[1] In a case where a lessor’s refusal notice of renewal under Article 10(4) of the former Commercial Building Lease Protection Act does not have any justifiable reason under Article 10(1)1 through 8, whether the previous lease is renewed by exercising the lessee’s right to request renewal of the contract, regardless of the prior notice of rejection by the lessor (affirmative)

[2] Whether a contract entered into by a lessee and a lessor with a new lease agreement after a lessee exercised the right to request renewal of the contract shall be deemed a re-contract for the previous lease (negative with qualification)

[3] Whether a lessee may seek a return of rent paid in excess of the rate of increase in rent under Article 11(1) of the former Commercial Building Lease Protection Act by unjust enrichment (affirmative)

[1] In full view of the language and structure of Article 10(1) through (3) of the former Commercial Building Lease Protection Act (amended by Act No. 9361 of Jan. 30, 2009; hereinafter “Act”) and Article 10(4) of the Act regarding the lessee’s right to request renewal of a lease agreement, the lessee’s right to request renewal of the lease agreement under Article 10(1) of the Act intends to achieve the lessee’s initiative. On the other hand, Article 10(4) of the Act requires the lessor’s active measures at the termination of the lease relationship due to the expiration of the term, and the renewal system under each of the two Acts differs from each other, the lessor’s right to request renewal under Article 10(1)1 through 8 of the Act can be exercised, regardless of the lessor’s refusal to renew the lease agreement, unless there is a justifiable reason to the lessor’s refusal to renew the lease agreement.

[2] Even if a lessee and a lessor take the form of a new lease contract after the lessee exercised the right to request renewal of the contract, it shall not be deemed as a renewal contract for the previous lease as long as it is evaluated to have the substance of renewal following the lessee’s exercise of the right to request renewal of the contract.

[3] In light of the legislative purpose of the former Commercial Building Lease Protection Act (amended by Act No. 9361 of Jan. 30, 2009; hereinafter “Act”), the structure and purport of the provision on the right to demand an increase or decrease in rent, etc., an agreement on rent that shall be paid in excess of the increase rate under Article 11(1) of the Act shall be null and void within the extent exceeding the increase rate, and the lessee may seek a return of the rent paid in excess as unjust enrichment.

[1] Article 10 of the former Commercial Building Lease Protection Act (amended by Act No. 9361 of Jan. 30, 2009) / [2] Article 10 of the former Commercial Building Lease Protection Act (amended by Act No. 9361 of Jan. 30, 2009) / [3] Articles 1, 11(1), and 15 of the former Commercial Building Lease Protection Act (amended by Act No. 9361 of Jan. 30, 2009); Article 741 of the Civil Act

[1] Supreme Court Decision 2009Da64307 decided Jun. 10, 2010 (Gong2010Ha, 1342)

Plaintiff (Law Firm Sharing, Attorneys Kim Sung-sung et al., Counsel for the plaintiff-appellant)

Defendant (Attorney Cho Jae-soo et al., Counsel for the defendant-appellant)

Seoul Central District Court Decision 2012Na48939 Decided April 12, 2013

The appeal is dismissed. The costs of appeal are assessed against the defendant.

The grounds of appeal are examined.

1. As to the grounds of appeal on the misapprehension of legal principles as to the scope of application of Articles 10(1) and 11 of the Commercial Building Lease Protection Act

Article 11(1) of the former Commercial Building Lease Protection Act (amended by Act No. 9361, Jan. 30, 2009; hereinafter “Act”) provides that “When rent or deposit is not reasonable due to any increase or decrease in taxes, public charges, and other burdens on the leased building, or any change in economic conditions, any party concerned may request an increase or decrease thereof in the future. However, in cases of an increase, it shall not exceed the rate set by Presidential Decree. A request for an increase in rent, etc. under paragraph (1) shall not exceed one year after the lease contract or agreed rent, etc. is made.” The foregoing provision applies only to cases where one party concerned requests an increase or decrease in rent, etc. agreed upon during the existence of the lease contract. This provision does not apply to cases where the lease contract is renewed after the termination of the lease contract, or where the rent, etc. is increased by agreement of the party concerned even before the termination of the lease contract (see Supreme Court Decision 2013Da80481, Feb. 13, 2014).

In addition, Article 10 (1) of the Act provides that a lessor shall not refuse a request for renewal of a contract between six months and one month before the expiration of the lease term without justifiable grounds as provided in subparagraphs 1 through 8. Paragraph (2) of the same Article provides that a lessee's right to request renewal of a contract under paragraph (1) of the same Article may be exercised only within the extent that the whole lease term including the initial lease term does not exceed five years. Paragraph (3) of the same Article provides that the lease renewed under paragraph (3) of the same Article shall be deemed to have been renewed under the same conditions as the former lease, and the rent and deposit may be increased or decreased within the extent of Article 11. Paragraph (4) of the same Article provides that if the lessor fails to notify the lessee of the refusal of renewal or to notify the lessee of the change of the conditions within the period as provided in Article 10 (1), the lease shall be deemed to have been renewed under the same conditions as the former lease at the expiration of the lease term.

In full view of the language and structure of Article 10(1) through (3) of the Act regarding the lessee’s right to request renewal of a lease and the structure of Article 10(4) of the Act regarding the lessee’s right to request renewal of a lease, as well as the lessee’s right to request renewal of a lease under Article 10(1) of the Act, the lessee’s right to request renewal of the lease is to achieve the lessee’s initiative. On the other hand, Article 10(4) of the Act requires the lessor’s active measures at the expiration of the lease relationship due to the expiration of the term. The renewal system under these two legal provisions differs from each other (see Supreme Court Decision 2009Da64307, Jun. 10, 201). The lessee’s right to request renewal of the lease is not a prior lessee’s right to request renewal of the lease under Article 10(1)1 through 8 of the Act, regardless of the lessor’s refusal to renew the lease.

According to the reasoning of the judgment of the court below and the judgment of the court of first instance cited by the court below, as to the lease of this case's store, which is a commercial building, on January 15, 2005, under which the plaintiff and the defendant had the expiration date of the lease term on January 15, 2006, even if the defendant's notice of refusal under Article 10 (4) of the Act was earlier than the plaintiff's exercise of the right to request renewal of the contract under Article 10 (1) of the Act, the plaintiff's exercise of the right to request renewal of the contract is valid on the premise that the defendant's refusal notice of renewal did not have any justifiable reasons under Article 10 (1) 1 through 8 of the Act. The court below rejected the plaintiff and the defendant's new lease contract concluded on January 16, 206, based on its conclusion and content, it is reasonable to deem that the former lease was renewed according to the plaintiff's right to request renewal of contract.

In light of the aforementioned legal principles and records, the above judgment of the court below is just and acceptable, and contrary to the allegations in the grounds of appeal, there are no errors in the misapprehension of legal principles as to the scope of application of Articles 10(1) and 11 of the Act. Supreme Court Decision 2002Da23482 Decided June 28, 2002, which is contrary to the grounds of appeal, is related to the Housing Lease Protection Act of which the lessee does not have any provision on the lessee's right to request renewal of the contract, and it is not appropriate to invoke the

2. As to the ground of appeal on misapprehension of legal principles as to illegal consideration

The purpose of the Act is to ensure the stability of the economic life of citizens by providing for special cases concerning the lease of commercial buildings (Article 1), and in cases where the rent of the rent is unreasonable due to taxes, public charges, and other burdens on the leased building, or changes in the economic situation, the parties concerned may request an increase or decrease in the rent in the future, but in cases of an increase, it shall not exceed the rate set according to the standards prescribed by Presidential Decree (Article 11(1)), and it shall be restricted that in cases of an increase, it shall not exceed the rate set by Presidential Decree (Article 11(1). An agreement contrary to the provisions of the Act, which is contrary

In light of the legislative purpose of this Act, the structure and purport of the provision on the right to demand an increase or decrease in the rent, the agreement on the rent that shall be paid in excess of the increase ratio pursuant to Article 11(1) of the Act shall be null and void to the extent exceeding the increase ratio, and the lessee may seek a return of the rent paid in excess of the excessive increase ratio.

In the same purport, the lower court is justifiable to have rejected the Defendant’s assertion that the renewed rental agreement on illegal consideration is null and void within the scope exceeding the rate of increase under Article 11(1) of the Act, and thus, the Defendant’s return of unjust enrichment corresponding to the excessive portion is ordered, and that the payment of rent exceeding the said rate constitutes illegal consideration. In so doing, contrary to what is alleged in the grounds of appeal, there is no

3. Conclusion

Therefore, the appeal is dismissed, and the costs of appeal are assessed against the losing party. It is so decided as per Disposition by the assent of all participating Justices.

Justices Yang Chang-soo (Presiding Justice)