[1] Where the objective meaning of the language and text of the disposal document is not clearly revealed, the method of interpreting the contents of the contract

[2] The case holding that where a contract is entered into in a provisional contract, "the purchaser shall enter into this contract within 10 days from the date of the provisional contract, and if the buyer fails to perform his/her duty, the contract shall become null and void, and the buyer shall not raise any objection to the civil or criminal matter, it shall not be deemed that there was an agreement to pay a penalty to waive the buyer's claim for the return of the provisional contract already paid upon the buyer's failure to perform

[3] In a case where a sales contract is terminated only due to a cause attributable to the seller, whether the buyer is liable to pay the penalty even if the sales contract is terminated due to a cause attributable to the buyer (negative)

[1] Article 105 of the Civil Act / [2] Articles 105, 398, and 565 of the Civil Act / [3] Articles 105, 398, and 565 of the Civil Act

[1] Supreme Court Decision 95Da6465 delivered on May 23, 1995 (Gong1995Ha, 2239) Supreme Court Decision 99Da43486 delivered on November 26, 199 (Gong2000Sang, 47) Supreme Court Decision 200Da72572 delivered on May 24, 2002 (Gong2002Ha, 1479) / [3] Supreme Court Decision 99Da49095 delivered on January 18, 200

Han Industrial Development Co., Ltd.

[Supplementary Development Co., Ltd. and one other

Seoul High Court Decision 2006Na90444 decided June 1, 2007

The judgment below is reversed and the case is remanded to Seoul High Court.

The grounds of appeal are examined.

1. According to the reasoning of the judgment below, the court below found, based on the adopted evidence, that the plaintiff entered into the provisional contract of this case with the defendant Cho Jong Development Co., Ltd. on May 30, 2005 (hereinafter "the defendant Lee Jong-chul Development"), and agreed to enter into this contract by paying KRW 400 million within 10 days from the date of the above provisional contract, and that the plaintiff provided the above KRW 400 million on June 10, 2005. Accordingly, the court below determined that the plaintiff did not comply with the above provisional contract term in light of the records, and that the judgment of the court below is just and acceptable in light of the records, and there is no violation of the rules of evidence as argued in the Grounds for Appeal.

2. If the objective meaning of the language and text is clear in cases where the parties to a contract prepare a certain contract in writing as a disposal document, barring special circumstances, if the objective meaning of the language and text is clear, it shall be acknowledged as the existence and content of the parties’ intent. However, in cases where the objective meaning of the language and text is not clearly revealed, it shall be comprehensively considered such factors as the motive and circumstance in which the contract was made, the purpose and genuine intent to be achieved by the parties by the contract, transaction practices, etc., so that the contents of the contract can be reasonably interpreted in accordance with logical and empirical rules, social common sense, and transaction norms so that it can be in line with the ideology of social justice and equity. In particular, if the content of the contract claimed by one party imposes a serious liability on the other party, it shall be more strictly interpreted (see Supreme Court Decision 200Da72572, May 24,

According to the reasoning of the judgment below, the court below acknowledged facts based on its adopted evidence, and determined that Article 1 of the terms and conditions of the contract of this case "the plaintiff refers to the conclusion of this contract within 10 days from the date of the provisional contract, and the non-performance of this contract shall become null and void, and no objection shall be raised to the plaintiff's Do resident or criminal matters" in the above terms and conditions, and that "any objection by the plaintiff shall be made within 40 million won" in the above terms and conditions, and that "any objection by the plaintiff" shall be deemed to be a subsequent context, and it shall be deemed that there is no possibility that other meaning than the claim for return of KRW 100,000 which was already paid by the plaintiff as the provisional contract deposit and the contract terms of this case shall not be included in the contract terms and conditions of this case." Article 2 of the provisional contract terms and conditions of this case shall not be deemed to be an infringement of the contract terms and conditions of this case, and shall be deemed to be an infringement of the contract terms and conditions of Article 1 of this case."

However, such determination by the court below is difficult to accept in light of the above legal principles.

In other words, in order to recognize that the Plaintiff and Defendant Morse Development agreed to pay a penalty of KRW 100 million paid as the provisional contract amount, it should be clearly recognized that the Plaintiff would waive the said KRW 100 million in the event of the Plaintiff’s breach of the contract between the Plaintiff and Defendant Morse Development in light of the content of the agreement, the motive and circumstance in which the contract was concluded, the purpose and genuine intent to be achieved by the parties, and transaction practices

However, the content of the agreement that the Plaintiff does not raise any objection can not be deemed clear that there was an agreement between the Plaintiff and the Defendant set up a penalty to waive the claim for refund of KRW 100 million in the event of the Plaintiff’s nonperformance of the contract. In addition, where the sales contract is rescinded due to a cause attributable to the buyer, even if the contract was rescinded due to a cause attributable to the seller, the agreement for penalty is null and void, separate from whether the agreement for penalty is null and void, and where the sales contract is rescinded due to a cause attributable to the seller’s fault, it does not recognize the seller’s obligation to pay the penalty, as in the case of cancellation due to a cause attributable to the seller’s fault (see Supreme Court Decision 9Da49095 delivered on January 18, 200, etc.). Moreover, Article 1 of the above agreement cannot be interpreted as providing for the penalty due to the Plaintiff’s nonperformance of the contract, which is the buyer under Article 2 of the above agreement, and there is no sufficient data to recognize that the remaining agreement was insufficient.

Nevertheless, the court below acknowledged that there was an agreement of penalty as above between the Plaintiff and Defendant Morse Development, and dismissed the lawsuit of this case as unlawful. In so doing, the court below did not err by misapprehending the legal principles on the interpretation of legal act, thereby affecting the conclusion of the judgment, and the allegation in the grounds of appeal containing this purport is with merit.

In addition, even if the plaintiff agreed to pay the above penalty between the defendant's records development, such an agreement of penalty has the nature of the liquidated damages as stipulated in Article 398 (1) of the Civil Code. Article 398 (2) of the Civil Code provides that where the amount of damages is unreasonably excessive, the court may reduce the amount of damages, and the above provision is not allowed as a mandatory law, and the agreement excluding the claim for reduction under the above provision in advance is not allowed. Thus, the above agreement of penalty is against the above provision, and its validity cannot be recognized. In this regard, the judgment of the court below can no longer be maintained.

3. Therefore, the lower judgment is reversed, and the case is remanded to the lower court. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Kim Hwang-sik (Presiding Justice)