[1] The relationship between the lessor's duty to repair and the lessee's duty to pay the rent for the lease contract

[2] Whether a lessee’s obligation to return unjust enrichment is established in a case where the lessee continued to possess the leased object even after the lease contract relationship terminated, but fails to use it or make profit according to the original contractual purpose (negative)

[3] Whether a tenant who was unable to receive a lease deposit after the termination of the lease continues to possess the object by exercising his/her right of defense of simultaneous performance (negative)

[4] A person who bears the cost of restoring to the original state with respect to a person’s ordinary loss incurred from the lease (i.e., a lessor without a special agreement) and the requirements for the lessee to bear the duty of restoring to the lessee

[5] Scope of loss suffered by a lessor due to a delay in the duty to restore the lessee upon termination of the lease

[1] In a lease agreement, a lessor’s obligation to allow a lessee to use and benefit from an object in line with the original purpose of the lease is equal to the lessee’s obligation to pay rent. Therefore, in a case where a lessor is unable to use the object at all due to his/her nonperformance of the obligation to repair the object, the lessee may refuse to pay the entire rent.

[2] The benefit in return of unjust enrichment on the ground that the benefit was obtained without any legal ground refers to the substantial benefit. Thus, in a case where a lessee continued to possess the leased building portion even after the lease contract relationship was terminated, but fails to obtain substantial benefit due to the failure to use it or make profit in accordance with the original purpose of the lease contract, even if the loss incurred to the lessor, the lessee’s obligation to return unjust enrichment

[3] Since a lessee’s obligation to return the leased object and the lessor’s obligation to return the remainder after deducting the lessor’s default upon the termination of the lease agreement is in a simultaneous performance relationship, barring any assertion or proof by the lessor, as to the lessor’s loss of the right to simultaneous performance of the leased object due to such reasons as the lessor’s performance of the duty to return the deposit to the lessee or the lessor’s actual performance of the duty to return the deposit, the lessee’s possession of the above building cannot be deemed as an illegal possession, and therefore, the lessee has no liability to compensate for damages.

[4] Where a lease contract is terminated, the lessee is obligated to restore the leased object to its original condition and return it to the lessor. For this reason, if the lessee is to do so by ordinary methods and make profits from the leased object, it is unnecessary to return it as it is, even if it comes to fall short of the current condition at the time the lessee starts using it, and there is no reason attributable to the lessee with respect to the ordinary wear and tear, which means the aggravation of the condition or the decrease in value of the leased object arising after the lessee’s ordinary use, and thus, the cost of restitution should be borne by the lessor unless otherwise stipulated in the general principles of the Credit Act. In other words, the lease contract aims to use the leased object and pay rent for it. The occurrence of the wear and tear of the leased object is naturally planned in light of the nature of the contract that the lessee is the lessee. In addition, if the lessee is clearly aware of the lessee’s ordinary wear and tear of the leased object that the lessee would normally have used it, or if so, it is not clear that the lessee would have to bear the contractual burden such as depreciation costs or repair charges.

[5] Damage suffered by a lessor due to a delay in the duty to restore the lessee upon the termination of the lease is not equivalent to the rent from the date of the delay of the lease until the date when the lessor actually completed the restoration, but the amount equivalent to the rent from the date when the lessor could recover

[1] Articles 618 and 623 of the Civil Act / [2] Articles 618 and 741 of the Civil Act / [3] Articles 536 and 618 of the Civil Act / [4] Articles 615 and 654 of the Civil Act / [5] Articles 393, 615, and 654 of the Civil Act

[2] [3] Supreme Court Decision 91Da35823 delivered on May 12, 1992 (Gong1992, 1840) / [2] Supreme Court Decision 94Da50526 delivered on March 28, 1995 (Gong195Sang, 1747) / [3] Supreme Court Decision 90Da24076 delivered on December 21, 1990 (Gong1991, 590) / [5] Supreme Court Decision 90Da12035 delivered on October 30, 199 (Gong190, 2406) (Gong200, 263)

Plaintiff (Law Firm Jung, Attorney Lee In-bok, Counsel for plaintiff-appellant)

Defendant Co., Ltd. (Law Firm Hannuri, Attorneys Song-ju et al., Counsel for defendant-appellant)

April 26, 2007

1. The plaintiff (Counterclaim defendant) shall pay to the defendant (Counterclaim plaintiff) 25,954,838 won and 5% per annum from November 23, 2005 to May 31, 2007, and 20% per annum from the next day to the full payment date.

2. All of the Plaintiff-Counterclaim Defendant’s principal claim and the remainder of the Defendant-Counterclaim Plaintiff’s counterclaim are dismissed.

3. The costs of lawsuit are assessed against the Plaintiff (Counterclaim Defendant) and the remainder 2/3 by the Defendant (Counterclaim Plaintiff), respectively, by aggregating the principal lawsuit and the counterclaim.

4. Paragraph 1 can be provisionally executed.

1. Purport of the principal claim

The Defendant (Counterclaim Plaintiff; hereinafter “Defendant”) held that the Plaintiff (Counterclaim Defendant; hereinafter “Plaintiff”) shall pay 25,025,806 won to the Plaintiff (Counterclaim Defendant; hereinafter “Plaintiff”) and the amount equivalent to 20% per annum from January 10, 2006 to the date of full payment.

2. Claim for a counterclaim

The decision that the plaintiff shall pay to the defendant 120,584,400 won and 89,784,000 won among them to the defendant from November 22, 2005; the remaining 30,800,000 won from December 1, 2005 to the delivery date of a duplicate of each counter-claim; 5% per annum from the next day to the full payment date; and 20% per annum from the next day to the full payment date.

1. The summary of the case and the common premise of the principal lawsuit and the counterclaim;

A. Case summary

This case is a case where the defendant seeks the return of the lease deposit as a counterclaim when the plaintiff, as a lessor, sought the payment of the unpaid rent, etc. due to the termination of the lease against the defendant, who is the lessee, together with damages due to nonperformance of the duty to restore the lease.

B. Facts of common premise between the principal lawsuit and the counterclaim

In full view of the statements in Gap 1 through 4 and 6, Gap 1 through 4, Gap 7-1 through 8-1, 2-2, the testimony of non-party 1 and non-party 2, and the fact-finding results of this court against non-party 3 corporation, the following facts can be acknowledged.

(1) On March 2, 2005, the Plaintiff entered into a lease agreement between the Defendant (Omission) and the Defendant (around March 2, 2005, under which the Plaintiff would transfer the building in the attached list owned by the Plaintiff to the Defendant via the Plaintiff’s passbook, KRW 150 million in monthly rent, KRW 13 million in monthly rent (the Plaintiff’s passbook on March 20), and the lease term from March 10, 2005 to March 9, 2007; accordingly, the Plaintiff received the lease deposit from the Defendant and delivered the said building to the Defendant.

(2) In concluding a lease agreement, if the lessee has failed to pay the rent continuously more than three times, the lessor may immediately terminate the lease agreement, and the management fee shall be borne by the Defendant, the lessee. In the event that the lease agreement is terminated, the Defendant entered into an agreement with the Plaintiff to reinstate the instant building to its original drawing.

(3) In occupying and using the above building, the Defendant acquired the interior and necessary facilities in the form of an investment in kind, which was established by Nonparty 1, who had been the former lessee, in operating the KND under the mutual name of (mutual omitted) Entertainment.

(4) However, the Plaintiff did not receive the rent from the Defendant from June 21, 2005 and the management fee after April 2005.

(5) On September 5, 2005, the non-party 3 corporation, which was managing a large building due to the Defendant’s failure to pay management expenses, discontinued the supply of electricity and water to the Defendant pursuant to the management rules (Article 9) stipulating that the chief of the management office may suspend the supply of electricity, water, heating, and cooling if the management expenses are not paid for more than two months.

(6) On October 18, 2005, the Plaintiff expressed his intent to terminate the lease contract by content-certified mail on the grounds of the Defendant’s delinquency in rent and management expenses, and the declaration of intention reached the Defendant on October 19, 2005.

(7) On November 22, 2005, upon the Plaintiff’s application, the execution of the disposition of possession transfer and provisional disposal of the instant building was carried out, and the supply of electricity and water was discontinued and the operation of a private teaching institute is not possible, the Defendant ordered the Plaintiff to transfer the key to the building.

(8) However, the Defendant did not comply with a special contract to restore the leased object to its original state according to the drawing. Accordingly, on December 1, 2005, the Plaintiff paid KRW 30 million to Nonparty 2 as the construction price for the removal and restoration (including value-added tax) of the interior facilities and its restoration work (including the removal and restoration work of the ceiling and floor) on December 1, 2005, the construction period from December 2, 2005 to December 16, 2005, and the Plaintiff paid KRW 30 million as the construction price to Nonparty 2, who completed the construction work on January 9, 2006, after exceeding the scheduled construction period.

(9) In addition, the Plaintiff agreed to settle the overdue management expenses during the period from April 2005 to the evictioning period, and paid on December 27, 2005 to the new bank account of Nonparty 3, a company managing the instant building in lieu of the Defendant.

2. Determination on the main claim

A. As to the claim for overdue rent, unjust enrichment equivalent to the rent, or damages

(1) The plaintiff asserts that since the defendant was occupying and using the building owned by the plaintiff from June 21, 2005 to January 9, 2006, which had been completed the restoration to its original state from June 21, 2005, the defendant is obligated to pay to the plaintiff the amount of unjust enrichment or damages equivalent to the rent or rent for the pertinent period, which is the sum of 95,025,806 won (=1,43 million won x (6+20/31).

According to the facts acknowledged above, the lease contract between the plaintiff and the defendant was terminated as of October 19, 2005 upon the plaintiff's declaration of termination on the ground that the amount of the rent in arrears between the plaintiff and the defendant has reached the three-year rent in arrears. Therefore, the defendant is obligated to pay the overdue rent of 56,738,710 won from June 21, 2005 to October 19, 2005, which was the end of the lease.

On the other hand, the defendant asserts that since September 5, 2005, the plaintiff was not obligated to pay rent after suspending the supply of electricity and water for the leased object since the suspension of the supply of electricity and water for the leased object.

A lessor’s duty to use and make profits from an object in accordance with the original purpose of a lease is equal to the lessee’s duty to pay rent. Therefore, in a case where a lessor is unable to use the object at all due to his/her failure to perform the duty to repair the object, the lessee may refuse to pay the entire rent. However, if the Defendant was unable to use and make profits from the building of this case due to suspension of the supply of electricity and waterworks, it is not because the Plaintiff, a lessor, failed to perform his/her duty to allow the lessee to use and make profits from the building of this case in conformity with the original purpose of the lease. As seen earlier, the Defendant’s assertion is unacceptable.

(2) The Plaintiff asserts that, after the termination of the instant lease agreement, the Plaintiff is obligated to pay the Defendant the unjust enrichment or the amount of damages equivalent to the rent from October 20, 2005 to January 9, 2006, the construction of restoration to the original state of the instant building from October 20, 205.

However, the benefit in return of unjust enrichment on the ground that a lessee benefits without any legal ground refers to the substantial benefit. Thus, in a case where a lessee continues to possess the leased building portion even after the lease contract relationship has ceased to exist, but no substantial benefit has been gained due to the lessee’s failure to use it or make profit in accordance with the original purpose of the lease contract, the lessee’s obligation to return unjust enrichment does not accrue (see Supreme Court Decisions 91Da35823, May 12, 1992; 94Da50526, March 28, 1995, etc.). Further, since the lessee’s obligation to return the leased object following the termination of the lease contract and the remaining obligation to return the lease deposit, the lessor’s obligation to return the above deposit was concurrently performed, or the lessee’s obligation to specify the building was lost on the ground that the lessee’s failure to perform his/her duty to perform the lease contract was caused by the lessor’s failure to do so, it cannot be deemed as an unlawful possession of the lessee.

In this case, the fact that the defendant occupied the building of this case from October 20, 2005 to November 22, 2005 that the lease of this case terminated. However, there is no evidence to acknowledge that the defendant actually used or profit from the building of this case after October 20, 2005 that the lease of this case terminated (in fact, it seems that the defendant could not use or profit from the building of this case due to the short-term or short-term measures after September 5, 2005). Further, there is no evidence to prove that the defendant performed the duty to return the lease deposit after deducting the overdue rent from the plaintiff or provided it. Thus, the defendant cannot be said to have a duty to pay unjust enrichment or damages equivalent to the rent after October 20, 205 merely because the defendant occupied the building of this case after the termination of the lease of this case.

B. As to the claim for damages equivalent to the cost of restoration and the fee during the period of restoration

(1) The Plaintiff asserts that the Defendant is liable to pay the Plaintiff the construction cost of KRW 30 million incurred for the restoration to its original state, as damages incurred by nonperformance of the duty to restore the building of this case to its original state.

However, in the event that a lease contract is terminated, the lessor is obligated to restore the leased object to its original condition and return it to the lessor. For this reason, a lessor is obligated to restore the leased object to its original condition by means of ordinary methods, even if it comes to fall short of the current condition at the time when the lessee commences the use of the leased object. As such, no reason exists for the lessee with respect to the ordinary wear and tear, which refer to the aggravation of the condition or the decrease in value of the leased object arising after the lessee’s ordinary use, and thus, the cost of restitution should be borne by the lessor unless otherwise stipulated in the general principles of the law of claims. In other words, a lease contract is the content of the lessee’s use of the leased object and the payment of rent in consideration thereof, and the occurrence of the wear and tear of the leased object is naturally planned in light of the nature of the contract that the lessee is the lessee. Therefore, in a lease contract of a building, it is necessary to clearly interpret that the lessee is obliged to perform the duty of restitution by clearly stating the lessee’s contractual burden such as depreciation costs or depreciation costs.

In this case, whether a special agreement that the Defendant, the lessee, bears the duty of restitution is effective and the scope of the Defendant’s restitution is to be concluded. The Defendant agreed to restore the instant building to its original design drawing upon the termination of the lease agreement with the Plaintiff at the time of the conclusion of the lease agreement with the Plaintiff. As seen earlier, the Plaintiff’s failure to perform the said agreement after the termination of the lease, which led to the restoration of the building to its original state and the Plaintiff’s construction cost of KRW 30 million was paid.

However, according to the statement in Gap evidence No. 2, the lease agreement between the plaintiff and the defendant is stipulated in the special agreement that only "the tenant shall restore to its original state in the 10th floor floor of the building that has been retired." Therefore, it is difficult to view that the entries in the special agreement for restoration alone specifically stipulate the special agreement for the repair of a mother. Therefore, the above lease agreement does not expressly stipulate the contents of the finger mother, which the lessee bears necessary expenses for the establishment of the special agreement for the repair of a mother. In addition, there is no document clearly explaining the terms of the special agreement for the repair of a woman who is the lessee at the time of the conclusion of the lease agreement. Thus, the defendant cannot be said to have recognized the special agreement for the repair of a woman who is the lessee at the time of the conclusion of the lease agreement, and therefore, it cannot be said that the agreement was concluded on the special agreement that imposes the repair expense on the lessee, who is the lessee.

In light of the above circumstances, the construction cost incurred by the Plaintiff for the restoration of the building to its original state does not bear the repair cost, and thus, the Defendant does not bear the repair cost. Therefore, it is reasonable to view the part corresponding to the ordinary fingers, in light of the written estimate, which is a part of the evidence No. 7-1, as KRW 15 million, as damages for nonperformance of the duty to restore to its original state, the Defendant is obligated to pay the Plaintiff KRW 15 million out of the cost of restoration to its original state.

(2) In addition, even after November 22, 2005, which can be deemed to have been occupied and used until January 9, 2006, by which the Defendant transferred the key of the instant building to the Plaintiff, and ordered the Plaintiff to remove the instant building. Thus, the Plaintiff’s assertion that the Plaintiff is obligated to return the rent or unjust enrichment equivalent to the rent during the said period is deemed to include the purport of seeking damages equivalent to the rent during the said period due to the Defendant’s nonperformance of the duty to restore the said building. Therefore, this is examined as to this point.

However, the damage suffered by a lessor due to a delay in the duty to restore the lessee upon the termination of the lease is not equivalent to the rent from the date of delay until the date when the lessor actually completed the duty to restore the lease, but equivalent to the rent from the date when the lessor was able to restore the lease to its original state (see, e.g., Supreme Court Decisions 90Meu12035, Oct. 30, 1990; 97Da15104, Dec. 21, 199).

According to the testimony of Nonparty 2 and Nonparty 2, the date on which the Plaintiff completed the restoration of the object of lease on January 9, 2006. However, the original scheduled period of construction was 15 days from December 2, 2005 to December 16, 2005, and the main contents of the construction are also deemed not to require a long construction period as removal works, floor and ceiling construction for restoration, and the construction starts from the agreed commencement date of construction, and the actual construction starts by January 9, 2006 after the scheduled completion date of construction period was just a supplement of the defective parts at the Plaintiff’s request.

In addition to such circumstances, although the period required for the restoration of the building leased by the Defendant is different according to the contents and degree of the facility installed by the lessee, there is no specific assertion and proof from both the Plaintiff and the Defendant as to the period during which the Plaintiff, a lessor, was able to restore to the original state in light of the above construction contents and the degree of such construction, it is reasonable to deem that the period does not exceed five days even long. Therefore, as damages for nonperformance to the Plaintiff, the Defendant is liable to pay the Plaintiff the amount equivalent to five days rent for the instant building (i.e., KRW 1,43 million x 5/31).

(c) Claims for indemnity equivalent to the overdue management expenses.

The plaintiff asserts that the defendant is liable to pay to the plaintiff the amount of KRW 50 million as compensation liability for the management expenses subrogated by the plaintiff due to the defendant's delinquency.

The Defendant agreed with the Plaintiff that the Defendant should bear the management expenses at the time of concluding the lease contract, and the Plaintiff did not pay the management expenses from April 2005 to April 2005, and the Plaintiff paid the management expenses of the building in arrears to the management office of the building of the building of the building of the case where the Defendant paid the management expenses of the building of the building of the case in lieu of the Defendant. Accordingly, the Defendant is obliged to pay the overdue management expenses of KRW 50 million to the Plaintiff.

The defendant asserts that since September 5, 2005, the building could not be used or profit-making due to the suspension of the supply of electricity and water from September 5, 2005, the management fees imposed thereafter do not have an obligation to pay them.

However, the defendant's failure to use or profit from the building due to the suspension of the supply of electricity and water is due to the delay of management expenses of the defendant as seen earlier, as well as the defendant's obligation to pay management expenses is not attributable to the actual use of the building, but according to the management expenses payment agreement under the lease contract, and therefore the above argument is groundless

D. Conclusion on the principal lawsuit

Therefore, according to a lease agreement between the Plaintiff and the Defendant, the Defendant’s obligation owed by the Defendant to the Plaintiff is KRW 56,738,710, and KRW 17,306,452 due to nonperformance of duty to restore the obligation to restore the damages (= KRW 15,00,000 + KRW 2,306,452), and KRW 50,000,000, and KRW 124,045,162 (=56,738,710 + + KRW 17,306,452 + KRW 50,000).

However, the Plaintiff asserts that the above debt amount against the Defendant should be deducted from the equal amount because all of the above debt amount against the Defendant is secured by the obligation to return the lease deposit. Therefore, the Plaintiff’s claim against the Defendant is without any balance arising from the full deduction. Therefore, the Plaintiff’s claim on the premise that the total amount of the Plaintiff’s claim, such as rent, against the Defendant exceeds the obligation to return the lease deposit

3. Judgment on the counterclaim

A. As to the claim for refund of lease deposit

The defendant asserts that since the lease contract between the plaintiff and the plaintiff is terminated, and on November 22, 2005, the plaintiff ordered the object of lease to be restored to its original state, the plaintiff is obligated to pay 89,784,400 won for the remainder of lease deposit and its delay damages, deducting 24,465,600 won for overdue rent from June 21, 2005 to September 5, 2005 when the plaintiff was unable to use and profit from the building due to the suspension of electricity and water supply.

As seen earlier, since the lease contract between the Plaintiff and the Defendant was lawfully terminated on October 19, 2005, the Plaintiff is obligated to return to its original state, if any, any balance remains after deducting all the Defendant’s obligations owed to the Plaintiff in relation to the lease contract of this case from the amount of KRW 150 million to the order of the object of lease.

Furthermore, I examine the amount of lease deposit to be refunded.

As seen above, in the judgment on this lawsuit, the lease deposit amount of KRW 150 million from June 21, 2005 to October 19, 2005 to KRW 56,738,710, damages of KRW 17,306,452, damages of KRW 5,000,000 due to non-performance of duty to restore, and KRW 124,045,838,000 (=150,000,000-56,738,710-17,306,452-50,000,000) must be deducted from the total amount of KRW 124,045,838,00,000, the lease deposit amount to be paid to the defendant is 25,954,838,000.

B. As to the claim for damages

The defendant asserts that the plaintiff could not operate a postponed school operated by the defendant on September 5, 2005 due to the suspension of the supply of electricity and tap water at will on September 5, 2005. Accordingly, since the students of a private teaching institute demand a refund of tuition fees and the defendant incurred a loss from refund of tuition fees of KRW 30,800,000 to them, the plaintiff is liable to pay 30,800,000 as compensation for damages and losses for delay.

However, according to the management rules of the large-type building management office that manages the building of this case, the management office may suspend the supply of electricity, water, cooling and heating if management expenses are not paid for more than two months, and the defendant delayed the management expenses for the building of this case from April 2005 to September 5, 2005, and the large-type building management office discontinued the supply of electricity and water on the ground of the defendant's delinquency in the management expenses for the building of this case. In addition, there is no evidence to prove that the plaintiff discontinued the supply of electricity and water to the building that is directly leased object, and even if the supply of electricity and water was discontinued at the request of the management office, the above argument by the defendant on the premise that the suspension of the supply of electricity and water supply for the leased object constitutes a default on the part of the plaintiff or a tort is without merit.

C. Conclusion of the counterclaim claim

Thus, the plaintiff is obligated to pay to the defendant 25,954,838 won in the balance of the lease deposit and damages for delay at the rate of 20% per annum under the Civil Act until May 31, 2007, which is the date following the date of the order to specify the building of this case, which is deemed reasonable for the defendant to dispute about the existence or scope of the obligation to perform as of November 23, 2005.

4. Conclusion

Therefore, the defendant's counterclaim claim is accepted within the scope of the above recognition, and all of the plaintiff's main claim and the defendant's remaining counterclaim are dismissed as it is without merit.

[Attachment] List of Real Estate: omitted

Judges Lee Dong-sung(Presiding Judge)