[1] Whether Article 398 (2) of the Civil Code can be applied on the premise that a standardized contract clause is valid where the standardized contract clause is invalid under the Act on the Regulation of Terms and Conditions (negative)

[2] The validity of a standardized contract that imposes unfairly excessive liability or penalty on a customer (negative)

[3] The case holding that a contract clause which provides that the lessee shall pay 10% of the deposit to the lessee as a penalty in the event the lessee has terminated the contract due to the overdue overdue charge of the lessee at the rate of 5% (60% per annum) per annum, and the lessee shall be deemed null and void pursuant to Articles 6 and 8 of the Regulation of Standardized Contracts Act

[1] In a case where a standardized contract clause is null and void under the Act on the Regulation of Terms and Conditions, the amount of damages calculated by applying Article 398(2) of the Civil Code to the extent appropriate, on the premise that it is valid, shall not be reduced to the extent appropriate, or the remaining parts of the portion reduced to impose excessive liability

[2] In light of the provisions of Articles 6 and 8 of the Regulation of Standardized Contracts Act, a standardized contract clause that imposes unfairly excessive liability or penalty on a customer shall be presumed to have lost fairness due to unfair disadvantage to the customer, and shall be deemed null and void as it goes against the principle of good faith.

[3] The case holding that Article 6 and Article 8 of the Regulation of Standardized Contracts Act can be deemed null and void as a standardized contract clause, which provides that the lessee shall pay 10% of the deposit to the lessee as a penalty if the contract has been terminated on the grounds of the contract clause which provides that the lessee shall pay the overdue charge of 5% (60% per annum) per annum to the lessee for the overdue overdue overdue overdue overdue overdue overdue overdue overdue overdue overdue overdue overdue overdue overdue overdue overdue overdue overdue overdue overdue overdue overdue overdue overdue overdue overdue overdue overdue overdue overdue overdue overdue overdue debts, is presumed to be unfair as a clause unfavorable to the lessee, and thus violates the principle of trust

[1] Article 398 (2) of the Civil Code / [2] Articles 6 and 8 of the Regulation of Standardized Contracts Act, Article 2 of the Civil Code / [3] Articles 6 and 8 of the Regulation of Standardized Contracts Act, Article 2 of the Civil Code

[1] [2] Supreme Court Decision 96Da19758 delivered on September 10, 1996 (Gong1996Ha, 309) / [2] Supreme Court Decision 97Da56969 delivered on April 24, 1998

Plaintiff

Defendant (Law Firm International, Attorneys Kim Tae-tae et al., Counsel for the defendant-appellant)

Changwon District Court Decision 2008Na12228, 12235 decided February 13, 2009

The part of the lower judgment against the Defendant (Counterclaim Plaintiff) is reversed, and that part of the case is remanded to the Changwon District Court Panel Division.

The grounds of appeal are examined.

1. Regarding ground of appeal No. 1

Article 628 of the Civil Code provides that if the rent agreed upon due to the increase or decrease in the public burden on the leased object or any other change in the economic situation has become unreasonable, the parties may demand an increase or decrease in the rent for the future. Accordingly, the court below's determination that the court below's determination on the assertion by the defendant (Counterclaim Plaintiff; hereinafter "the defendant") is insufficient to recognize that there was a significant change in circumstances which served as the basis for calculating the rent at the time of the lease agreement, based on the evidence duly admitted by the court below in light of the evidence, etc. adopted through legitimate evidence examination, and there is no violation of the rules of evidence

2. Regarding ground of appeal No. 2

Without being asserted in the lower court, a new argument in the final appeal cannot be a legitimate ground for appeal against the lower judgment (see, e.g., Supreme Court Decision 2001Da63575, Jan. 25, 2002). According to the records, it can be known that the Defendant did not assert that Article 7(2) of the instant lease agreement as stated in the lower court’s holding until the closing of argument constitutes Article 11 subparag. 1 of the Regulation of Standardized Contracts Act and thus, this part of the grounds for appeal cannot be a legitimate ground for appeal.

3. As to the third ground for appeal

According to the judgment of the court below and the records, the court below asserted that the late payment charge agreement under Article 5 (3) of the lease agreement of this case is absolutely unfavorable to the lessee who is the economically weak, and is null and void as a clause that imposes liability on the lessee for damages, etc. unfairly excessive late payment damages, etc. on the lessee under Article 8 of the Regulation of Standardized Contracts Act. The above late payment charge agreement does not constitute a juristic act contrary to good morals and other social order merely with the fact that the late payment charge agreement imposes on the lessee the late payment charge if it delays the monthly rent. However, since the above late payment charge agreement is presumed to be liquidated damages pursuant to Article 398 (4) of the Civil Act, it is presumed that it is reasonable for the court to reduce it as reasonable under Article 398 (2) of the Civil Act. Since the above late payment charge agreement is excessively excessive in light of the size of the damage amount and the ratio of the debt amount, it is reasonable to reduce it by 20% per annum. It is not determined as to whether it is null and void under Article 8

However, under the Act on the Regulation of Terms and Conditions, if a standardized contract is null and void, it cannot maintain its validity only with the remaining parts that reduced the estimated amount of damages to an appropriate extent by applying Article 398(2) of the Civil Act, or reduced the amount that imposed an excessive liability to compensate for damages (see, e.g., Supreme Court Decision 96Da19758, Sept. 10, 196). On the other hand, imposing late payment charges on the lessee's monthly overdue arrears amounting to 5% (60% per annum) of the monthly (see, e.g., Supreme Court Decision 200Da1828, 18295, Jul. 6, 200). It is reasonable to view it as invalid by Articles 6 and 8, etc. of the Regulation of Terms and Conditions Act (see Supreme Court Decision 200Da1828, 1829

Therefore, the judgment of the court below is erroneous in the misapprehension of the judgment as to this part of the defendant's assertion that the above late payment charge agreement is null and void by Article 8 of the Regulation of Standardized Contracts Act, which affected the conclusion of the judgment. Therefore, the ground of appeal pointing this out is with merit.

4. As to the fourth ground for appeal

Article 6(1) of the Regulation of Standardized Contracts Act provides that "any standardized contract which has lost fairness against the principle of trust and good faith shall be null and void." Article 6(2) provides that "if a standardized contract provides for any of the following matters, the standardized contract provision shall be presumed to have lost fairness," and subparagraph 1 provides that "any clause which is unreasonably unfavorable to customers shall be deemed to be null and void." Article 8 provides that "any standardized contract that imposes an obligation on customers to compensate for losses, etc. unfairly excessive and excessive damages, etc." Thus, a standardized contract clause that imposes unfair excessive compensation or penalty on customers shall be presumed to be unfair disadvantageous to customers and thus null and void as it violates the principle of trust and good faith (see, e.g., Supreme Court Decisions 96Da19758, Sept. 10, 1996; 97Da56969, Apr. 24, 1998).

According to the reasoning of the judgment below, the court below held that the penalty stipulated in Article 16 (3) of the instant lease agreement should be deemed as a penalty agreement, and that the penalty agreement cannot be deemed as an liquidated damages stipulated in Article 8 of the aforementioned Act, and that the penalty provision cannot be deemed as a clause that imposes unfairly excessive liability on the customer.

However, in light of the above legal principles, we cannot agree with the judgment of the court below for the following reasons.

First of all, even if the penalty stipulated in Article 16 (3) of the lease agreement of this case is regarded as a so-called penalty for breach of contract, as long as it is a standardized contract clause, it is subject to the application of Articles 6 and 8 of the Regulation of Standardized Contracts Act as seen earlier.

In addition, according to evidence, etc. adopted by the lower court and the lower court through legitimate examination of evidence, etc., the contract may be rescinded or terminated in the event that the monthly rent is overdue for at least two months, etc. under Article 16(1)(f) of the instant lease contract. Paragraph (3) of the same Article requires the lessee to pay 10% of the deposit money as penalty if the contract is rescinded or terminated due to a cause falling under any of the subparagraphs of paragraph (1). Paragraph (4) of the same Article provides that the lessee shall compensate for actual damages due to a cause falling under each subparagraph of paragraph (1) separate from the penalty under paragraph (3). Paragraph (3) of Article 5 provides that the lessee shall pay a high rate of late rent arrears. The instant lease agreement does not provide for an estimate of the amount of compensation for damages or penalty for breach of Article 16(1) of the Act, and it is unreasonable to require the lessee to return the deposit money after the completion of its restoration to the original state, and it can be seen that there is no other unfair provision on the lease or late payment of damages.

Nevertheless, the court below determined that Article 16 (3) of the lease agreement of this case does not violate Article 8 of the above Act on the grounds as seen earlier. Thus, the court below erred by misapprehending the legal principles on Articles 6 and 8 of the Regulation of Standardized Contracts Act, which affected the conclusion of the judgment. Therefore, the defendant's ground of appeal pointing this out is with merit.

5. Conclusion

Therefore, the part of the lower judgment against the Defendant is reversed, and that part of the case is remanded to the lower court for a new trial and determination. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Kim Yong-dam (Presiding Justice)