2018Da25946 All proceeds

Plaintiff

Defendant

Suwon District Court Decision 2017Na5830 Decided March 29, 2018

may 7, 2021

The judgment of the court below is reversed, and the case is remanded to the Gu Government District Court.

The grounds of appeal are examined.

1. Factual basis

According to the reasoning of the lower judgment, the following facts are revealed.

A. On June 9, 2001, the Defendant purchased the instant land from the Korea Agricultural and Rural Infrastructure Corporation (hereinafter “Korea Rural Community Corporation”) in KRW 140,000,000, in total, and paid the amount calculated by adding interest of 4.5% per annum to the sales price from January 2002 to January 2021 each year.

On July 6, 2001, the Defendant registered the transfer of ownership with respect to the instant land, and registered the establishment of a neighboring mortgage, which amounts to 176,400,000 of the maximum debt amount, in order to secure the obligation to pay the purchase-price.

B. On April 16, 2002, the Nonparty concluded the instant sales contract with the Defendant to purchase the instant land in KRW 146,000,000. The Nonparty paid the Defendant the sum of the down payment and the intermediate payment to the Defendant on the date of the contract, and received the instant land, instead of paying the remainder of KRW 120,000,000 on an annual installment payment to the Korea Rural Community Corporation, and decided to register the ownership after July 9, 2008.

On June 22, 2005, the Nonparty filed a provisional registration of the right to claim the transfer of ownership on the instant land due to the pre-sale agreement.

C. The Nonparty paid the installment from 2003 to 2008, and the Korea Rural Community Corporation applied for an auction for the enforcement of the right to collateral security on the instant land around September 2009. On December 21, 2009, the Defendant repaid to the Korea Rural Community Corporation KRW 91,810,060, the total amount of the installment remaining after adding the principal, interest and overdue interest to the principal, interest and overdue interest. The Korea Rural Community Corporation withdrawn the application for auction.

D. The Nonparty filed a lawsuit against the Defendant seeking the implementation of the procedure for ownership transfer registration based on the above provisional registration. On January 21, 2011, the appellate court rendered a judgment dismissing the Nonparty’s claim on the grounds that the instant sales contract was rescinded around June 9, 2009 due to the Nonparty’s delinquency in payment of the installment (or the District Court Decision 2009Na14143), and the said judgment was dismissed and finalized on May 13, 201 (Supreme Court Decision 201Da18895).

E. On the basis of the authentic deed of a monetary loan agreement, the Plaintiff was issued an order for seizure and assignment of claims two times as follows. ① On August 23, 2013, the Plaintiff received an order for seizure and assignment of claims against the Nonparty’s Defendant regarding KRW 50,023,140 among the claims for refund of the purchase price, and the said order was served on the Defendant on August 27, 2013, and became final and conclusive on September 17, 2013. ② On November 11, 2013, the Plaintiff received an order for seizure and assignment of claims against KRW 68,308,431 among the claims for return of the purchase price, and the said order was served on the Defendant on November 13, 2013, and became final and conclusive on November 26, 2013.

F. The Nonparty primarily filed a lawsuit against the Defendant seeking payment of KRW 216,693,360 as a result of the implementation of the procedure for the registration of ownership transfer based on the instant sales contract and the restitution to the original state following the cancellation of the instant sales contract. On January 28, 2015, the first instance court dismissed all Nonparty’s claims. ① The instant sales contract was rescinded around June 9, 2009; ② the Nonparty had a claim for refund of KRW 80,620,000 for the purchase price already paid by the Nonparty to the Defendant; ② the Nonparty had a claim for reimbursement of KRW 80,620,000 for the ancillary claim, but the said claim was entirely entirely paid to the Plaintiff (or Jina District Court Decision 2013Ga5289). The said judgment was dismissed (Seoul High Court Decision 2015Na7987). The final appeal was dismissed and finalized (Supreme Court Decision 2016Da63477).

2. Whether there is a misapprehension of legal principles as to the retroactive effect of offset (ground of appeal No. 1)

(a) Where both parties assume an obligation with the same kind of obligation, if both parties become due, each obligor may offset against an equal amount (Article 492(1) of the Civil Act);

"When the obligation becomes due" under Article 492(1) of the Civil Act refers to the time when the obligee is entitled to a claim for performance to the obligor, and it does not refer to the time when the obligor is found to have delayed performance (see Supreme Court Decision 81Meu10, Dec. 22, 1981).

A declaration of intent of set-off is deemed to have expired with respect to an equal amount when each obligation can be set off (Article 493(2) of the Civil Act). In a case where a declaration of intent of set-off is made, the obligation becomes extinct with respect to an equal amount retroactively from the time of set-off. As such, the calculation of the difference in both claims arising from set-off or appropriation of set-off is based on the point of time of set-off. Therefore, in a case where interest or delay damages have occurred on the passive obligation prior to that time, the calculation of the difference in both claims or appropriation of set-off shall be based on the point of time of set-off. Therefore, in a case where interest or delay damages have occurred on the passive obligation prior to that time, after calculating the interest or delay damages on the passive obligation as of

B. The lower court determined as follows.

Since the sales contract of this case was cancelled due to the non-party's default, the non-party is entitled to receive the total amount of KRW 80,620,000 from the defendant for restitution and interest calculated at the rate of 5% per annum from the date of payment pursuant to Article 548 (2) of the Civil Act.

Therefore, barring any special circumstance, the Defendant is obligated to pay damages for delay from May 1, 2015 to the Plaintiff, a total of KRW 123,571,224 out of the total amount of principal and interest of the claim for refund of the purchase price incurred until April 30, 2015, and KRW 118,331,571 of the total amount of principal and interest of the claim for refund of the purchase price incurred until April 30, 2015.

The Defendant expressed his intent to offset against the amount equal to that of the claim for refund of the purchase price by using multiple claims against the Nonparty or the Plaintiff as the automatic claim. The Defendant may set off part of the claim, namely, the claim for return of profits from use, the claim for damages incurred by the Defendant in order to withdraw auction as requested by the Korea Rural Community Corporation, the claim for damages arising from the Defendant’s temporary payment of the purchase price due to the Nonparty’s nonperformance of obligation, the claim for litigation costs against the Nonparty, the amount of litigation costs against the Plaintiff, and the amount

As of April 30, 2015, when the duplicate of the application for the instant payment order was served on the Defendant, KRW 118,331,571 of the Plaintiff’s entire claim and the total amount of the Defendant’s automatic claim set-off in the order of principal and interest, the Plaintiff’s entire claim remains KRW 43,541,656 of the principal.

C. However, the lower judgment is difficult to accept for the following reasons.

The Plaintiff’s claim for the refund of the purchase price, which is a passive claim, accrued on June 9, 2009, when the instant sales contract was rescinded, and the Defendant’s automatic claim occurred in sequence from the time when the sales contract was rescinded. Since both claims are set-off when both claims occur, the interest or delay damages incurred as of the set-off date shall be extinguished with the automatic claim, and the balance shall be extinguished if any. If the principal of the passive claim is partially extinguished, there is no interest as prescribed by Article 548(2) of the Civil Act, and only the remainder of the principal shall be raised.

The court below shall examine the fulfillment period of each automatic claim and calculate the principal, interest, or delay damages of the passive claim as of the set-off date, and terminate it in the order of the interest, delay damages, and principal of the passive claim as the automatic claim.

Nevertheless, the lower court, without examining whether the principal of the claim for refund of the purchase price, which is a set-off date, ceases to exist, and set off the total amount of the automatic claim from the principal of the claim for refund of the purchase price, on the premise that the interest calculated at the rate of 5% per annum from the date of payment pursuant to Article 548(2) of the Civil Act to April 30, 2015, which was served on the Defendant, shall continue to take place from the date of payment to April

The judgment of the court below is erroneous in the misapprehension of legal principles as to the retroactive effect of a set-off and failing to exhaust all necessary deliberations, which affected the conclusion of the judgment.

3. Conclusion

The judgment of the court below is reversed without examining the remaining grounds of appeal, 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 on the bench.

Justices Lee Dong-won

Justices Kim Jae-hyung

Justices Min You-sook

Justices Noh Tae-ok