In case where a worker’s right to preferential payment of wage claims has been exercised in the ship auction procedure, whether a mortgagee on a ship may exercise the worker’s right to preferential payment of wage claims in the procedure of real estate auction conducted later by applying Article 368 of the Civil Act mutatis mutandis (negative)

Article 368 of the Civil Act is not applicable in cases where an employee’s right to preferential payment of wage claims is exercised in the ship auction procedure, and an employee’s real estate is auctioned. Thus, even if the auction procedure for a ship is in progress, and the employee’s right to preferential payment of wage claims is distributed first, and the mortgagee for a ship is not paid dividends or dividends only are less than the amount that the mortgagee could have received if the auction procedure for the real estate and the ship were carried out simultaneously, the mortgagee on the ship cannot exercise the right to preferential payment of wage claims by subrogation

Article 368 of the Civil Act, Article 861(1)2 of the Commercial Act, Article 172 of the Civil Execution Act

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

National Federation of Fisheries Cooperatives (Law Firm Cheonghae, Attorneys Seo-soo et al., Counsel for the plaintiff-appellant)

Large-sized High-Tech Fisheries Cooperatives (Law Firm Samduk, Attorneys Song-il et al., Counsel for the plaintiff-appellant)

Seo-gu Busan Metropolitan Government and one other (Attorney Choi Yong-sung, Counsel for the plaintiff-appellant)

Korea Mutual Savings Bank

Article 33 (Change of Trade Name before Change of Korea Mutual Savings Bank: Korea Mutual Savings Bank)

Busan High Court Decision 2001Na10649 delivered on May 21, 2002

The part of the judgment of the court below against the defendant large-sized fishing village fisheries cooperative is reversed, and that part of the case is remanded to Busan High Court. The plaintiff's appeal is dismissed. The costs of appeal against the dismissed appeal are assessed against the plaintiff.

1. Facts acknowledged by the court below

A. In the auction procedure where the Plaintiff’s exercise of the right to collateral security on the instant vessel owned by the Nonparty, the auction court distributed to the employees employed by the Nonparty the wage claim under Article 37(2) of the Labor Standards Act, preferentially to the crew of the instant vessel, the claim with the right to collateral security under Article 861(1)2 of the Commercial Act, and distributed only a part of the amount of demand for distribution to the Plaintiff.

B. Meanwhile, in the auction procedure where the withdrawn Defendant Korea Mutual Savings and Finance Company, Inc. executed the right to collateral security on the instant real estate owned by the Nonparty, the Plaintiff did not distribute dividends to the Plaintiff in the order of the Defendant Association, the mortgagee of the instant vessel auction procedure, which was first distributed to the employees and crew members, but the auction court did not distribute the dividends to the Plaintiff in the order of the Defendant Association, the mortgagee of the instant vessel auction procedure No. 1 and No. 2, and the Korea Mutual Savings and Finance Company, the mortgagee No. 3, the Korea Mutual Savings and Finance Company, and the Korea Mutual Savings and Finance Company, the mortgagee No. 3, the mortgagee, the

2. Judgment on the grounds of appeal by the Defendant Union

In the instant real estate auction procedure, the lower court deemed that the Plaintiff’s exercise of the right to preferential payment of wage claims in the instant ship auction procedure, on behalf of workers who received dividends by exercising the right to preferential payment of wage claims, and accepted the subrogated part of the workers who exercised the right to preferential payment of wage claims in the Plaintiff’s claim

However, Article 368 of the Civil Act does not apply to cases where a worker’s right to preferential payment of wage claims is exercised in the ship auction procedure and the employer’s real estate is auctioned (see Supreme Court Decision 2001Da53264, Jul. 12, 2002). Thus, even if the auction procedure for a ship is in progress, and the worker’s mortgagee’s right to preferential payment of wage claims is paid in advance and the auction procedure for the real estate and the ship is in progress, and at the same time, the mortgagee cannot exercise the right to preferential payment of wage claims on the ship by subrogation of the worker’s right to preferential payment in the auction procedure for the real estate of the employer.

Nevertheless, the court below erred by misapprehending the interpretation and application of Article 368 of the Civil Act, thereby affecting the conclusion of the judgment, and the ground of appeal by the defendant association pointed this out has merit.

3. Judgment on the Plaintiff’s grounds of appeal

The court below is justified in holding that the maritime lien under Article 861 of the Commercial Act is recognized only for the ship, its equipment, the freight for the voyage in which the claim occurred, the freight for the ship and its freight, and the claims incidental to the ship and its freight, and thus cannot be extended to the debtor's other property. In addition, in the real estate auction procedure of this case, the plaintiff is justified in holding that the plaintiff cannot exercise the preferential right of wages of the seafarers by analogy of Article 368 of the Civil Act, even within the limit of the amount equivalent to the wage claim that the seafarer is entitled to preferential reimbursement in accordance with Article 37 (2) of the Labor Standards Act out of the amount paid to him by exercising the maritime lien during the ship auction procedure of this case, and there is no

4. Conclusion

Therefore, the part of the judgment of the court below against the defendant union is reversed, and that part of the case is remanded to the court below, and the plaintiff's appeal is dismissed, and it is so decided as per Disposition.

Justices Zwon (Presiding Justice)