EsP Corporation (Law Firm Apex, Attorneys Park Jong-soo et al., Counsel for the plaintiff-appellant)

The head of Seocho-gu (Attorney Cho Jae-woo, Counsel for defendant-appellant)

May 15, 2014

1. The Defendant’s imposition of waste disposal facility installation charges of KRW 15,081,672,00 against the Plaintiff on May 2, 2013, which exceeds KRW 3,047,382,00, shall be revoked.

2. The costs of the lawsuit are assessed against the defendant.

The same shall apply to the order.

1. Basic facts

A. The Plaintiff is a project implementer that implements a project to create the Bogeumjari Housing District in Seocho-gu Seoul Metropolitan Government (hereinafter “instant project district”) in accordance with the “Special Act on the Construction of Bogeumjari Housing, etc.” in the Seocho-gu, Seocho-gu, Seoul, the identity Dong, the Saltdong, and the Won-dong Nowon-do Seoul Metropolitan Government Seoul Metropolitan Government (hereinafter “instant project district”).

B. The area of the instant project district is at least 300,000 square meters, and the Plaintiff is obligated to pay to the head of the local government the amount equivalent to the installation cost of waste disposal facilities or the cost of installing waste disposal facilities to treat wastes generated from the instant project district pursuant to Article 6(1) of the Act on Promotion of Installation of Waste Disposal Facilities and Assistance, etc. to Adjacent Areas (hereinafter “Act”).

C. On December 5, 2011, the Plaintiff had to pay waste disposal charges without installing waste disposal facilities in the instant business district, and submitted to the Defendant a plan for the payment of waste disposal charges calculated in accordance with the calculation standards of the Seocho-gu Seoul Metropolitan Government Ordinance on the Collection of Expenses for Installation of Waste Disposal Facilities and the Establishment and Operation of Funds (amended by Ordinance No. 794, Mar. 22, 2010; hereinafter “former Ordinance”). The amount to be borne by the Plaintiff was KRW 3,047,382,00,00.

D. On October 4, 2012, the Defendant amended and promulgated the instant municipal ordinance (Ordinance No. 892, hereinafter “the instant new municipal ordinance”) and requested the Plaintiff to revise and submit a plan for the payment of waste disposal facilities in compliance with the calculation standards of the instant new municipal ordinance on October 11, 2012. By applying the instant new municipal ordinance, calculating waste disposal facilities charges is unreasonable, and thus, the Defendant urged the Plaintiff to submit a revised payment plan on several occasions, notwithstanding the Plaintiff’s reply that the supplement of the payment plan is impossible.

E. On March 29, 2013, the Defendant notified the Plaintiff of the scheduled payment of waste disposal charges calculated in accordance with the calculation basis of the instant new Ordinance, and imposed KRW 15,081,672,000 on the waste disposal charges for the instant project district on June 3, 2013 (hereinafter “instant disposition”). The details of the charges are as follows.

Site purchase expenses for 6,269,158,676 food waste disposal facilities installation expenses for 6,357,00 site purchase expenses for 6,357,04,078 aggregate of 15,081,672,754

[Ground of recognition] Facts without dispute, Gap evidence 2 through 4, 6 through 12, and 14 (including each number in case of a tentative number), the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

(1) The instant charges should be assessed by the old Ordinance, not by the new Ordinance, for the following reasons. Thus, the instant disposition imposing waste disposal charges calculated by the new Ordinance is unlawful.

(A) Article 2 of the Addenda to the new Ordinance of this case sets the applicable standards for the new Ordinance as the time of notification of the amount to be paid by the head of the Gu, not the time of submission of a payment plan by the project implementer. Therefore, the application of the new Ordinance is too ambiguous in terms of predictability for the application of the new Ordinance,

(B) The Plaintiff, even before the enactment and enforcement date of the Standard Ordinance of the Minister of Environment, submitted a plan for the payment of waste disposal facilities before the enactment and enforcement date of the Ordinance, and was trusted that the charges would be calculated under the old Ordinance, and thus, the Defendant’s calculation of the instant charges by the new Ordinance later violates the principle of trust protection.

(2) Even if it is reasonable to calculate the instant charges under the new ordinance for household affairs, the instant disposition is unlawful for the following reasons.

(A) Illegal in calculating the expected volume of waste generated per day

The Defendant calculated the total amount of waste generated by the Seocho-gu as a standard group based on the volume of the “2011 nationwide waste generated and disposed of.” ① The foregoing data is in reality impossible to distinguish the volume of waste generated by the disposal facilities based on the volume of waste brought into the disposal facilities, and is not appropriate as the standard volume of waste generated in the same multi-family housing complex as the instant project district as the statistics on various factors, such as multi-use facilities, street waste disposal facilities, offices, stores, restaurants, etc.; ② The Seocho-gu has a large dynamic population as commercial facilities and amusement facilities, and there have been a large number of waste generated due to the mixture of waste generated in the instant project district. However, it is inappropriate to consider the entire Seocho-gu as a sample group on the grounds that there is no significant factor in the occurrence of waste in the instant project district as a residential function centered around the residential function.

(B) Violation of law in the calculation of land purchase cost

① According to the Defendant’s calculation formula of land purchase cost, as long as the daily estimated waste volume is excessively calculated as above, it is inevitable to compute land purchase cost excessively due to an increase in the area of the facility site.

② Although there is no provision on the definition of development cost, which serves as the basis for the unit price for site purchase, the Defendant calculated the development cost by dividing the total project cost, including “direct labor cost, sales cost, general management cost, cost for infrastructure installation cost, capital cost,” which is difficult to be considered as the cost for site purchase, by the area subject to collective supply.

③ Although there is no obligation to pay the Plaintiff the amount equivalent to the installation obligation or installation cost of the residents convenience facilities, the Defendant included the cost of purchasing the site for the convenience facilities of residents in the site according to the new Municipal Ordinance of this case without any legal basis.

(C) Illegality in calculating installation cost

① According to the Defendant’s formula for calculating installation costs of facilities, insofar as the daily volume of wastes expected to occur is excessively calculated as above, the excessive installation costs of facilities are to be calculated.

② Article 4(4) of the Enforcement Decree of the Act provides that the criteria for the unit price per ton of incineration facilities and food waste disposal facilities shall be determined in detail by autonomous Gu. However, the new Municipal Ordinance does not provide for the detailed criteria for the unit price per ton of the installation costs, and the Defendant arbitrarily determined the unit price per ton of the vessel.

(b) Related statutes;

It is as shown in the attached Form.

(c) Fact of recognition;

(1) Circumstances of the instant disposition

(A) On April 27, 2010, the Plaintiff commenced construction of housing site for the instant project on November 30, 201 with the approval of the district plan for the instant project. On December 5, 2011, the Plaintiff submitted to the Defendant a plan for the payment of waste disposal charges calculated in accordance with the calculation standards of the previous Ordinance.

(B) From March 14, 2011 to April 8, 2011, the Board of Audit and Inspection conducted an inspection of actual conditions of business cooperation between agencies, and on September 16, 201, the Board of Audit and Inspection demanded the Minister of Environment to take a disposition of the audit results stating that “The Ministry of Environment, on September 16, 201, issued a request to the Minister of Environment to formulate a plan to specify the standards for calculating the cost of installing waste disposal facilities so as to minimize disputes regarding the cost of installing waste disposal facilities, as the disputes have not been over the appropriateness of the cost of calculating the cost of installing waste disposal facilities, such as promoting administrative litigation against the basic local government in which the Korea Land and Housing Corporation calculates the cost of purchasing waste disposal facilities.” The Minister of Environment enacted and notified “the Standard Ordinance on the Calculation of the cost of installing waste disposal facilities according to the Housing Site Development Business” on June 11, 2

(C) On June 29, 2012, reflecting the above standard municipal ordinance, the Defendant requested the Plaintiff to submit opinions on whether to approve or approve the new municipal ordinance of this case and the reasons therefor, along with a comparison table on the partial amendment of the old municipal ordinance of this case and the new structure thereof. On July 18, 2012, the Plaintiff submitted to the Defendant on July 18, 2012, the following opinions: (a) changing the unit price standards for waste disposal facility site from the “average officially announced price”; (b) changing the unit price standards for waste disposal facility site from the “average announced price”; and (c) adding the unit price standards for

(D) On October 4, 2012, the Defendant amended and promulgated the Ordinance as it was, and requested the Plaintiff to submit a revised plan to the Plaintiff several times from October 2012 to February 2, 2013, the Plaintiff continued to pay the instant charges in accordance with the old Ordinance, which is the ordinance at the time of submission of the payment plan. However, it is reasonable to calculate the instant charges in accordance with the old Ordinance, which is the ordinance at the time of submission of the payment plan, and it is unreasonable to revise the re-preparation plan in accordance with the new Ordinance, which is unclear as to the application of the new and old Ordinance at the time of notification by the head of the Gu.

(E) Ultimately, on March 29, 2013, the Defendant issued a notice of payment of KRW 15,081,672,00 of the waste disposal facility charges calculated pursuant to the instant new Ordinance. On May 2, 2013, the Defendant issued a notice of payment of the waste disposal facility charges of KRW 15,081,672,00 to the Plaintiff on May 2, 2013. The charges for waste disposal facilities constitute the cost of the purchase of the site and the installation cost of the facilities. As regards the cost of the purchase of the site, the former Ordinance and the new Ordinance stipulate different methods of calculating the cost of the purchase of the site, whether the cost of the purchase of the site is included in the area of the site, whether the cost of the neighboring green belt is to be calculated in the area of the site, and the calculation method of the cost of each

(3) The charges calculated by the Defendant by applying the criteria for calculating waste disposal charges as set forth in Articles 5, 5-2, 3, 4, and 1 of the instant new Ordinance are as follows.

(A) Calculation of estimated daily waste amounts in the instant project district;

(2) Seocho-gu population (kg/day) The amount of waste generated per capita (kg/day) the area of the project district in this case. (4) The amount of waste generated per day (kg/day) the planned population of the project district in this case.

*1± (2) = (3), (3)x = (5)

* ① The Seocho-gu quantity of wastes generated in 2011 on the “the current status of the generation and disposal of nationwide wastes in 2011,” and ② the Seocho-gu population in 2011.

(B) Calculation of land purchase costs

(3) Purchase costs of sites shall be 2,354 2,663,194, 269,158,676 food waste facilities,

*1 】 (2) =

* ① The area necessary for the incineration facilities to be established by the Governor of a local government = 2,140 square meters of the area of the incineration facilities site = (=(4.9 metric tons of the daily waste expected to occur x 40 square meters of the necessary site area per ton x x 30 square meters of the daily waste + 330 square meters of the management Dong area + 100/40 of the building-to-land ratio of 330 square meters of the area of the residential convenience facilities) + 214 square meters of the site area of the resident convenience facilities (=

The area necessary for food waste facilities = 2,170 square meters of the site area for food waste facilities = ((5.2 tons of the daily waste expected to have occurred each day, 40 square meters of the necessary site area per x ton + 330 square meters of the management Dong area + 100/40 of the building-to-land area of 330 square meters of the management Dong, etc.) + 217 square meters of the site for convenience and convenience facilities for residents (=2,170 square meters of the area of 2,170 square meters of the residential convenience facilities)

* ② At the Defendant’s request, the current status of the housing site development cost in the instant project district submitted by the Plaintiff on March 8, 2013

(C) Calculation of installation costs

(4) Installation expenses of facilities installation expenses 1,706,670,000 which are 1,20,000 Doz.

*1 】 (2) 】 (4)

* (1) Application of the installation cost of incineration facilities for each ton of the facilities established under the Act on the Establishment and Operation of Facilities for the Retirement of Domestic Wastes by the Ministry of Environment, and the Ministry of Environment’s Guidelines for Subsidization of Government Subsidies and Integrated Work Processing of Waste Disposal Facilities.

Expenses incurred in installing food waste facilities to a ton of the Ministry of Environment shall be applied to the expenses incurred in installing food waste treatment facilities of a scale of 30 tons/day under the "Guidelines for Subsidization of Government Subsidies and Integrated Business Management".

[Ground of recognition] Facts without dispute, Gap evidence Nos. 1 through 4, 6 through 12, 14, Eul evidence Nos. 1, 2, 4 and 5 (including each number), and the purport of the whole pleadings

D. Determination

(1) Determination of ordinances to be applied to the calculation of the instant charges

(a) Obligations of developers and administrative agencies in connection with the installation of waste disposal facilities;

Article 6(1) of the Act provides that a housing site developer shall be obligated to install waste disposal facilities or pay an amount equivalent to the installation cost to the head of the Si, etc. having jurisdiction over the relevant area. Article 4(5) of the Enforcement Decree of the Act provides that “A person who intends to reduce the amount to be paid without installing waste disposal facilities shall submit the payment plan to the relevant market, etc. before the commencement of the relevant development project, and the market, etc. in receipt of the payment plan shall confirm the appropriateness thereof and notify

The purpose of the above provision is to ensure that an administrative agency which shall install waste disposal facilities on behalf of a developer can complete the waste disposal facilities on a timely basis by raising funds necessary for installation of waste disposal facilities, and from the standpoint of the developer, there is a need to estimate and prepare the expenses to be incurred prior to the implementation of the project, the pertinent administrative agency is obligated to review the appropriateness of the payment plan from the time of receiving the payment plan from the developer and to notify the developer by determining the amount to be paid and the time limit. The reasonable time limit is reasonable after examining whether the details of the waste disposal facilities charges under the payment plan submitted by the relevant administrative agency are properly calculated on the basis of the calculation standards for the charges in place at the time of receiving the payment plan.

(B) Interpretation of the supplementary provision of this case

On the other hand, Article 2 of the Addenda to the new Ordinance of this case (hereinafter “the Addenda provision of this case”) provides that “this Ordinance shall not apply where a project operator has already submitted a payment plan before the enforcement date of this Ordinance and the head of the Gu has confirmed the appropriateness thereof and notified the project operator of the amount to be paid, etc.

① The supplementary provision of this case needs to be interpreted harmoniously with the above provision of the Enforcement Decree of the Act, which imposes the pertinent administrative agency the duty to review and notify the payment plan. ② If the supplementary provision of this case provides that “If the new ordinance of this case does not exist until the time of submission of the payment plan and its subsequent expiration, the new ordinance of this case should be applied unless the head of the Gu confirms and notifies the payment amount, etc., regardless of the time of submission of the payment plan and the subsequent expiration, the new ordinance of this case should be applied.” Even if the new ordinance of this case was amended and enforced without any measure, the new ordinance of this case would be applied even if the new ordinance of this case would be applied even if the period of submission of the payment plan of this case would be sufficient time for the project operator to determine and notify the payment amount, etc. under the new ordinance of this case to the head of the Gu, and if the new ordinance of this case would be applied within the period of application of the new ordinance of this case, the new rule of this case would not be applied to the new ordinance of this case.”

Therefore, the supplementary provision of this case should be construed as not only where a project operator submits a payment plan at the time of the enforcement of the new Ordinance and actually notifies the project operator of the payment amount, etc. after confirming the propriety of the plan, but also where the head of the Gu fails to confirm the appropriateness of the payment amount, etc. and notify the project operator of the payment amount, the supplementary provision of this case should be interpreted as follows: “The case where a reasonable period for determining the amount of the charges has elapsed by examining whether the details of waste disposal charges under the payment plan submitted by the head of the Gu from the date of submission of the payment plan were properly calculated based on the calculation standards of charges under

(C) Ordinance to be applied to the calculation of the instant charges

In this case, on December 5, 201, the Plaintiff submitted a plan for the payment of waste disposal facilities charges calculated in accordance with the criteria under the former Ordinance, and the new Ordinance promulgated and enforced on October 4, 2012 after ten months from the date of the submission of the Plaintiff’s payment plan. As seen earlier, the Defendant had a sufficient time to examine whether the details of waste disposal charges under the payment plan submitted by the Plaintiff were properly calculated in accordance with the criteria for calculation of charges under the former Ordinance from the date of the submission of the Plaintiff’s payment plan to the date of the enforcement of the new Ordinance, and to notify the Plaintiff of the amount to be paid and the deadline. Thus, even if there was no notification of the Defendant’s amount to be paid at the time of the enforcement of the new Ordinance, it is reasonable to view that the disposition of this case should be governed by the previous Ordinance, not the new Ordinance.

[This case's new Ordinance was issued by the Board of Audit and Inspection to the effect that it was impossible to review whether it was appropriate under the previous Ordinance until the new Ordinance was implemented. However, as seen earlier, the Board of Audit and Inspection requested the Minister of Environment to take measures to specify the standards for calculating site purchase costs among the expenses for installing waste disposal facilities, and did not order the defendant not to review the payment plan submitted to the Minister of Environment and notify the amount to the Minister of Environment of the appropriateness under the previous Ordinance. Further, the time when the Ministry of Environment enacted the standard ordinance which separately provides for the standards for calculating waste disposal expenses at the above request of the Board of Environment and notified the defendant to the defendant, was six months after the date when the plaintiff submitted the above payment plan. The request for disposition by the Board of Audit and Inspection and the enactment of the standard ordinance by the Ministry of Environment was made on June 2012, which was six months after the date when the plaintiff submitted the above payment plan, and there was no justifiable ground for the defendant's failure to review the payment plan for the period of ten months before the enforcement date of the new Ordinance.]

(2) The illegality of the instant disposition

Thus, the disposition of this case imposing waste disposal charges calculated by the new Ordinance, not the old Ordinance, is unlawful without any further determination on the remaining arguments of the plaintiff.

(3) Scope of revocation

With regard to the scope of revocation, the evidence submitted by the parties or the evidence presented by the court by the examination of evidence cannot be calculated in detail in accordance with the old Ordinance, and thus, the disposition in this case cannot be revoked in full. However, in this case, the plaintiff only seeks revocation of the part exceeding KRW 3,047,382,00 among the disposition in this case, and it cannot be ordered to revoke the disposition in excess of the scope sought by the plaintiff in accordance with the disposition authority principle. Thus, it shall be revoked to the extent that the plaintiff seeks revocation.

3. Conclusion

Therefore, the plaintiff's claim is reasonable, and it is so decided as per Disposition.

[Attachment]

Judges Lee Jae-soo (Presiding Judge)