Plaintiff (Attorney Kim Dong-gu, Counsel for the plaintiff-appellant)

Korea Housing Guarantee Co., Ltd. (Attorney Kim Young-chul, Counsel for the plaintiff-appellant)

October 10, 2007

Seoul Central District Court Decision 2005Kahap102671 Decided September 29, 2006

1. The plaintiff's appeal and the changed plaintiff's claim that are exchanged in the court room are all dismissed.

2. Of the judgment of the first instance court, the defendant "Korea Housing Guarantee Co., Ltd." shall be corrected to "Korea Housing Guarantee Co., Ltd."

3. The costs of appeal and the costs of the trial arising from the changed claim for exchange shall be borne by the plaintiff.

The part of the judgment of the court of first instance against the plaintiff is revoked, and the trust contract concluded on November 3, 2004 between the defendant and the co-defendant (mutually omitted 2 omitted) Co-Defendant Co-Defendant Co-Defendant Co-Defendant Co-Defendant Co. (mutually omitted hereinafter referred to as the "Co-Defendant Co-Defendant Co-Defendant Co-Defendant Co. (mutually omitted 2) on November 3, 2004 with respect to the size of 462-64 m2,674 m2, Nam-gu, Namyang-si, Nam-si, Namyang-si, Seoul, shall be revoked. The defendant shall pay to the plaintiff the amount of 60 million won per annum and the amount of 20% per annum from July 13, 2004 to January 2, 2006, the amount of 60 billion won per annum and the amount of 20% per annum from the next day until he fully paid the above land (the plaintiff shall have cancelled the ownership transfer registration of the above land on November 3, 95185).

1. Basic facts

A. On April 2, 2003, Nonparty 1 entered into a contract with Nonparty 2 and 3 to purchase a total of KRW 4.4 billion per 5.9 billion per 1.5 billion per annum prior to the merger owned by Nonparty 4,462-31 and KRW 820,00 per 1.5 billion per 5.9 billion per 1.5 billion per 25 April 25, 2003, for the purpose of constructing a main complex building (hereinafter “company 1 omitted”) where Nonparty 1 is the representative director, and the said sales contract was cancelled under mutual agreement with Nonparty 2 and 3 on April 25, 2003, for the purpose of constructing a main complex building.

B. (Mutual 1 omitted) The Company: (a) borrowed money of KRW 1 billion from the Plaintiff to use for part payments for the sale and purchase of the said land in order to implement a new construction project for the main complex building; (b) concluded a sales contract with the Plaintiff on May 26, 2003, stipulating that the principal amount of KRW 1 billion shall be paid within three months after the payment of part payments; and (c) the return on investment shall be paid within six months; and (d) on May 26, 2003, the Plaintiff and the Plaintiff jointly with the Plaintiff to purchase the said land amount of KRW 4.5 billion, KRW 462-31, and KRW 1.6 billion with the said land amount of KRW 6.1 billion with the said amount of KRW 6.1 billion; and (e) concluded a sales contract to pay the remainder by May 28, 2003, and the remainder by July 30, 2003.

C. (Trade Name 1 omitted) On May 28, 2003, the Company borrowed the above amount of KRW 1 billion from the Plaintiff and pays the above intermediate payment. On the other hand, as the above agreement, the Plaintiff, as the above, issued a “statement of payment of the rent amounting to KRW 1 billion until August 28, 2003,” with the purport that the remaining amount of KRW 1 billion shall be paid until November 8, 2003, and issued a promissory note with face value of KRW 1 billion at face value as a security, and had it notarized. However, without paying any balance of the above purchase price, the Company rescinded the above sales contract again with the land owner.

D. After that, as the above non-party 1 was selected and appointed as the representative director of the company (mutual name 2 omitted), the company (mutual name 2 omitted) acquired the construction project of the above main complex building from the company (mutual name 1 omitted) and agreed on June 18, 2003 to purchase the land of this case and the land of this case 462-31 under the name of the plaintiff and joint owner of the above land in gold 6 billion won (the land of this case 4.5 billion won, 462-31 billion won, and 1.5 billion won) again from the owner of the above land, and the previous contract payment and intermediate payment paid by the company (mutual name 1 omitted) shall be deemed to have been paid the down payment and intermediate payment of 4.1 billion won, and the balance 4.1 billion won shall be paid by July 30, 2003.

E. On June 30, 200, before the remainder payment date, Nonparty 3 and 2 completed the registration of transfer of ownership on the instant land in the name of the company (mutually omitted 2 omitted), but it was not paid any balance after July 30, 2003, which was the remainder payment date. Accordingly, the above sales contract was rescinded on August 19, 2003, and the registration of transfer of ownership was cancelled under the name of the company (mutually omitted 2 omitted).

F. After that, the company (mutual 2 omitted) purchased the land of this case in KRW 4.5 billion on April 27, 2004 and the non-party 3 and 2, and the land of this case in KRW 4.5 billion, but completed the registration of ownership transfer on the land of this case in its own name, on the ground that the contract deposit and intermediate payment for the land of this case are deemed to have been paid in KRW 1.5 billion (=1.4 billion x 4.5 billion / 6 billion) among the total sum of KRW 1.4 billion paid down payment and intermediate payment in KRW 1.4 billion (i.e., KRW 1., KRW 1.4 billion).

G. (Trade Name 2 omitted) On July 12, 2004, the Company concluded a contract to pay in kind the amount of KRW 400 million out of KRW 1 billion to the Plaintiff and the above borrowed principal at the time of the success of project financing, and to pay in kind the remainder of KRW 600 million at KRW 105,000,000 to the right side of the main entrance and exit of the above Jeju Complex.

H. In relation to the construction project of the above main complex building, the Defendant made a project implementer to become a company (trade name 2 omitted) and provided a house sales guarantee to the buyers of the above main complex building, and thereafter, the company (trade name 2 omitted) obtained a building permit from the Namyang market on October 19, 2004.

I. (Trade Name 2 omitted) On November 3, 2004, the company entered into a trust agreement with the Defendant on the site of the above main complex building, including the land in this case, and the building constructed on the ground thereof, to allow the Defendant to sell in lots or dispose of the above trusted real estate (hereinafter “instant trust agreement”), and on the same day, the company entered into the ownership transfer registration based on the instant trust agreement (hereinafter “instant trust registration”) with respect to the land in this case in the future of the Defendant.

(j) At the time of the instant trust contract, the company (mutual 2 omitted) as active property, did not have any property other than the site for the instant main complex building in the amount of KRW 6 billion and the building under construction on the ground, while the company was in excess of its liability due to its passive property, as it bears the loan liability amounting to KRW 8 billion and the obligation for the construction cost.

C. (Trade Name 2 omitted) On November 6, 2004, the company began to sell the land in lots after obtaining approval for the announcement of invitation of residents from the Namyang market. On the other hand, on October 19, 2005, the plaintiff filed the lawsuit in this case after receiving the decision for provisional disposition prohibiting the disposal of the land in this case from the Seoul Southern District Court. However, on April 27, 2006, the defendant deposited the amount of KRW 400 million and received the decision for revocation of provisional disposition under Article 307 of the Civil Execution Act, the above provisional disposition registration was cancelled on May 10, 2006.

[Ground for Recognition: Facts without dispute, Gap evidence 1 through 10, Gap evidence 13, Eul evidence 1 through 4, and Eul evidence 6 through 11 (including provisional number), the purport of whole pleadings]

2. The plaintiff's assertion and judgment

A. Determination on this safety defense

The defendant filed the lawsuit of this case on November 11, 2005, even though the plaintiff knew before November 11, 2004 that the trust contract of this case constituted a fraudulent trust, etc., which must be filed on November 11, 2005 after the lapse of one year from the plaintiff. Thus, the lawsuit of this case is an unlawful lawsuit brought against the exclusion period. However, (mutual 2 omitted) since there is no evidence to acknowledge that the plaintiff had known that the company entered into the trust contract of this case as a private will before November 11, 2004, the defendant's assertion is without merit.

B. Judgment on the merits

(1) The plaintiff's assertion

As the cause of the claim of this case, where the debtor concludes a trust agreement with a third party with respect to real estate which is the only property without discharging his obligation, and completes the registration of ownership transfer under his name, the trust agreement shall be deemed to be a fraudulent act with the knowledge that it would prejudice the creditor. Meanwhile, Article 8(1) of the Trust Act provides that "if the debtor establishes a trust with the knowledge that it would prejudice the creditor, the creditor may claim cancellation and restitution of Article 406(1) of the Civil Act even if he acted in good faith." (mutual name 2 omitted) The trust agreement of this case where the company pays only 40 million won out of the above loan obligation against the plaintiff, and entrusts the defendant with the land of this case which is the only property to the defendant without paying the remaining amount of 60 million won, constitutes a fraudulent trust, and thus it is impossible or difficult for the company to cancel the trust registration of this case against the defendant, but (mutual name 2.5 billion won omitted) the company should compensate for the ownership transfer registration of this case in its name after completing the trust registration of this case to the third party 2500.

(2) Determination:

In full view of the overall purport of the pleadings, the company (mutual 2 omitted) completed the registration of ownership transfer on the land of this case from the defendant on September 29, 2006 due to the attribution of trust property, and completed the registration of ownership transfer on the ground of payment in kind to the Sejong Construction Industry Co., Ltd. which is the contractor of the construction project of this case on the same day, and the Sejong Construction Industry Co., Ltd. again completed the registration of ownership transfer on the ground of trust contract to the defendant on the same day. On December 20, 2006, the company completed the registration of ownership transfer on the ground of the trust contract to the defendant on the same day. The 8m2-90 of the land of this case was divided on December 20, 206 into 462-90, 16m2, 16m2, 16m2, and 462-91, 467m27, and 467m27, and 567m27.

The plaintiff's assertion seeking compensation for value on the ground that the cancellation of the trust contract of this case, the cancellation of the trust contract of this case, and the cancellation of the trust registration of this case, which is the method of restitution, has become impossible or considerably difficult, is premised on the existence of the trust contract of this case and the trust registration of this case. As such, the plaintiff's above assertion cannot achieve the purpose of filing the lawsuit of this case, which is the restoration of responsible property, due to the cancellation of the trust registration of this case and the cancellation of the trust registration of this case, as long as the company and the defendant terminated the trust contract of this case on May 15, 2006, which is before the closure of the first instance court proceedings, and the subject of cancellation and restoration becomes no longer available by the cancellation of the trust registration of this case.

3. Conclusion

Therefore, the plaintiff's claim for cancellation of the trust contract of this case is dismissed as it is without merit. The judgment of the court of first instance with the same conclusion is just, and the plaintiff's appeal is dismissed as well. The plaintiff's claim for compensation for value change in exchange in the court of first instance is also without merit, and the defendant of the judgment of the court of first instance "Korea Housing Guarantee Co., Ltd." is clearly erroneous in the "Korea Housing Guarantee Co., Ltd

Judges Sung-tae(Presiding Judge)