Whether a special contract on the use, profit-making and management of the jointly owned property that infringes on the essential part of the co-ownership right is naturally succeeded to a specific successor of the co-owner (negative in principle

Matters concerning the management of co-owned property shall be determined by a majority of co-owners' shares, and the special agreement on the use, profit-making and management of co-owners' co-owned property shall be naturally succeeded to the specific successor of the co-owner. However, if the special agreement on co-owned property can be deemed to infringe on the essential part of co-owned property due to the de facto waiver of the right to use and profit-making as the right of share holder, barring any special circumstance, such as the specific successor acquired the right of share

Articles 263 and 265 of the Civil Act

Supreme Court Decision 2005Da1827 Decided May 12, 2005 (Gong2005Sang, 929) Supreme Court Decision 2007Da64167 Decided November 29, 2007

Plaintiff (Seoul General Law Firm, Attorneys Jeong Tae-soo et al., Counsel for the plaintiff-appellant)

Defendant 1 and one other

Suwon District Court Decision 2008Na27506 Decided June 24, 2009

The judgment of the court below is reversed, and the case is remanded to Suwon District Court Panel Division.

The grounds of appeal are examined.

According to the reasoning of the judgment below, while Defendant 1, Defendant 2, Nonparty 1, Nonparty 2, and Nonparty 3 (hereinafter collectively referred to as “previous co-owners”) share each of the instant land from around 1976 to KRW 1/9,2/9, 3/9, 1/9, 2/9, and 9, the court below determined that the Plaintiff acquired shares of Nonparty 1/9 (hereinafter referred to as “instant shares”) out of the instant land during the voluntary auction procedure on March 16, 2006, since around 1987, Defendant 1 and 53/57 shares in the instant building and owned the instant land including the site of the building, the former co-owners, who were co-owners of the instant land, were entitled to occupy and use the instant land without compensation for possession and use under the special agreement between the Defendants (hereinafter referred to as “the former co-owners”), and thus, the former co-owners, who were co-owners of the instant land, can not be deemed as co-owners’ share under the special agreement among the Defendants.

However, matters concerning the management of the jointly owned property shall be determined by a majority of co-owners' share, and the special agreement on the use, profit-making, and management of the jointly owned property among co-owners shall be naturally succeeded to the specific successor of the co-owners (see Supreme Court Decisions 2005Da1827, May 12, 2005; 2007Da64167, Nov. 29, 2007). However, if special agreement on the jointly owned property can be deemed to infringe on the essential part of co-ownership by practically abandoning the right to use and benefit as a right holder of the jointly owned property, barring any special circumstance such as where the specific successor acquired the right to share with the knowledge of such fact, it cannot be deemed that the specific successor naturally succeeds to the co-ownership,

Therefore, as acknowledged by the court below, the defendants occupy the whole land of this case (the records of this case, the defendants stated in the court of first instance that they occupy the whole land of this case including the garden in addition to the part of the site of this case, but the court below held that they possess only the part of the site of this case, and there is an agreement to allow them to use and profit from the above garden free of charge, and as to the above garden, the non-party 5 claims that the above garden is occupied and used by the non-party 2 and the non-party 3 by leasing the above garden from the non-party 2 and the non-party 3, and it seems to have cancelled the above confession. However, if the previous co-owners including the defendants agreed to allow them to use the whole land of this case without fixing the period, it is difficult to view that the non-party 2 and the other co-owners including the non-party 3 have actually renounced the right to use and profit from the land of this case as a matter of course, so long as the plaintiff can not be seen to acquire the shares of this case.

Nevertheless, the court below erred by misapprehending the legal principles as to the succession of special agreement between co-owners, thereby failing to exhaust all necessary deliberations as to the requirements of succession of special agreement, which affected the conclusion of the judgment.

Therefore, the lower judgment is reversed, and the case is remanded to the lower court for further proceedings consistent with this Opinion. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Park Si-hwan (Presiding Justice)