damages due to cancellation of the contract. As such, the Defendants seek payment of KRW 1,00,000,000, which offsets the amount to be returned to the Defendants.

2) On October 27, 2015, the first instance court dismissed all the Plaintiffs’ claims against the Defendants on the following grounds. In other words, the Defendants’ joint business is being delayed without any progress, and whether to continue its business in the future is very unsound. As such, the Defendants’ performance of the obligation to pay the remainder to the Plaintiffs is in fact impossible or considerably difficult condition. Therefore, the first sales contract was cancelled by the Plaintiffs’ declaration of cancellation on the ground that the Defendants’ performance of the obligation to pay the remainder is de facto impossible. Therefore, the Plaintiffs’ first sales contract was cancelled by the Plaintiffs’ declaration of cancellation on the ground that the Defendants’ performance of the obligation to pay the remainder is de facto impossible. Therefore, the Plaintiffs returned to the original state following the cancellation of the first sales contract, which was already paid to the Defendants, KRW 330,00,00,000, and KRW 6660,000,000, partially remaining balance, and KRW 749,000,000 shall be returned from the Defendants, but it is evident that the Plaintiffs’ first damages claim against the Defendants under Article 3000.

2. Issues of the instant case

Whether there is a benefit of appeal to the defendant who won the whole appeal in the first instance.

3. The judgment of this Court

【Plaintiff’s Claim】

The Plaintiffs asserts as follows. No objection is allowed except in the case where a set-off defense has been accepted against all winning judgments. However, the Defendants did not assert a set-off defense in the first instance court, and the first instance court did not render a judgment as to a set-off defense. The first instance court was merely the cancellation of the first sales contract, but there was no details of settlement due to monetary payment and no other obligation of compensation is recognized. The first sales contract was rescinded.

The judgment on the reasoning portion does not affect res judicata, so if the validity of the first sales contract is recognized, the Defendants would have to seek the registration of ownership transfer based on the first sales contract, separate lawsuit. Therefore, the Defendants’ appeal should be dismissed as there is no interest in appeal.

【Claims by Defendants】

The Defendants asserts as follows. The judgment of the court of first instance: (a) the Plaintiffs shall recover the amount of KRW 749,00,000 from the Defendants due to the cancellation of the first sale contract; (b) the Plaintiffs shall also return the total amount of KRW 1,060,00,000 to the Defendants, including intermediate payments, etc.; and (c) the Plaintiffs shall not have any restitution or damages which the Plaintiffs may seek against the Defendants. Ultimately, the judgment of the court of first instance states that the Defendants’ right to claim the return of the purchase price incurred due to the cancellation of the contract is offset against the claim for damages, which is the claim sought by the Plaintiffs, which is the claim for reimbursement by the cancellation of the contract in this case; and (d) there is no restitution or damages against the Plaintiffs. However, the judgment of whether the claim for offset is established pursuant to Article 216 of the Civil Procedure Act has res judicata effect only in the amount against the set-off. Therefore, the Defendants are more beneficial to the Plaintiffs’ non-existence of the claim for damages rather than winning for offset on the grounds of set-off.

[Judgment] An appeal is to seek revocation or alteration of a judgment unfavorable to himself/herself, and in principle, an appeal against a judgment in favor of him/her is not allowed in light of the essence of the appeal system. Whether a judgment in favor of an appellant is disadvantageous to him/her shall be determined on the basis of the text of the judgment in principle. If an appellant’s assertion was accepted and won, there is no benefit in appeal even if there is an appeal for such reasons (see, e.g., Supreme Court Decisions 81Nu158, May 24, 1983; 94Da16458, Nov. 22, 1994). Furthermore, Article 216 of the Civil Procedure Act provides that a final judgment under paragraph (1) has res judicata effect only on matters included in the text of the judgment, and that the judgment in favor of the appellant has res judicata effect, for instance, determination of facts, interpretation and application of Acts and subordinate statutes, defense, and preemptive legal relations, and that the judgment of the court does not recognize the other party’s claim for set-off against which was established.

In a case where a set-off claim is the subject-matter of a lawsuit, or where it appears that the claim in question is substantially identical to the claim in question (such as a case where the plaintiff files a lawsuit of demurrer by asserting a set-off), it is reasonable to deem that it is necessary to treat the counterclaim claim that raised a set-off and the claim in question equally from the point of res judicata (see Supreme Court Decision 2004Da17207, Jul. 22, 2005). Ultimately, in a case where the defendant is dissatisfied with the judgment in the reasoning of the judgment regarding the whole dismissal of the plaintiff's claim, there is no benefit in filing an appeal except for the case where the plaintiff's claim that raised a set-off is established and the plaintiff's claim is dismissed (see Supreme Court Decisions 87Nu496, Feb. 28, 1989; 91Da406939, Mar. 27, 192; 9Da17209, Mar. 19, 1992).

In this case, the first instance court asserted that the Plaintiffs’ delayed payment claim amounting to KRW 2.39,00,000 against the Defendants was offset against the Defendants’ intermediate payment claim amounting to KRW 1,060,00,000 against the Defendant’s intermediate payment claim amounting to KRW 2.49,00,000, and KRW 749,000,000. The first instance court determined that the Plaintiffs did not seek reimbursement against the Defendants due to the cancellation of the first sales contract. The first instance court also returned KRW 1,060,000,000, such as intermediate payment, etc. to the Defendants due to the cancellation of the first sales contract. Accordingly, the lower court determined that there was no restitution or damages that the Plaintiffs could seek against the Defendants due to the cancellation of the first sales contract.

Ultimately, the judgment of the first instance, rather than the defendants' defense, judged that there was no restitution or damages that the plaintiffs can seek against the defendants according to the plaintiffs' assertion of offset. In this case, it is difficult to view that the claim for return, such as the intermediate payment, against the defendants, which is the passive claim subject to the plaintiffs' claim of offset, constitutes a lawsuit which is judged as a subject matter of lawsuit, or a case where it is deemed necessary to treat the opposite claim that is alleged a offset and its passive claim equally from the point of view of res judicata effect. Therefore, the judgment of the first instance as to this case does not constitute a case where "decision as to whether the claim claiming a offset is constituted or not" as provided by Article 216 (2) of the Civil Procedure Act, and therefore, the defendants who won the judgment of the first instance as to this case

4. Conclusion

Therefore, the appeal filed by the Defendants against the Plaintiffs is unlawful, and all of them are dismissed.

Judge exhauster of the presiding judge

Judges Park Jae-woo

Judges Park Jong-tae