[1] In a case where a seller’s obligation to transfer ownership on the subject matter of sale becomes impossible due to a cause attributable to the buyer, whether the buyer can rescind the contract due to such cause (negative)

[2] The case holding that, in a case where the parcelling-out company Gap entered into a limited collateral guarantee contract with Eul as a comprehensive principal debtor, and the buyers did not pay interest on loans to Eul bank, and the parcelling-out company set up a collateral security on the object of parcelling-out for the non-transfer of ownership at the request of Eul bank, but the buyers did not pay the balance of sales, and Eul bank purchased and acquired the ownership of each apartment by a third party during the voluntary auction procedure applied by Eul bank based on the above collateral security, the sales contract cannot be cancelled for the reasons that the buyers failed to perform their obligation to pay the balance of sales and pay interest on loans, on the ground that the sales company Gap's decision making it impossible for the buyers to perform their obligation to pay the balance of sales and pay interest on loans to the buyers

[1] Article 546 of the Civil Code / [2] Article 546 of the Civil Code

[1] Supreme Court Decision 2000Da50497 decided Apr. 26, 2002 (Gong2002Sang, 1243)

Plaintiff 1 and five others (Law Firm Kangsan, Attorneys Han-kon, Counsel for the plaintiff-appellant)

Sung Pung Co., Ltd. (LLC, LLC, Attorneys Oh-hin et al., Counsel for the defendant-appellant)

Daejeon High Court Decision 2009Na6217, 6224 decided April 29, 2010

The judgment of the court below is reversed, and the case is remanded to Daejeon High Court.

We examine the grounds of appeal.

1. The court below held that the defendant's obligation to transfer ownership of each of the instant parcelling-out objects to the National Bank (hereinafter "National Bank"), which is its creditor, was impossible to carry out because the defendant created a collateral on each of the instant parcelling-out objects and sold them to a third party as a result of the auction procedure of this case, and completed ownership transfer registration, and thus, the obligation of the defendant to transfer ownership of each of the instant parcelling-out objects to the plaintiffs who are the buyer according to the instant parcelling-out contract was impossible. Since the performance impossibility was due to the defendant's act, its liability is attributable to the defendant. Thus, unless the plaintiffs expressed their intention to cancel the instant parcelling-out contract on the ground of the above impossibility of performance, the instant parcelling-out contract was lawfully cancelled, and the defendant is obligated to return the down payment, etc

In addition, the court below's assertion that the plaintiffs had no right to rescind the contract of this case because it is attributable to the plaintiffs, even if the above contract of this case was delayed due to the reasons for which the plaintiffs had no right to cancel the contract of this case. However, even if the plaintiffs' remaining payment is delayed, the defendant can not escape from the duty to execute the registration of transfer of ownership as stipulated in the contract of this case. The defendant established the mortgage of this case which could interfere with the plaintiffs' performance of the registration of transfer of ownership under the contract of sale of this case. The defendant did not terminate the contract of this case with the third party because each of the objects of this case was sold in lots and its ownership was transferred to the third party because it did not prevent the execution of the contract of this case, and it cannot be viewed that the defendant did not have any duty to prevent the plaintiffs from executing the above contract of sale of this case because it did not have any right to cancel the contract of this case. It is against the defendant's expectation that the defendant had no right to enforce the contract of sale of this case with the third party as a guarantee contract of this case.

2. However, it is difficult to accept the above determination by the court below in the following respect.

A. In order to cancel a contract for an impossibility of performance, such impossibility must be caused by an obligor’s cause attributable to the obligor (Article 546 of the Civil Act). Therefore, even if a seller’s obligation to transfer ownership on the subject matter of sale and purchase has become impossible, where such impossibility of performance is caused by a buyer’s cause attributable to the buyer, the buyer cannot rescind the contract for such cause attributable to the buyer (see Supreme Court Decision 2000Da50497, Apr. 26, 2002, etc.).

B. Review of the reasoning of the lower judgment and the record reveals the following facts.

(1) On October 1, 2003, the Defendant concluded a sales contract with Nonparty 1, 301, 303, 1008 of the instant apartment to Nonparty 4, 407 of the instant apartment to Nonparty 3, 801 of the instant apartment to Nonparty 4, and 604 of the instant apartment to sell each of the instant apartment to Nonparty 4, respectively (hereinafter collectively referred to as the “instant sales contract”), and received each down payment from each contractor on the day of the contract, and thereafter, Plaintiff 1 entered into the status of the buyer on October 21, 2005, and Plaintiff 2 took the status of the buyer on March 25, 2004, Plaintiff 3 took the status of the buyer on March 23, 2004, and Plaintiff 3 took the status of the seller on March 23, 2004, Plaintiff 20-16, and Plaintiff 3-16, 2008-16, respectively.

(2) According to the instant sales contract, the interest on an intermediate payment loan from the bank is borne by the Defendant until before the date of designation of occupancy notified by the Defendant.

(3) Meanwhile, around March 2004, the Defendant concluded a limited collateral guarantee contract between the National Bank and the National Bank as the principal debtor, and concluded a limited collateral guarantee contract between 130% of each loan of the lending generation as the collateral guarantee amount, and provided that the above collateral guarantee is not effective for the person who succeeded to the status of the lending status by a special agreement.

(4) Upon entering into a loan transaction agreement with a national bank, Nonparty 1 (901), Nonparty 4 (604), Plaintiff 2 (303), Plaintiff 3 (108), Plaintiff 4 (407), and Plaintiff 5 (801) entered into a loan transaction agreement with the national bank and entered into a mortgage agreement with the national bank to acquire the ownership of an apartment unit sold in lots and offer it as a security to the national bank (hereinafter collectively referred to as “the instant loan transaction agreement” and “after-sale security agreement”), respectively, paid an intermediate payment with the loan granted to the national bank. Plaintiff 1 (901), and Plaintiff 6 (604) transferred the status of the purchaser of each unit of the above loans.

(5) Around September 2005, the Defendant obtained approval for the use of the instant apartment, and notified the buyers, including the Plaintiffs, of the scheduled date of occupancy on November 30, 2005, and completed the preservation registration of the instant apartment on November 14, 2005, and paid interest on the instant apartment loan until the scheduled date of occupancy. However, some buyers, including the Plaintiffs, did not pay interest on loans after the scheduled date of occupancy to the National Bank, and filed a lawsuit against the Defendant claiming the return of the sale price on January 24, 2006 against the Defendant for the cancellation of the sale contract ( Daejeon District Court Decision 2006Ga825, Daejeon District Court Decision 2006Ga825), and the Defendant filed a counterclaim against the said buyers for the claim for the sale price unpaid against the said buyers (the Daejeon District Court Decision 2006Ga8508).

On November 9, 2007, the sales contract in this case was maintained, and there was a decision in lieu of conciliation that mainly states that the plaintiffs pay the remaining sales price to the defendant, and the defendant pays 15 million won to the plaintiffs as the compensation for defect repair expenses and damages. However, the above decision became final and conclusive, and the plaintiffs 3 and 5 filed an objection against the above decision, but on January 17, 2008, the above court paid 8,749,264 won to the plaintiffs 3 and 5 for each defect repair expenses and damages, and the defendant paid 105,196,716 won, and the plaintiff 3 paid 118,476,325 won to the defendant as the remaining sales price to the defendant, and the above decision became final and conclusive on February 19 of the same year.

(6) Meanwhile, a national bank, without paying interest on loans as the plaintiffs, paid interest on loans unpaid to buyers who did not complete the registration of ownership transfer, and urged them to complete the registration of ownership transfer for the implementation of the follow-up security agreement, but did not comply therewith, requested the Defendant, the guarantor, to set up a collateral security right on the apartment housing of buyers who did not complete the registration of ownership transfer. Accordingly, on October 17, 2006, the Defendant established a maximum debt amount of 5,741,00,000 won with respect to the object of sale in lots for 37 households prior to the ownership transfer, including the portion of the plaintiffs' purchase in lots, and the debtor’s joint collateral security right (hereinafter “instant collateral security right”).

(7) After that, the plaintiffs did not pay each purchase price finalized in the above lawsuit. Ultimately, in the voluntary auction procedure applied by the National Bank on March 13, 2008 and May 24, 2008 for the right to collateral security of this case, the highest buyer purchased the number of apartment lots from November 25, 2008 to February 10, 2009 and acquired the ownership of each apartment unit.

(8) Meanwhile, with respect to the object of sale by buyers who paid any balance during the instant auction procedure and completed the registration of ownership transfer, a national bank waives joint security and cancelled it from the joint security list, thereby completing the registration of creation of a collateral for the individual's debt.

C. In light of the above facts, even though there was no obstacle for the plaintiffs to acquire the ownership of an apartment unit that was sold from the defendant if they performed the obligation to pay the purchase price in the above lawsuit, the defendant was unable to perform the obligation to pay the purchase price due to the plaintiffs' failure to perform the obligation to pay the purchase price. In addition, in relation to the defendant who jointly and severally guaranteed the debt of this case, the plaintiffs were liable to pay the interest on each debt to the national bank and to provide the apartment unit that was sold in lots as a subsequent mortgage, but failed to perform

On the other hand, the National Bank requested the performance of the guaranteed obligation against the defendant who is a joint and several surety due to the plaintiffs' default, and can enforce compulsory execution against the apartment of this case owned by the defendant. Accordingly, the number of apartment houses sold by the plaintiffs is a property subject to realization if the plaintiffs acquire each ownership of such apartment houses as a security for each obligation to the National Bank, or the National Bank provides a guarantee obligation to the defendant. Therefore, even if the defendant established the right of collateral in this case to the National Bank as a joint and several surety, and the secured obligation is the defendant's joint and several surety obligation, its substance is to guarantee each obligation of the loans of this case, so the right of collateral of this case cannot be said to be unrelated to the obligation of the loans of this case.

Therefore, the decision-making cause for which the Defendant becomes unable to perform the obligation to transfer ownership due to the transfer of ownership by the sale of the apartment unit to a third party is that the Plaintiffs failed to perform their obligation to pay the outstanding purchase price and the obligation to pay interest on the instant loan. Thus, the Defendant’s obligation to transfer ownership is eventually impossible by the reasons attributable to the Plaintiffs. According to the legal principles as seen earlier, the Plaintiffs, who are responsible for the impossibility of performing their obligation, cannot cancel the instant sales contract on the grounds of nonperformance.

Contrary to this, the lower court erred by misapprehending the legal doctrine on the causes attributable to nonperformance, thereby adversely affecting the conclusion of the judgment.

Therefore, the ground of appeal pointing this out is with merit.

3. Therefore, 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 Yang Chang-soo (Presiding Justice)