[1] Whether a project operator, who has obtained approval of a project plan pursuant to Article 16 (2) 1 of the former Housing Act, shall take effect in the approval of a project plan before reaching the landowner in order to hold consultation under Article 18-2 (1) of the same Act with the owner of a site subject to request for sale (affirmative)

[2] The time when the approval of a project plan under Article 16 of the former Housing Act takes effect

[1] Article 18-2(1) of the former Housing Act (amended by Act No. 11243, Jan. 26, 2012) provides, “A project operator who has obtained approval of a project plan pursuant to Article 16(2)1 may request the owner of a site (including buildings; hereafter the same shall apply in this Article and Article 18-3) who has failed to secure a title to use the site among the relevant housing construction sites according to the following subparagraphs to sell the site at market price. In such cases, a consultation shall be held with the owner of the site subject to a request for sale for sale for at least three months before filing a request for sale.” However, in order for a project operator to hold a legitimate consultation pursuant to the said provision on the premise that the project operator is in a position to claim the validity of the approval of a project plan for the site subject to a request for sale, at least in order to be recognized as a legitimate consultation pursuant to the said provision, the project operator shall become effective as the owner of the site subject to a request for sale becomes effective before the project approval becomes effective:

[2] The proviso to Article 8(2) of the former Management Regulations (wholly amended by Presidential Decree No. 23383, Dec. 21, 2011; hereinafter “former Housing Act”) that apply to the management of affairs of central administrative agencies and their affiliated agencies, local government agencies and military agencies shall take effect on the date on which five days elapse after the public announcement or public announcement was made, except as otherwise expressly provided in the public announcement document. Article 16(1) of the former Housing Act (amended by Act No. 11243, Jan. 26, 2012; hereinafter “former Housing Act”) provides that the Minister of Land, Transport and Maritime Affairs, the Mayor/Do Governor, and the head of Si/Gun shall determine the person authorized to approve project plans as the person authorized to approve project plans under Article 16(6) of the former Housing Act, and Article 16(6) provides that the person authorized to approve project plans shall give public notice of matters when a project plan has been approved pursuant to paragraph (1).

[1] Articles 16(1) and (2)2, and 18-2(1) of the former Housing Act (Amended by Act No. 11243, Jan. 26, 2012); / [2] Article 16(1) and (6) of the former Housing Act (Amended by Act No. 11243, Jan. 26, 2012); Article 8(2) of the former Regulations on Administrative Affairs (Amended by Presidential Decree No. 23383, Dec. 21, 201; see Article 6(3) of the current Regulations on the Efficient Operation of Administrative Affairs)

[2] Supreme Court Decision 2009Du4913 Decided December 9, 2010

E.S. L.C. (Bae, Kim & Lee LLC, Attorneys Kim Sung-jin et al., Counsel for the plaintiff-appellant)

Defendant 1 and one other (Law Firm Barun, Attorneys Cho Ho-chul et al., Counsel for the defendant-appellant)

Seoul High Court Decision 2012Na2585 decided June 1, 2012

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

The grounds of appeal are examined (to the extent of supplement in case of supplemental appellate briefs not timely filed).

Article 18-2(1) of the former Housing Act (amended by Act No. 11243, Jan. 26, 2012; hereinafter “former Housing Act”) provides that “A project operator who has obtained approval of a project plan pursuant to Article 16(2)1 may request the owner of a site (including buildings; hereafter the same shall apply in this Article and Article 18-3) on which he/she has failed to secure a right to use the site among the relevant housing construction sites according to the following subparagraphs to sell the site at the market price. In such cases, a project operator who has obtained approval of a project plan shall make a consultation with the owner of the site subject to a request for sale at least three months before filing a request for sale from the owner of the site subject to a request for sale.” However, in order for a project operator to obtain legitimate consultation pursuant to Article 16(2)1, consultation with the owner of the site subject to a request for sale should take effect at least before the consultation becomes effective as the project operator’s request for sale:

Meanwhile, the proviso to Article 8(2) of the former Management Regulations (amended by Presidential Decree No. 23383, Dec. 21, 201) that apply to the management of affairs of central administrative agencies, their affiliated agencies, local government agencies, and military agencies (amended by Presidential Decree No. 2383, Dec. 21, 201) provides that, in cases of public announcement documents, the former Housing Act shall enter into force on the date five days elapse after such public announcement is made, except as otherwise provided in the public announcement document. Article 16(1) of the former Housing Act provides that, where a person authorized to approve project plans approves a project plan pursuant to Article 16(6) of the former Housing Act, the Minister of Land, Transport and Maritime Affairs shall determine the person authorized to approve project plans as the Minister of Land, Transport and Maritime Affairs, the Mayor/Do Governor, and the person authorized to approve project plans shall announce the matters thereof. Thus, the validity of the project plan pursuant to Article 16 of the former Housing Act shall enter into force on the date five days elapse

According to the evidence duly admitted, the head of Gangdong-gu Seoul Metropolitan Government may know the fact that the approval of the project plan of this case was publicly announced in the Gu newsletter on June 8, 201. Thus, the approval of the project plan of this case shall have its effect on the Defendants, who are the owners of the land of this case, who were subject to claim for sale only on June 14, 201 after the lapse of five days from the date of public announcement, and the Plaintiff may hold a consultation with the Defendants pursuant to Article 18-2(1) of the former Housing Act from that time. Ultimately, the Plaintiff may exercise the right to claim sale after consultation for more than three months since June 14, 201. As such, the Plaintiff may exercise the right to claim sale after consultation with the Defendants. As the lower court’s decision on September 8, 2011, which was deemed to have been effective, cannot be deemed to have yet been completed since the consultation period for more than three months elapsed, counting from June 14

Nevertheless, the lower court determined otherwise on June 2, 201, that the Plaintiff’s exercise of the Plaintiff’s right to demand sale on September 8, 201 before the expiration of the consultation period of not less than three months, and subsequently rejected the Defendant’s assertion that it is unlawful as the Plaintiff’s exercise of the Plaintiff’s right to demand sale from September 8, 201 was made before the expiration of the consultation period of not less than three months. Therefore, the lower court erred by misapprehending the legal doctrine on the timing at which the project operator, who received approval of the project plan under Article 18-2(1) of the former Housing Act, can legally consult with the owner of the site subject to the claim for sale, thereby adversely affecting the conclusion of the judgment.

Therefore, without further proceeding to decide on the remaining grounds of appeal, 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 Shin Young-chul (Presiding Justice)