Plaintiff (Attorney Kim Young-soo, Counsel for plaintiff-appellant)

Defendant 1 and one other (Law Firm A&C, Attorneys Kim Tae-sik et al., Counsel for the defendant-appellant)

June 21, 2013

Seoul Southern District Court Decision 2012Da13037 Decided September 13, 2012

1. The plaintiff's appeal is dismissed.

2. The costs of appeal shall be borne by the Plaintiff.

On February 20, 2012, the Seoul Southern District Court 2010tae 25657, the amount of dividends to Defendant 1 among the distribution schedule prepared by the above court on February 20, 2012, KRW 6,853,881, and KRW 3,180,036 to Defendant 2, KRW 00, and KRW 18,037,509 to the Plaintiff, shall be corrected to KRW 54,794,235, respectively.

1. Basic facts

A. On March 10, 2005, the Geumcheon-gu Seoul (hereinafter “the instant real estate”) completed the registration of ownership transfer with respect to the said real estate (hereinafter “the instant real estate”). As indicated in the following table, the registration of the establishment of a neighboring mortgage and the registration of the entry into a decision of commencement of auction was completed.

On March 10, 2005, the registration date of establishment of a right-holder 1 mortgage on March 10, 2005, which was included within the main text, 201-2 mortgage creation bank Co., Ltd. (No. 228,000,000 won) 2-mortgage creation registration on February 10, 2005 (No. 228,000 won) 2-mortgage creation registration on November 13, 2008, Seoul District Court 201-33 compulsory auction commencement registration on March 29, 201-205 (No. 69,600,000 won for a maximum amount of claims) on March 30, 2010, Seoul District Court 201-201-20-33 compulsory auction commencement registration on March 10, 201-205 (No. 10,000 won for a creditor of the non-party 6427 compulsory auction commencement registration on March 29, 2010, 201010-201.

1) The Japanese Bank

B. On June 16, 2010, prior to the completion period for demanding a distribution, Defendant 1 made a demand for distribution based on the executory exemplification of the payment order issued by Seoul Southern District Court 2010 tea 616, and Defendant 2 made a demand for distribution based on the executory exemplification of the payment order issued by the Seoul Southern District Court 2010 tea 618, respectively, based on the executory exemplification of the payment order issued by the Seoul Southern Southern District Court 2010 tea 618.

C. After the Defendants made a demand for distribution as above, on November 9, 2010, the Plaintiff was set up a right to collateral security (hereinafter “instant right to collateral security”) as set out in the table Nos. 4 of the said paragraph.

D. After that, Defendant 1 applied for a compulsory auction on the instant real estate based on the payment order as above 2010 tea616, and Defendant 2 applied for a compulsory auction on the payment order as above 2010 tea618, respectively. Accordingly, the decision to commence a compulsory auction as stated in the table Nos. 5 and 6 of the above paragraph was issued, and each entry registration was completed on December 3, 2010.

E. On March 22, 2011, the prior auction procedure of the instant case was underway, the Nonparty withdrawn the application for the prior auction.

F. Upon withdrawal of the application for the preceding auction as above, the distribution court continued the auction procedure pursuant to the order of commencing a compulsory auction set forth in the table No. 5 of the above Paragraph (a) (hereinafter “instant subsequent auction”), and held a date of distribution and held the distribution on February 20, 2012, and held the distribution. The details of the distribution are as listed in the table below.

Defendant 1, 27,787,00 of the amount of credit, 787, 388, 202, 109, 109, 109, 109, 972, 109, 972, and 00 of dividends, 12344, June 30, 2010 and 16.48% of the amount of credit, 1,140, 368, 168, 208, 208, 2016, 308, 106, 306, 106, 40, 208, 106, 208, 106, 208, 106, 2016, 2016, 16, 306, 206, 306, 106, 2018, 206, 2016, 1636, 197

[Reasons for Recognition] Facts without dispute, Gap evidence 1, 2, Eul evidence 1-1, 2, 2-1 to 3-3, the purport of the whole pleadings

2. The plaintiff's assertion

In the event that the prior auction application of this case was withdrawn and the distribution was conducted in accordance with the procedure of the subsequent auction, the issue of whether the Plaintiff’s claim takes precedence over the Defendant’s claim under each payment order of this case should be determined as of December 3, 2010, not on June 16, 2010, which was the time when the Defendants made a demand for distribution in the prior auction procedure of this case, but on the basis of December 3, 2010, when the registration of the entry of the subsequent auction of this case was completed. However, the Plaintiff completed the registration of the establishment of the right to collateral security of this case on December 3, 2010, since the Plaintiff’s claim of this case was completed on December 9, 2010, the distribution court has priority over the Defendant’s claim under each payment order of this case. Accordingly, it is erroneous that the distribution court has distributed the amount distributed to the Defendants in proportion to distribution by understanding the Plaintiff’s above claim and the amount distributed to the Defendants should be distributed to the Plaintiff.

3. Determination

In a case where a general creditor has made a demand for distribution based on an executory exemplification before the completion period to demand a distribution in an auction procedure conducted by another creditor, the said demand for distribution has the effect corresponding to the seizure (see Supreme Court Decision 2000Da25484, Feb. 26, 2002). In a case where there is a person who has acquired a right to collateral security concerning the seized object after the seizure by a general creditor, the said person cannot oppose the above general creditor who has made the seizure. Thus, the said mortgagee cannot exercise his right to preferential payment against the above general creditor, and can only receive a distribution equally with the above general creditor, by dividing it from the proceeds of sale according to the ratio of the amount of the claim (see Supreme Court Order 94Ma417, Nov. 29, 194, etc.).

Meanwhile, as in the instant case, in the event that a general creditor makes a demand for distribution in the prior auction procedure and the prior auction procedure is revoked or withdrawn under the circumstances where the right to demand distribution was established and the subsequent auction procedure was issued, the auction court pursuant to Article 87(2) of the Civil Execution Act shall continue the auction procedure according to the subsequent auction decision unless contrary to Article 91(1) of the same Act. In this case, as to whether the effect of demand for distribution already made in the prior auction procedure continues to exist in the subsequent auction procedure, when the auction procedure is continued in accordance with the subsequent auction order under Article 87(3) of the Civil Execution Act, the period to demand distribution should not be notified to the person who has already made a demand for distribution, even if the new period to demand for the completion of the new period to demand distribution is determined, and it appears to have been premised on maintaining the effect of demand for distribution in the subsequent auction procedure after the effect of demand for distribution already made in the prior auction procedure, and if it is deemed unreasonable for the debtor to have exercised the right to demand distribution in the prior auction procedure to the effect.

Therefore, even if a prior auction procedure has been revoked or withdrawn, a general creditor who demanded a distribution may claim the validity of a demand for distribution equivalent to the seizure against a person holding the right to the right to the right to the right to the collective security, which was set after the time he/she demanded a distribution, and accordingly, he/she may be entitled to the said right in equal proportion to the amount of the claim regarding the proceeds of sale, as seen earlier.

In the instant case, since the Defendants received a demand for distribution of the claims under each of the above payment orders during the prior auction procedure, and the Plaintiff’s right to demand distribution was established after the Defendants received a demand for distribution of the claims under each of the above payment orders, the Defendants may assert the validity of a demand for distribution corresponding to the seizure against the Plaintiff, notwithstanding the withdrawal of the above preceding auction procedure, and accordingly, the Defendants and the Plaintiff received a distribution in proportion to their amount of claims in proportion to their amount of claims, so it is justifiable for the distribution court to prepare and distribute a distribution schedule as stated in the first B/C.

4. Conclusion

Therefore, the plaintiff's claim of this case shall be dismissed as it is without merit, and the judgment of the court of first instance is just, and the plaintiff's appeal is dismissed as it is without merit. It is so decided as per Disposition.

Judges in writing (Presiding Judge) and vice versa;

Note 1) After the change of a trade name into “Korea Standards Bank for Stock Companies”, the trade name was changed into “Korea Standards Bank for Stock Companies”.