[1] The point of termination of imposition of development charges for development projects which develop land only

[2] Where a housing site creation project is conducted by a joint development method, whether it can be deemed that the housing site has been actually developed on the date of payment of the remaining sale price or the date of report of commencement of construction (negative)

[3] Requirements for construction costs to constitute net construction costs among the development costs subject to deduction when calculating development gains

[4] The case holding that in case where a development project operator moved waste to a different place from the land subject to the project but later takes it back to a legitimate garbage reclamation site outside the land subject to the project, the construction cost should be included in the development cost as net construction cost as much as the expenses incurred in the removal from the original land subject to the project and the legitimate garbage reclamation site outside the project

[1] For the purpose of deeming the time prior to the date of obtaining authorization for completion of development projects which develop land only as the time of completion of development charges, Article 9(3)2 of the Restitution of Development Gains Act (amended by Act No. 4563 of Jun. 11, 1993) and Article 8(1)1, 8(2)1 and 2 of the former Enforcement Decree of the Restitution of Development Gains Act (amended by Presidential Decree No. 15398 of Jun. 25, 1997), the date falling under Article 53 of the former Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 1467 of Dec. 31, 1994), or the date of completion of development after the date of report for completion of development under Article 16 of the Building Act shall be the time of completion of development. This interpretation shall also apply to the interpretation of Article 16(3)2 of the former Enforcement Decree of the Restitution of Development Gains Act prior to the date of completion of development charges.

[2] In a housing site creation project under a joint development method, unlike the method of selling in lots to others after the completion of the housing site creation, the housing site development project shall be first supplied to the housing developer, etc. before the completion of the housing site preparation period in order to prevent the duplication of construction and to reduce the housing construction period, and then the housing site development project developer, etc. shall perform the remainder of the housing site construction project together with the housing developer, etc. In a case where a housing site creation project is conducted in accordance with a joint development method, the housing site developer, etc. shall first supply the housing site to the housing developer, etc., and shall be paid the remainder of the housing site to the housing developer, etc., and even if the housing site developer, etc. commenced a construction project, it shall not be deemed

[3] According to Article 11(1)1 of the Restitution of Development Gains Act (amended by Act No. 4563, Jun. 11, 1993); Article 10(1)1 of the former Enforcement Decree of the Restitution of Development Gains Act (amended by Presidential Decree No. 15398, Jun. 25, 1997); Article 78 of the former Enforcement Decree of the Budget and Accounts Act (amended by Presidential Decree No. 14710, Jul. 6, 1995); Articles 6 and 8 of the former Rules on Contract Affairs (amended by Ordinance of the Prime Minister No. 511, Jul. 6, 1995); Articles 13, 15 through 18 of the Rules on Cost Accounting; Article 15 of the Enforcement Decree of the Restitution of Development Gains Act (amended by Act No. 4563, Jun. 11, 1993); Article 10(1)1 of the former Enforcement Decree of the Restitution of Development Gains Act (amended by Presidential Decree No. 15398, etc.).

[4] The case holding that when a development project operator moved garbage to another place in the land where the project was performed, but the illegality was pointed out, it should be included in the development cost as net construction cost to the extent that it would have been incurred in the removal of garbage reclaiming outside the land where the project was performed after that removal from the land where the project was performed and the removal of garbage reclaiming outside the land where the project was performed

[1] Article 9 (3) 2 of the former Restitution of Development Gains Act (amended by Act No. 4563 of Jun. 11, 1993), Article 9 (3) 2 of the Restitution of Development Gains Act (amended by Act No. 4563 of Jun. 11, 1993), Article 8 (1) 1 of the former Enforcement Decree of the Restitution of Development Gains Act (amended by Presidential Decree No. 13956 of Aug. 12, 1993), Article 8 (1) 1 and 2 of the former Enforcement Decree of the Restitution of Development Gains Act (amended by Presidential Decree No. 15398 of Jun. 25, 1997), Article 19 of the former Enforcement Decree of the Restitution of Development Gains Act (amended by Presidential Decree No. 15563 of Dec. 16, 194), Article 196 of the former Enforcement Decree of the Restitution of Development Gains Act (amended by Presidential Decree No. 19635 of the Building Act)

[1] Supreme Court Decision 97Nu19328 delivered on June 23, 200 (Gong2000Ha, 1761) / [3] Supreme Court Decision 98Du15566 delivered on June 9, 200 (Gong2000Ha, 1663 delivered on November 27, 2001) Supreme Court Decision 2001Du2362 delivered on November 27, 2001

Korea Land Corporation (Law Firm Sejong, Attorneys Yellow-sik et al., Counsel for the plaintiff-appellant)

Ansan Market (Attorney Jyang-hun et al., Counsel for the plaintiff-appellant)

Seoul High Court Decision 96Gu4888 delivered on July 21, 1999

The judgment below is reversed and the case is remanded to Seoul High Court.

The grounds of appeal are examined (to the extent of supplement in case of supplemental grounds submitted after the lapse of the period).

1. As to the point of termination of imposition

The court below rejected the plaintiff's assertion that the price increase at the time of imposition is not attributable to the plaintiff, since it is reasonable to deem that the plaintiff, a project developer, who developed only land, sold part of the land subject to the imposition of this case to the end of the construction before the approval date of the completion of the whole project, and the basic construction was completed at the time when the sale price was settled after the commencement of construction or after the completion of construction work is possible. Thus, the court below rejected the plaintiff's assertion that the price increase at the time of imposition of this case is not attributable to the plaintiff due to the increase in the sale price after the increase in the price of this case by the payment obligor at that time.

However, for the purpose of seeing the point before the date of imposition completion of development projects which develop land only as the point of time of imposition completion, Article 9 (3) 2 of the Act, Article 8 (1) 1, (2) 1 and 2 of the Enforcement Decree of the Act, Article 53 of the former Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 14467 of Dec. 31, 1994), or Article 16 of the Building Act must be completed as of the date of report of commencement of construction under Article 16 of the Act. If the actual development is not completed by the time, the date of completion of the development after the date of its imposition shall be the date of its imposition (see Supreme Court Decision 97Nu19328, Jun. 23, 200); such interpretation shall also apply to the interpretation of Article 9 (3) 2 and Article 19 (1) 1 of the former Enforcement Decree of the Income Tax Act prior to the amendment by Presidential Decree No. 45638, Jun. 1111, 19, 1993>

Meanwhile, unlike the way of selling a housing site in this case after the completion of the construction of the housing site in this case, the housing site creation project under the joint development method such as the method of selling the housing site to the other is pre-supplyed to the housing developer, etc. before the completion of the construction site preparation period in order to prevent the duplication of construction and to reduce the housing construction period. Since the housing site creation project is carried out in accordance with the joint development method as well as the remaining part of the housing site preparation project with the housing developer, in case where the housing site creation project is carried out under the joint development method, the housing site developer pre-supplys the housing site to be developed to the housing constructor, etc., and is paid the outstanding sale price, or the housing site developer, etc. starts the construction project, it cannot be deemed that the actual

Nevertheless, in the case of a housing site creation project under a joint development method, the court below did not further examine whether the development was completed at any time prior to the approval date of completion of the development project of this case without further examining whether the development was completed at any time before the approval date of completion of the development project of this case. Thus, the court below failed to conduct a deliberation or erred in the misapprehension of legal principles as to the point of termination of the imposition of the development charges, which affected the conclusion of the judgment. The grounds of appeal assigning this error are with merit.

2. As to development costs:

A. According to Article 11(1)1 of the Act, Article 10(1)1 of the Enforcement Decree of the former Budget and Accounts Act, Article 78 of the former Enforcement Decree of the Budget and Accounts Act (amended by Presidential Decree No. 14710 of July 6, 1995), Articles 6 and 8 of the former Rules on the Settlement of Contracts (amended by Ordinance of the Prime Minister No. 511 of July 6, 1995), Articles 13 and 15 through 18 of the Budget Standard (hereinafter “Budget Standard Rule”) of the former Rules on Cost Accounting, the net construction cost out of the development cost subject to deduction, in calculating development gains, refers to the cost of materials (direct and indirect labor cost), labor cost (direct and indirect labor cost), and cost of construction cost, which are the elements of the project. However, the development gains themselves refer to the profit derived from the promotion of the value of the land that is derived from the development project, and even if the development cost in question increases to the pertinent land, it can bring about the increase of construction cost.

In light of such legal principles and records, the judgment of the court below is just to the effect that the land unit cost of this case is merely an incidental cost related to the acquisition of the land subject to the project, but does not constitute development costs which bring about the increase of benefits or values, and that the indirect cost not accepted by the court below is not a net construction cost, because the land unit cost of this case is merely an incidental cost related to the acquisition of the land subject to the project, and is not an employee of the relevant department working in the principal and branch office of the plaintiff, and that the indirect labor cost of the project site is different from the indirect labor cost of the project site to be paid by the worker, employee, and on-site supervisor, etc., and such indirect cost cannot be deemed to be a labor cost

B. Next, according to the health cost as to the cost of garbage treatment claimed by the plaintiff, according to the facts duly admitted by the court below, the plaintiff moved the waste within the original land subject to the project to another place within the land subject to the project (the first disposal), but the illegality was pointed out, and then the disposition of this case was lawful, which included only the first disposal cost in the soil construction cost as the development cost for the soil construction cost. The court below determined that the first disposal cost was legitimate. The amount of the first disposal cost incurred by the plaintiff should be included in the development cost as the net construction cost, which included only the first disposal cost in the development cost for the land subject to the project as the cost of the first and the second disposal cost as the cost of the first disposal cost to the land subject to the project and the legitimate disposition of this case, which included only the first disposal cost in the development cost without examining the cost, and thus, it is erroneous in the misapprehension of full deliberation. The ground of appeal pointing this out is justified.

3. Conclusion

Therefore, 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 on the bench.

Justices Park Jae- Jae (Presiding Justice)