[1] In a case where the registration of ownership transfer is made on the real estate register, whether the procedure and cause are presumed to be justifiable (affirmative), and in a case where a doubtful circumstance is proven to deem the procedure and cause of the registration to be unfair, whether the presumption capacity of the registration is broken (affirmative)

[2] The meaning and limitation of the principle of free evaluation of evidence declared by Article 202 of the Civil Procedure Act

[3] The case holding that the court below erred by misapprehending the legal principles as to the reversal of the presumption of registration, in case where Gap's creditor Byung corporation received payment in substitutes or sought cancellation on the ground that the registration was made according to the invalid payment in substitutes agreement, even though Gap's creditor Byung corporation did not have a claim against Eul, since Eul's registration of ownership transfer based on payment in substitutes for Eul's real estate, and Gap's creditor Byung corporation received payment in substitutes or obtained a false representation in collusion with Eul

[1] Article 186 of the Civil Act, Articles 202 and 288 of the Civil Procedure Act / [2] Article 202 of the Civil Procedure Act / [3] Article 186 of the Civil Act, Articles 202 and 288 of the Civil Procedure Act

[1] Supreme Court Decision 2001Da72029 Decided February 5, 2002 (Gong2002Sang, 642) Supreme Court Decision 2002Da46256 Decided February 28, 2003 (Gong2003Sang, 916) / [2] Supreme Court Decision 82Meu317 Decided August 24, 1982 (Gong1982, 877) Supreme Court Decision 2006Da28430 Decided July 15, 2010

[Defendant-Appellee] The Korea Development Bank Co., Ltd. (Attorney Kim Jong-hwan, Counsel for defendant-appellee)

Defendant (Attorney Park Byung-soo et al., Counsel for the defendant-appellant)

Gwangju District Court Decision 2015Na11935 Decided June 1, 2016

The judgment below is reversed, and the case is remanded to the Gwangju District Court.

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

1. Review of the reasoning of the lower judgment and the evidence duly admitted by the lower court reveals the following facts.

A. The plaintiff is a corporation established for the purpose of purchasing non-performing loans and managing the assets of purchased bonds. The bankruptcy trustee of Songsung Credit Union (hereinafter "Songsung"), on August 28, 2008, filed a lawsuit against non-party 2, etc. of Gwangju District Court 2008da70829, April 23, 2002 against the non-party 389,767,620, the remaining loans under the loan transaction agreement dated April 23, 2002, seeking the payment of interest and delay damages thereon, and was sentenced for claimant on November 20, 2008. The above judgment became final and conclusive on December 16, 2008. The plaintiff acquired the above loan principal and interest claim against non-party 2 from non-party 1 in the bankruptcy trustee of Songsung-sung case.

B. The defendant had worked in Gangnam-gu Seoul as a company located in Gangnam-gu while living in Seoul, and the non-party 2 lives in Gwangju.

C. On April 19, 2006, Nonparty 2 completed the registration of creation of a neighboring mortgage (hereinafter “instant collateral security”) that caused maximum debt amount to 200 million won with respect to the real estate owned by the Defendant with respect to the real estate of 582 square meters and 1,342 square meters ( Address 1 and 2 omitted) (hereinafter “real estate”) and ( Address 3 omitted) 740 square meters (hereinafter “instant real estate”).

D. On November 1, 2007, Nonparty 2 completed the procedure for the registration of ownership transfer on the instant real estate to the Defendant on November 1, 2007 by the Gwangju District Court No. 193691, Oct. 29, 2007, which was due to the payment in substitutes as of November 1, 2007. Accordingly, the right to collateral security established in the future of the Defendant on the instant real estate was extinguished due to confusion.

E. The letter of performance prepared by Nonparty 2 on November 1, 2007 stating that “The Nonparty 2 terminated the right to collateral security on the instant real estate to borrow and secure KRW 200 million from the Defendant on April 19, 2006, and on October 29, 2007, transferred the instant real estate to the payment in lieu of the above loan amounting to KRW 63 million, which is part of the above loan amount, the other loan amounting to KRW 137 million and interest at KRW 10 million per annum, shall be paid within five years.”

F. On January 24, 2014, the Plaintiff granted an execution clause for succession according to the foregoing Gwangju District Court Decision 2008Gadan70829, and applied for a compulsory auction of real estate as to the real estate ( Address 1, 2 omitted) owned by Nonparty 2 at the Gwangju District Court 2014Ma2080, and filed a lawsuit of demurrer against distribution (hereinafter “instant lawsuit of demurrer against distribution”) with the Gwangju District Court 2014Kahap6324, the Plaintiff raised an objection against the Defendant’s amount of distribution (163,294,686 won) on the date of distribution.

2. Ground of appeal No. 1

A. The registration of ownership transfer in the real estate register shall be presumed to be justifiable and the procedure and cause thereof shall be proved by the party asserting that there is a doubtful reason that the registration procedure and cause are unfair. However, if it is proved that there is a doubtful reason that the registration procedure and cause are unfair, the presumption power is broken (see Supreme Court Decisions 4290Da251, 252, Oct. 21, 1957; 2001Da72029, Feb. 5, 2002; 2002Da46256, Feb. 28, 2003, etc.).

B. The lower court determined that, inasmuch as the Defendant completed the registration of ownership transfer by the Gwangju District Court No. 193691 on November 1, 2007 with respect to the instant real estate, the Plaintiff was liable to prove that the payment agreement on October 29, 2006, which became the cause of registration, was made without the original obligation or was null and void as a false conspiracy. The lower court’s determination is justifiable in accordance with the foregoing legal doctrine. In so doing, the lower court did not err by misapprehending the legal doctrine on the burden

3. Ground of appeal Nos. 2 and 3

A. The principle of free evaluation of evidence, which is declared by Article 202 of the Civil Procedure Act, means that it does not need to be bound by the formal evidence rules, and does not allow a judge’s arbitrary judgment as to the acknowledgement of facts. Therefore, the fact-finding is in accordance with logical and empirical rules based on the ideology of social justice and equity by the evidence duly admitted into evidence, and even if the fact-finding belongs to the discretion of the fact-finding court, it shall not exceed its limit (see, e.g., Supreme Court Decisions 82Da317, Aug. 24, 1982; 2006Da28430, Jul. 15, 2010).

B. The Plaintiff sought cancellation by subrogation of Nonparty 2 on the ground that the registration of ownership transfer in the name of the Defendant was made pursuant to an invalid payment agreement with a payment in substitutes or with a false representation, even though there was no claim against Nonparty 2 by the Defendant.

The lower court dismissed the Plaintiff’s claim on the grounds that there was sufficient evidence to acknowledge the Plaintiff’s assertion only by the submitted evidence, and that there was no other evidence to acknowledge it. The lower court rejected the Plaintiff’s claim on the grounds that there was no other evidence to acknowledge it.

C. However, it is difficult to accept such fact-finding and judgment of the court below. The reasoning of the judgment of the court below, evidence duly adopted by the court below, and records reveal the following circumstances.

(1) Nonparty 3 and Nonparty 4, who are the wife of the Defendant, are the relatives by marriage between the Defendant and Nonparty 2, who are the wife of Nonparty 2.

(2) In the instant lawsuit of demurrer against the distribution, the Defendant did not coincide with the allegation that the Defendant lent KRW 200 million to Nonparty 2 around April 19, 2006 in the written reply from March 30, 2015 regarding the developments leading up to the occurrence of the secured claim of the instant right to collateral security. However, in the briefs from February 24, 1998 to August 16, 2005, the Defendant lent KRW 250 million to Nonparty 2 in total from May 29, 2015.

(3) Even according to the Defendant’s assertion, the Defendant lent a total of KRW 2.5 million to Nonparty 2 during a seven-year period from February 24, 1998 to August 16, 2005. Considering the interest on the money loaned from February 24, 1998, the principal and interest on the loan appears to be more than that on the contrary, setting the right to collateral security at a maximum amount of KRW 200,000,000, which is less than the leased principal on April 19, 2006, goes against the usual transaction concept.

(4) The Defendant alleged that Nonparty 2 lent money to Nonparty 2 in cash or check, with the exception of KRW 48 million confirmed the details of remittance. It is difficult to readily accept that the Defendant, who was living in Seoul, lent money to Nonparty 2, who was engaged in economic activities while living in Gwangju, in cash or check. Furthermore, in the case of Nonparty 2’s Nonghyup Bank (Account Number 1 omitted)’s check deposited on July 4, 2001, it is difficult to view that the Defendant applied the above check to Nonparty 2’s account on July 4, 2001 because the Defendant deposited KRW 60 million in the account of Nonparty 2’s Gwangju Bank (Account Number 2 omitted) with KRW 60 million from Nonparty 5’s account on July 4, 2001 and deposited the same amount on the same day.

(5) Furthermore, it is not possible to find out the details of interest accrued on the money that the Defendant asserted that he had lent to Nonparty 2. On April 10, 2006, the Maridong-gu, Gwangju District District Court ( Address 4 omitted) No. 453, the Defendant created the instant real estate and the instant real estate mortgage on the real estate owned by Nonparty 2, and made no effort to recover the claim against Nonparty 2 until that time.

(6) After completing the registration of ownership transfer of the instant real estate in the Defendant’s future, on January 30, 2013, the full amount of KRW 94 million loaned the instant real estate as security was remitted to Nonparty 2’s account, and Nonparty 2 used the money as repayment of its existing loan obligations.

(7) On June 25, 2015, the court rendered a judgment citing the Plaintiff’s claim on the ground that there was no secured debt against Nonparty 2 against the Defendant’s non-party 2 (Seoul District Court 2014Gahap63324) in the instant lawsuit of demurrer against distribution. The said judgment became final and conclusive on June 23, 2017 due to the Defendant’s failure to file an appeal via the appellate court (Seoul High Court 2015Na12771).

D. In light of these circumstances, the agreement between the defendant and the non-party 2, which caused the registration of transfer of ownership in this case, was made without the original obligation or with the false declaration of conspiracy. The lawsuit of demurrer against distribution in this case is premised on the same factual relations only with the lawsuit of this case seeking cancellation of transfer of ownership in this case based on the creditor’s subrogation right, but the judgment of the court below was rendered in the lawsuit of demurrer against distribution in this case, and the judgment became final and conclusive due to the defendant’s failure to file a final appeal. The court below needs to sufficiently examine whether it is reasonable to make a conclusion different from the lawsuit of demurrer against distribution in this case.

Nevertheless, the lower court rejected the Plaintiff’s claim on the ground that the evidence submitted by the Plaintiff did not reverse the presumption of registration. In so doing, the lower court erred by misapprehending the facts or misapprehending the legal doctrine on the reversal of the presumption of registration by exceeding the bounds of the principle of free evaluation of evidence inconsistent with logical and empirical rules without exhaust all necessary deliberations.

4. Conclusion

The defendant's appeal is with merit, and the judgment of the court below is reversed and the case is remanded to the court below for a new trial and determination. It is so decided as per Disposition by the assent of all participating Justices

Justices Kim Chang-suk (Presiding Justice)