Whether Article 368(1) of the Civil Act applies to a case where the proceeds of auction of the real estate owned by a debtor and the real estate owned by a person who has pledged his/her property to secure another's property are distributed at the same time (negative), and whether the same applies to a case where a person who has pledged his/her property to secure another'

Where part of several real estate on which the joint mortgage is established is owned by the debtor, and part of the real estate is owned by the debtor and is distributed at the same time, Article 368(1) of the Civil Act shall not apply to the auction proceeds of the real estate owned by the debtor, and the joint mortgagee shall preferentially distribute the proceeds of the auction proceeds of the real estate owned by the debtor to the joint mortgagee, and shall additionally distribute the proceeds of the auction proceeds of the real estate owned by the person who has pledged the property to secure the property, only if there is

Articles 368(1) and 428(1) of the Civil Act

Supreme Court Decision 2008Da41475 Decided April 15, 2010 (Gong2010Sang, 874)

Plaintiff (Attorney Park Jong-soo et al., Counsel for the plaintiff-appellant)

Seoul High Court Decision 200Na14484 delivered on May 1, 200

Suwon District Court Decision 2014Na9202 decided October 31, 2014

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

The grounds of appeal are examined (to the extent of supplement in case of supplemental appellate briefs not timely filed).

1. Regarding ground of appeal No. 1

The allegation in this part of the grounds of appeal is ultimately an error in the lower court’s fact-finding regarding the establishment of the secured claim against Nonparty 1. The fact-finding and the preparation and evaluation of evidence, which form the basis of the fact-finding, belong to the exclusive jurisdiction of the fact-finding court unless they go beyond the bounds of the principle of free evaluation of evidence. There is no ground to believe that the lower court’s fact-finding exceeded the scope of reasonable free evaluation of evidence in violation of logical and empirical rules. Moreover, the lower court did not err by misapprehending the legal doctrine regarding the burden of proving the existence of secured claim of the right to collateral or the admissibility

2. Regarding ground of appeal No. 2

Article 368(1) of the Civil Act does not apply to the case where a part of several real estate on which a joint mortgage is established is owned by an obligor, and where a part of the real estate is owned by a surety and is distributed at the same time, the auction proceeds of the real estate owned by an obligor shall be preferentially distributed to a joint mortgagee, and only where there is a shortage, an additional distribution shall be made from the auction proceeds of the real estate owned by a joint mortgagee (see Supreme Court Decision 2008Da41475, Apr. 15, 2010). The same shall also apply to the case where a person who has pledged to secure another’s property concurrently holds the position of

The court below is justifiable in light of the above legal principles that the court below, out of the auction proceeds of the non-party 2's shares, distributed each of the real estate in this case to the defendant, who is the first secured mortgage holder, the second secured mortgage holder, and the second secured mortgage holder, who is the second secured mortgage. The court below determined that the real estate in this case should be additionally distributed out of the auction proceeds of the non-party 1's secured debt, only for the portion not satisfied by the above amount out of the maximum debt amount of the secured debt in the defendant's name. It did not err by misapprehending the legal principles regarding the scope of application of

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 Lee Sang-hoon (Presiding Justice)