The purport of limiting the object subject to commercial lien to “goods owned by the debtor”, and whether the commercial lien may be set up against the buyer who acquired the real estate in the procedure of voluntary auction based on the preceding mortgage, where the creditor’s commercial lien has already been set up with respect to the real estate owned by the debtor (negative)

Article 58 of the Commercial Act, Article 320(1) of the Civil Act

Supreme Court Decision 2010Da57350 Decided February 28, 2013 (Gong2013Sang, 539)

U&S Specialized Company (Law Firm Law Firm, Attorneys Park Ho-seok et al., Counsel for the plaintiff-appellant)

Defendant

Seoul High Court Decision 2012Na16997 decided September 19, 2012

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

The grounds of appeal are examined.

Unlike civil lien, it is not necessary that the secured claim has occurred with respect to the subject matter, but the subject matter of the lien is limited to the ownership of the debtor (see Article 58 of the Commercial Act and Article 320(1) of the Civil Act). The purport of limiting the subject matter of the commercial lien to the “subject matter owned by the debtor” is that in case of the commercial lien, the secured claim does not have the nature of public interest expenses for the subject matter because the relationship between the subject matter and the secured claim is mitigated, so the secured claim may be unlimitedly extended to all commercial claims arising between the lien holder and the debtor. Accordingly, it is likely that the secured claim might already infringe on the right secured with respect to the subject matter by a third party, and thus, it may be deemed that the scope of the establishment of the commercial lien or the right secured with respect to the subject matter is limited to the subject matter owned by the debtor. In other words, it shall be limited to the subject matter already established by the debtor at the time of establishment of the existing limited real right by the creditor, and if so, it shall not be viewed that the secured real right has already been established by the debtor.

According to the reasoning of the judgment below, on September 2, 2009, Korea Joint Aid Machinery Co., Ltd. (hereinafter "Korea Joint Aid Machinery Co., Ltd.") completed the registration of establishment near the National Agricultural Cooperative Federation on the instant real estate for the guarantee of loans to the National Agricultural Cooperative Federation. The Defendant supplied goods to the Korea Joint Aid Machinery from January 1, 2009 to May 31, 2010. The price of the goods which was not paid was 257,469,735. The Defendant leased the whole factory of the instant real estate from the Korea Joint Aid Machinery Co., Ltd. on January 25, 2010 (hereinafter "factory of this case"), and received the instant factory from the Korea Joint Aid Machinery Co., Ltd., Ltd., (hereinafter "Korea Joint Aid Machinery"), the National Agricultural Cooperative Federation occupied the factory of this case while producing a cooling tower, etc. on the instant real estate at the auction procedure from the Korea Joint Aid Machinery Co. 2, Ltd., Ltd., which had commenced the auction procedure of this case on May 17, 2010197.

In light of the above facts in light of the legal principles as seen earlier, in order to establish the commercial lien as to the factory of this case, the requirements for the occurrence of the secured debt and the requirements for the possession of the factory of this case must be met, and in order to oppose the Plaintiff, a mortgagee, the time when the commercial lien was established should be earlier than the time when the mortgage was established. However, in order to oppose the Plaintiff, a mortgagee, who has the claim for the payment of goods against Korean public assistance machinery, the Defendant’s commencement of the occupation of the factory of this case on January 2010, which was after the completion of the establishment registration of the neighboring mortgage on the real estate of this case, was around January 201, the date when the Plaintiff possessed the factory

Nevertheless, the court below decided against the plaintiff that the defendant can oppose the factory of this case as commercial lien. In so doing, it erred by misapprehending the legal principles as to the scope of opposition against commercial lien, thereby affecting the conclusion of the judgment. The ground of appeal assigning this error is with merit.

Therefore, without examining the remaining grounds of appeal by the Plaintiff, the lower judgment is reversed, and the case is remanded to the lower court for further proceedings consistent with this Opinion. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Kim Yong-deok (Presiding Justice)