[1] Where a title trust relationship is established between a person who actually bears the title of the purchase price and a person who holds the title of the title of the real estate after the enforcement of the Act on the Registration of Real Estate under Actual Titleholder’s Name, the validity of an agreement to transfer the title of the real estate to the title of the title truster upon the request of the person who actually bears the burden of the purchase price (Invalidity) / The validity of a provisional registration completed under the title of the title truster’s title trust real estate in order to secure the title truster’s right to claim ownership transfer registration against the title truster based on the premise

[2] The validity of a provisional registration that was completed in the name of a third party to preserve the title truster's right to claim the transfer registration of ownership based on a legitimate reason separate from the title trust agreement (negative)

[1] In a case where a title trust relationship between a real obligor and a nominal holder of the purchase price is established as a result of purchasing real estate after the enforcement of the Act on the Registration of Real Estate under Actual Titleholder’s Name (hereinafter “Real Estate Real Name Act”), even though they agreed to transfer the ownership of the real estate at the request of the actual obligor of the purchase price, such agreement belongs to the category of the real estate title trust itself or the claim for return of the disposal price, under the premise that a title trust agreement is invalid under the Real Estate Real Name Act.

Furthermore, even if the title truster and the title trustee agree to complete the provisional registration under the name of the title truster in the title trust real estate and complete the principal registration when the title truster so requests in order to secure the right to claim ownership transfer registration against the title truster based on the premise of the agreement, such agreement is null and void as it is premised on a title trust agreement null and void under the Real Estate Real Name Act, and the provisional registration completed under the said agreement is null and void.

[2] Even if the title truster had a right to claim the transfer registration of ownership against the title trustee for a legitimate reason separate from the title trust agreement, if the provisional registration was completed in the name of a third party, other than his/her own name, to preserve that right, the provisional registration was completed in accordance with the title trust agreement between the title truster and the third party, and thus, its validity

[1] Article 2 subparag. 1 and Article 4 of the Act on the Registration of Real Estate under Actual Titleholder’s Name / [2] Article 2 subparag. 1 and Article 4 of the Act on the Registration of Real Estate under Actual Titleholder’s Name

[1] Supreme Court Decision 2006Da35117 Decided November 9, 2006 Supreme Court Decision 2009Da2576, 2583 Decided April 9, 2009, Supreme Court Decision 2011Da103472 Decided March 14, 2013 / [2] Supreme Court Decision 2009Da97024, 97031 Decided December 23, 2010

Plaintiff (Attorney Lee In-bok et al., Counsel for the plaintiff-appellant)

Defendant 1 and one other (Law Firm Name, Attorneys Park Byung-hee et al., Counsel for the defendant-appellant)

Incheon District Court Decision 2013Na1952 Decided August 29, 2014

The judgment below is reversed, and the case is remanded to the Incheon District Court Panel Division.

The grounds of appeal are examined.

1. As to the grounds of appeal Nos. 1 and 3

A. In purchasing real estate after the enforcement of the Act on the Registration of Real Estate under Actual Name (hereinafter “Real Estate Real Name Act”), where a title truster and a title truster enter into a title trust agreement between the actual obligor of the purchase price and the title truster, even though they agreed to transfer the title of the real estate to the title truster upon the request of the actual obligor of the purchase price, such agreement belongs to the category of the real estate title trust itself or the category of seeking return of the proceeds from the disposal of the real estate under the premise that a title trust agreement is null and void under the Real Estate Real Name Act, and thus shall also be deemed null and void (see, e.g., Supreme Court Decisions 2006Da3517, Nov. 9, 2006; 201Da103472, Mar. 14, 2013). Furthermore, even if the title truster and the title truster entered into an invalid title trust agreement under the premise that the title truster’s right to claim the ownership transfer registration against the title trustee based on such agreement, and thus, the title truster’s title trust agreement becomes null and void under 297.

Meanwhile, even if the title truster had a right to claim the transfer registration of ownership against the title trustee for a legitimate reason separate from the title trust agreement, if the provisional registration was completed in the name of a third party, other than his/her own name, to preserve the same, the provisional registration was completed pursuant to the title trust agreement between the title truster and his/her third party, and thus, its validity is null and void (see Supreme Court Decision 2009Da97024, 97031, Dec. 23, 2010).

B. The lower court determined, based on its adopted evidence, that Nonparty 1 purchased the instant land from Nonparty 2 and completed a title trust agreement with the Defendants on March 27, 2002 and completed the registration of ownership transfer in the name of the Defendants on the instant land on March 28, 202. At the time of the above title trust agreement, the Defendants were the title truster of the instant land, and the Defendants were merely the title trustee, and Nonparty 1 concluded a provisional registration on each of the instant land under the Plaintiff’s name with respect to each of the instant land for the purpose of restricting the disposal of each of the instant land, etc., and the Defendants were obligated to implement the provisional registration on each of the instant land under the Plaintiff’s name with respect to each of the instant provisional registration. In so doing, the lower court determined that each of the instant provisional registration under the name of the Defendants and the Defendants was in accordance with the agreement between the Plaintiff and the Defendants on each of the instant provisional registration under the name of the Defendants to prepare for arbitrarily disposing of the instant land under the name of the Defendants and to secure the ownership transfer registration under each of ownership registration under the instant agreement.

C. However, in light of the above legal principles, we cannot agree with the judgment of the court below for the following reasons.

According to the facts acknowledged by the court below, as to the land of this case 1 and 2 between the non-party 1 and the defendants, the name of ownership is entrusted to the defendants in the future, and in order to prevent the defendants from taking a voluntary disposition, the agreement was concluded that the defendants completed the principal registration of transfer of ownership on the land of this case 1 and 2. The above title trust agreement is null and void in accordance with the Real Estate Real Name Act, and the agreement that the defendants, the title trustee, completed the registration of transfer of ownership on the real estate of title trust at the request of the non-party 1, the title truster, should complete the registration of transfer of ownership at the future, and thus, the provisional registration of this case is null and void because the agreement that the defendants, the title trustee, completed the provisional registration in order to limit the defendants' voluntary disposition is also based on

In addition, according to the facts acknowledged by the court below, the plaintiff is nothing more than the title trustee of each provisional registration of this case in relation to the non-party 1. Thus, each provisional registration of this case is the registration of invalidity of cause under the title trust agreement.

Supreme Court Decision 95Da29888 delivered on December 26, 1995, Supreme Court Decision 95Da39526 delivered on September 30, 1997, Supreme Court Decision 2001Da15170, 15187 delivered on September 6, 2002, which is cited by the judgment of the court of first instance or the judgment of the court of first instance cited by the judgment of the court of first instance, are all related to a case where a title trust agreement is valid, and thus, it is not appropriate to invoke a title trust agreement in this case where it is null and void.

Nevertheless, the court below did not examine and determine whether the above agreement between Nonparty 1, the Defendants, and the Plaintiff is null and void against the Real Estate Real Name Act, and whether each of the provisional registrations of this case, which was completed accordingly, is null and void, and determined that the Defendants was liable to implement the principal registration procedure based on each of the provisional registrations of this case to the Plaintiff on the grounds stated in its reasoning. The court below erred by misapprehending the legal principles on title trust, which affected the conclusion of the judgment. The Defendants’ grounds for appeal pointing

2. Conclusion

Therefore, without examining the remaining grounds of appeal, the judgment of the court below is reversed, and the case is remanded to the court below for a new trial and determination. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Lee In-bok (Presiding Justice)