Plaintiff (Attorney Doksung et al., Counsel for the plaintiff-appellant)

Jeonju-si (Law Firm Ba, Attorney Kang Young-chul, Counsel for defendant-appellant)

August 10, 2017

Jeonju District Court Decision 2015Kadan29000 Decided September 20, 2016

1. The plaintiff's appeal is dismissed.

2. The costs of appeal shall be borne by the Plaintiff.

The judgment of the first instance shall be revoked. The defendant shall pay the plaintiff 170,000,000 won with 5% per annum from August 24, 2015 to the delivery date of a copy of the complaint of this case, and 20% per annum from the next day to the day of complete payment.

1. Basic facts

(a) Implementation of a project to develop a pedestrian environment and expropriation of land;

1) From July 2009, the Defendant is running a project for urban planning facilities (i.e., 1-1 line and the development of the pedestrian environment) in Jeonju City (hereinafter “instant project”).

2) In order to acquire a road of 547 square meters (hereinafter “instant land”) at the Jeonju-si, Jeonju-si, the Defendant, which was incorporated into the instant project site, filed an application for adjudication of expropriation with the Seoul Special Self-Governing Province Land Expropriation Committee.

3) On June 29, 2015, the said commission rendered a ruling on August 24, 2015 on the date of expropriation (hereinafter “instant compensation”) as “368,678,000 won for the instant land (hereinafter “instant compensation”) and the date of expropriation.”

B. The party to the land of this case

At the time of the above ruling, multiple creditors, including the Plaintiff, completed the following registration as to the instant real estate.

Industrial Bank of Korea 1 Industrial Bank of Korea registration date of creditors of the table contained in the main sentence on April 29, 2009 (the maximum amount of claims KRW 1,140,000,000) 2 Plaintiff 4 January 4, 2011, which was attached on September 16, 201, 3 Jeonju-si, Seoul Special Metropolitan City (the maximum amount of claims KRW 170,000,000) on September 16, 2011, the 4 former Special Self-Governing Province attached on September 20, 2011, which was attached on September 5, 2011.

C. Exercise of rights by interested parties to the claim for payment of the instant compensation

1) The interested parties seized the right to claim the instant compensation as follows.

Industrial Bank of Korea No. 1 Industrial Bank of Korea No. 110,506,752, Sept. 3, 2014, details of the claim amount of the date of seizure and assignment order of creditor No. 1 Industrial Bank of Korea No. 1. 22,435,690, and request for seizure and collection of KRW 80,360, July 7, 2015, 4, the request for seizure and collection of KRW 5,00,00,000, and KRW 170,000,000,000 on July 13, 2015, 2015, and KRW 5,000,000 on July 10, 2015.

2) Accordingly, the Defendant paid KRW 368,678,00 of the instant compensation to the interested parties as follows. The Defendant received the instant seizure and collection order, which was served on August 17, 2015 by the Plaintiff, as the obligee, but did not pay the Plaintiff the Plaintiff, since the Plaintiff was fully paid the instant compensation to other interested parties at the time.

The amount paid by creditors of the table contained in the main sentence shall be KRW 368,678,00,00 in total, KRW 360,00,00 on August 3, 2015, 234.932,200 on August 3, 2015, the sum of KRW 368,678,00,00,000 on July 8, 2015, Seoul Special Metropolitan City:

[Reasons for Recognition] Facts without a partial dispute, entry of Gap evidence 1 through 6 (including a provisional number; hereinafter the same shall apply), entry of Eul evidence 1 to 5, the purport of the whole pleadings

2. Judgment as to the main claim

A. The plaintiff's assertion

The plaintiff received the order of seizure and collection as to KRW 170,00,000 among the claims for the payment of compensation of this case, and as such, the above decision was served on the defendant, the defendant is obligated to pay the amount of KRW 170,000,000 and the delay damages to the plaintiff.

(b) Markets:

1) Relevant legal principles

Article 370 of the Civil Act and the proviso of Article 342 of the Civil Act provide that a mortgagee shall attach money or other things to be paid or delivered by the mortgagee in order to exercise the subrogation right shall maintain the specificity of the claim which is the object of subrogation, preserve its validity, and at the same time refrain from causing any loss to the third party. Therefore, as long as money or other things which are modified objects of the mortgaged object have already been seized by a third party and the money or things have been specified, the mortgagee may exercise the subrogation right and obtain preferential repayment from the ordinary creditor even though he/she did not attach them by himself/herself. However, the method of exercising the right of subrogation is either to submit documents proving the existence of the security right under Article 273 of the Civil Execution Act to the court of execution and submit them to the court of execution for an order of seizure and whole order, or to demand a distribution pursuant to Article 247(1) of the Civil Execution Act. Thus, it is not possible to obtain a preferential reimbursement from the compensation on the land to be expropriated only without going beyond the exercise of such subrogation right (see Supreme Court Decision 20028Da1668, Sept. 28, 20168, 28, 20198.

2) In the instant case:

As seen earlier, before the Plaintiff exercises the subrogation right by means of filing an application for attachment and collection order regarding the instant claim for compensation, other interested parties seized the right to claim compensation of this case and received all compensation from the Defendant. Therefore, the Plaintiff lost the right to preferential payment regarding the instant claim for compensation, and the Plaintiff cannot seek the payment of compensation of this case based on the attachment and collection order, unless there exists no remaining compensation to the Defendant.

Therefore, we cannot accept the plaintiff's primary claim.

3. Judgment on the conjunctive claim

A. The plaintiff's assertion

As follows, the Defendant: (a) deprived the Plaintiff, who is a senior mortgagee, of the opportunity to exercise the subrogation right on the instant claim for the payment of compensation money; (b) accordingly, the Defendant is obliged to pay the Plaintiff the amount of KRW 170,000,000 equivalent to the maximum debt amount of the right to collateral security and the delay

1) The Defendant, while accepting the instant land, failed to implement the consultation procedures prescribed in Articles 16 and 26 of the Act on the Acquisition of Land, etc. for Public Works and the Compensation Therefor, and Article 8 of the Enforcement Decree of the same Act. In particular, the Defendant was negligent in not notifying the Plaintiff of the time, method, procedure, amount, etc. of compensation.

2) The Plaintiff believed, on June 2015, that “the Plaintiff may receive compensation before August 24, 2015, which is the date of expropriation,” through a written adjudication on acceptance received from the Defendant on the first day of August 2015, 2015, but the Defendant paid all of the instant compensation to the relevant persons prior to the date of expropriation, contrary to the Plaintiff’s trust.

(b) Markets:

1) As to the assertion of violation of duty to implement the consultation procedure

Articles 16, 26, and 8 of the Act on the Acquisition of Land, etc. for Public Works and the Compensation Therefor, which are cited by the Plaintiff as the grounds for the duty to implement the procedures of consultation, are provisions concerning the procedures of consultation prior to expropriation adjudication.

Article 16 (Consultation) (1) A project operator who has obtained project approval under Article 20 shall undergo the procedures for the preparation of land and goods protocols, the public announcement, notification and perusal of a compensation plan, the calculation of compensation amount, and the consultation with landowners and persons concerned. In such cases, Articles 14 through 16 and 68 shall apply mutatis mutandis. 16 (Enforcement Decree of the Act on Acquisition of and Compensation for Land, etc. for Public Works Projects) (1) Where a project operator intends to hold consultation under Article 16 of the Act, he/she shall notify landowners and persons concerned of the written request for consultation prescribed by Ordinance of the Ministry of Land, Infrastructure and Transport of the following matters: Provided, That where landowners and persons concerned are unable to know or his/her address, residence or place of notification is unknown, public announcement may be substituted by the consultation period and the method of consultation, the method of consultation, the method of consultation, and the amount of compensation required under paragraph (2).

As seen earlier, the Defendant conducted the consultation procedure to acquire the instant land with Nonparty 1, who is the owner of the instant land, but went into effect as the adjudication procedure for expropriation. Even if the Defendant did not proceed with the consultation procedure with the Plaintiff, which is the party concerned, in the course of the consultation process to acquire the instant land, it is difficult to recognize a proximate causal relationship between the omission of the above consultation procedure and the result that the Plaintiff was not paid the compensation for expropriation, insofar as the agreement was not reached and the notification procedure was conducted accordingly.

Comprehensively taking account of the overall purport of the arguments in evidence Nos. 1, 2, 3, and 5, the Governor of the Jeollabuk-do Regional Land Tribunal requested the Defendant on June 1, 2015. The Defendant, on the same day, published the application form for the adjudication of expropriation and related documents, and sent a public notice informing the Plaintiff and related persons of the fact that such public notice was made, and the Plaintiff received on June 10, 2015. The Defendant served a written adjudication of expropriation, including the Plaintiff, on June 30, 2015. The remaining related persons, other than the Plaintiff, exercised their rights by following the seizure procedure regarding the right to claim the payment of compensation in this case. According to the above acknowledged facts, it is reasonable to deem that the Defendant fulfilled its duty to inform and notify the relevant persons, including the Plaintiff, in accordance with the procedure for payment of the auction adjudication, and there is no detailed provision such as dividends. The Defendant cannot be readily concluded that the public official in charge did not perform any act necessary for the civil petitioner’s purpose or the execution of duties (see Supreme Court Decision 201727Da271671, etc.).

On August 20, 2015, after the Defendant fully paid the instant compensation, the Plaintiff asserted that the Defendant recognized his negligence on the grounds of the official document “information on the exercise of property rights pursuant to confirmation of the date of confinement (Evidence A7),” which was sent to the Plaintiff on August 20, 2015, an interview with the press or press report (Evidence A, 8, 9, and 10) on the part of the Defendant, and the litigation document for the refund of compensation (Evidence A1) against the Republic of Korea.

In full view of the evidence Nos. 10-1 and 2-2 and the purport of the whole pleadings in the testimony of Non-Party 2 of the party witness, the defendant may recognize the fact that the defendant was consulted by various attorneys about the legality of the payment procedure of the compensation of this case according to the plaintiff's civil petition, and as a result, there were many opinions that "the plaintiff has preferential right to payment regarding the right to payment of the compensation of this case". In other words, the defendant seems to have made the above statement or prepared materials to resolve the civil petition smoothly, under the absence of conviction of the legality of the payment procedure of the compensation of this case. However, as seen in Paragraph 2, as long as the preferential right to payment of the compensation of this case can not be acknowledged to the plaintiff, the defendant's negligence cannot be acknowledged on the basis of only

Therefore, this part of the plaintiff's assertion is without merit.

2) As to the assertion of violation of duty to protect trust

A) Circumstances prior to the payment of the instant compensation to interested parties

According to Gap evidence No. 4, the local Land Tribunal of Jeollabuk-do delivered the original written adjudication of expropriation to the plaintiff around June 30, 2015, and sent the official document stating that "if the compensation is not received by the commencement date of expropriation, the compensation is known to the deposit office at the location of the land, etc. and the compensation is deposited."

However, not only the above official document is sent by the defendant, but also the literal interpretation of the above statement does not mean that the defendant promised to not pay compensation until the commencement date of expropriation or to pay compensation until the commencement date of expropriation. According to the evidence No. 4, the above official document can be acknowledged that the above official document carries out the fact that "any inquiry related to the procedure for receiving compensation and the decision of expropriation may be made to the non-party 2, who is a public official under the jurisdiction of the defendant," and the above official document seems to be merely an overall procedural guidance (the plaintiff then asked the defendant about the procedure for paying compensation, and the public official in charge asked the defendant about the procedure for paying compensation, and argued that "the compensation may be paid until the commencement date of expropriation," but it is not sufficient to acknowledge it only by the statement No. 18, and no evidence exists).

Therefore, it is insufficient to view that the defendant granted the plaintiff the trust in the payment of compensation on the basis of the above written statement of official document only, and there is no evidence otherwise.

B) Circumstances after the payment of the instant compensation to relevant persons

According to the statement in Gap evidence No. 7, the defendant, on August 20, 2015, can be acknowledged that the defendant sent a public letter to interested parties, including the plaintiff, stating "the plan to deposit (redistribution) the compensation of this case, and the interested parties sent a public letter to the effect that "the person concerned shall exercise his/her property right by August 24, 2015."

However, in light of the following circumstances, Gap evidence Nos. 7, 10, 11, 17, Eul evidence Nos. 3 and 6, and Eul evidence Nos. 3 and 6, and the testimony of non-party Nos. 2 of the trial court, the above official document appears to be a guidance for exercising property rights in preparation for the case where the defendant was returned the compensation paid to Jeonju Tax Office, and it is difficult to view that the defendant promised the plaintiff to pay the compensation without any conditions.

① On August 20, 2015, when the above official document was created, the Defendant paid the pertinent compensation to the interested parties.

② Under the premise that the Defendant was erroneous in paying compensation for the Jeonju Tax Office, the Defendant was preparing a lawsuit to return compensation to the Republic of Korea (the lawsuit is pending in the final appeal against the Defendant even before the appellate court).

③ In light of the above language and text, the instant compensation is premised on re-distribution.

C) Conclusion

Ultimately, the submitted evidence alone is insufficient to recognize that the Defendant granted the Plaintiff the trust in the payment of compensation, and there is no other evidence to acknowledge it. Therefore, the Plaintiff’s assertion on this part is without merit.

4. Conclusion

If so, all of the plaintiff's main and ancillary claims shall be dismissed as they are without merit. The judgment of the court of first instance is just in conclusion, and the plaintiff's appeal is dismissed as it is without merit.

Judges (Presiding Judge)