1. The contract to establish a mortgage between the Defendant and C on August 20, 2015 regarding each of the real estates listed in the separate sheet.

1. Basic facts

A. On June 25, 2009, the Plaintiff lent KRW 652 million to C, which was not repaid, and thereafter filed a lawsuit against C as the Suwon District Court Ansan Branch 2014Ga10571.

On August 27, 2015, the above court rendered a judgment in favor of the Plaintiff that “C shall pay to the Plaintiff KRW 1,124,000,000 and KRW 652,00,000,00,00,000, which is calculated at the rate of 22% per annum from October 2, 2014 to the date of full payment.” The above judgment became final and conclusive on July 19, 2016 through the appellate court (Seoul High Court 2015Na205319).

B. On August 20, 2015, the Plaintiff concluded a mortgage agreement with the Defendant with a maximum debt amount of KRW 500 million (hereinafter “mortgage agreement”) regarding each of the instant real estates as joint collateral with regard to each of the instant real estates indicated in the separate sheet (hereinafter “each of the instant real estates”), and completed the registration of creation of mortgage near the same day.

C. On September 18, 2015, the procedure for compulsory auction (hereinafter “instant auction procedure”) was initiated on September 18, 2015 with respect to each of the instant real estate as Suwon District Court D. At the said auction procedure, each of the instant real estate was appraised at KRW 1,229,708,300, but was sold at KRW 1,73,000.

[Reasons for Recognition] Unsatisfy Facts, Gap evidence Nos. 1, 2, 5, 6, and 7 (including each number; hereinafter the same shall apply), the purport of the whole pleadings

2. Determination on the defense prior to the merits

A. As to the instant lawsuit seeking revocation of the instant mortgage contract between the Defendant and C, the Defendant asserts that there was no benefit in the lawsuit, since each of the instant real estate was sold and the instant mortgage was already cancelled due to the process of the instant auction procedure.

B. We examine the case, even if the establishment of mortgage contract was cancelled due to auction, the mortgagee should be distributed as a mortgagee even if the establishment of mortgage contract was cancelled due to auction.