Wangsan New Town, Seoul Housing Redevelopment and Improvement Project Association (Attorney Park Il-il et al., Counsel for the plaintiff-appellant-appellee)

The head of Seongdong-gu Seoul Metropolitan Government (Law Firm branch, Attorneys Kim Jong-tae et al., Counsel for the defendant-appellant)

June 8, 2011

Seoul Administrative Court Decision 2008Guhap3785 Decided June 4, 2009

1. Revocation of a judgment of the first instance;

2. Of the conditions attached to the approval disposition of a housing redevelopment project implemented by the Defendant on August 10, 2007 by the Plaintiff on August 10, 2007, the size of the disuse of land excluded from the transfer subject to free transfer due to the response of the decision of free transfer of State-owned or public land in 1, 2008 and 12,631.18 square meters, among the conditions attached to the approval disposition of a housing redevelopment project implemented by the Defendant on August 10, 2007;

(a) dismiss the action on the part of the land listed in [Attachment 1] Nos. 1 to 12;

B. The remaining part of the claim is dismissed.

3. The plaintiff's preliminary claim added at the trial shall be dismissed.

4. All costs of the lawsuit shall be borne by the Plaintiff.

1. Purport of claim

Of the conditions attached to the authorization disposition issued by the Defendant on August 10, 2007 for implementing a housing redevelopment project, the Defendant primarily cancelled the area of 12,631.18 square meters of the disuse that is excluded from the transfer subject to free transfer due to the response of free transfer of the State-owned or public land in 1, 2008, which was notified to the Plaintiff on August 6, 2008, and the Defendant filed a claim for the cancellation of the said ancillary parking lot from the Plaintiff (hereinafter referred to as the “instant parking lot”) of 5,771.3 square meters of the disuse that is excluded from the transfer subject to free transfer due to the response of free transfer of the State-owned or public land in 1, 2010, which was notified to the Plaintiff on November 11, 2010, and 5,771.3 square meters of the land excluded from the transfer subject to free transfer due to the response of free transfer of the State-owned or public land in Seongdong-gu.

2. Purport of appeal

The judgment of the first instance is revoked. The plaintiff's claim is dismissed.

1. Details of disposition;

A. On December 22, 2006, the Plaintiff is a housing redevelopment improvement project association that obtained authorization for establishment from the Defendant on December 22, 2006 for the purpose of implementing a housing redevelopment project by making the housing redevelopment project district of 100,586m2 (100,666.39m2 according to the result of the cadastral survey) as a project district.

B. The Plaintiff prepared a project implementation plan on June 2007 and submitted it to the Defendant for authorization to implement the project. According to the project implementation plan, among the State-owned and public land totaled of 18,769m24m2 (18,731m21m2) incorporated into the project implementation district, the rearrangement infrastructure for disuse is 12,046m29m29, and the instant parking lot 1,014m2. The rearrangement infrastructure for new installation is 3,972.58m2, green area 2,454m2, park 2,840m2, park 2,840m2, and 39,000m2 (the total area is 9,952,068,600m2). The Plaintiff did not request the management agency of the Seoul Special Metropolitan City on July 20, 207 that the instant parking lot was located within the scope of 31,7819m25,298,581m2.

C. On August 10, 2007, the Defendant: (a) attached various conditions to each department while approving a project implementation plan submitted by the Plaintiff (hereinafter “instant project implementation authorization”); (b) assigned state-owned property (the jurisdiction of the Ministry of Finance and Economy) to the finance department without compensation; (c) determined the transfer portion of state-owned property and public-owned property (the Ministry of Construction and Transportation, Seoul Special Metropolitan City, and the jurisdiction of the Defendant) pursuant to Article 65(2) of the former Urban Improvement Act; and (d) purchased state-owned or public-owned land within the project zone after the commencement of the project implementation authorization (paragraph (2); and (d) purchased state-owned or public-owned land within the project zone after the commencement of the project implementation authorization (the term “instant authorization conditions”). On February 21, 2008, the Defendant changed the area of the rearrangement infrastructure newly installed to 4,011 square meters, green area 2,480 square meters, park size 2, 1094, 309, 195 square meters (209, m25, 109).5).

D. On June 10, 2008, the Defendant requested a re-consultation on the transfer of 11,520.57 square meters [1,520.89 square meters in the Ministry of Finance and Economy, 156 square meters in the Ministry of Construction and Transportation, 1,315 square meters in the Seoul Special Metropolitan City, 9,169.68 square meters in total, 29,898, 153,100 square meters in the appraisal value] among the fundamental infrastructure subject to disuse (road), along with a cadastral survey result map and an appraisal report on the changed fundamental infrastructure. On August 6, 2008, the Defendant issued a request for re-consultation on the transfer of 10,000 square meters in 2,179,574,147, 147, 199, 50-19, 37, 375, 381, 375, 97, 97, 97, etc.197.

E. On November 11, 2010, the Defendant (a housing department) had a consultation with the Defendant (financial department) to transfer the floor area ratio without compensation to the Plaintiff within the full amount of KRW 36,643,452,50 for the cost of installing infrastructure for rearrangement, which did not deduct the amount of compensation for the floor area ratio, but the Defendant (a housing department) notified the Plaintiff of the purport of selling only the 4,613.48 square meters of land for public use (a total of KRW 12,815,520,20, and detailed details as indicated in the attached Table 2) and the remaining 5,771.3 square meters of land for the remainder of 771.3 square meters (hereinafter “instant decision”).

[Ground of recognition] Facts without dispute, Gap 1 to 3, 5, 6, Eul 1 to 17, the whole purport of the pleading

2. Determination on the defense prior to the merits

A. Defendant’s assertion

1) In a lawsuit seeking confirmation of invalidity of the disposition of authorization to establish an association filed by a part of the Plaintiff against the Plaintiff (Seoul Administrative Court 2009Guhap1945), the first instance court rendered a ruling that the Defendant’s establishment authorization was revoked on December 22, 2006, the instant disposition for authorization to establish an association on August 14, 2007, the instant disposition for authorization to implement the project on September 10, 208, and each disposition for the management and disposal plan rendered on September 10, 208, respectively, by holding a general meeting on April 23, 2010, and resolved to revise an establishment change, a project implementation plan, and a management and disposal plan. Upon the Plaintiff’s request, the Defendant modified the previous disposition for authorization to establish an association on May 14, 2010, and the previous disposition for authorization to alter the management and disposal plan on February 16, 2011.

After the judgment of the court that the previous establishment authorization disposition against the plaintiff was null and void, the authorization was issued on May 14, 2010, and it is not recognized as identical between the plaintiff and the new association that received the authorization for establishment authorization. Thus, the plaintiff is not a party to the lawsuit of this case.

2) The Plaintiff received a disposition to newly approve the establishment of a partnership after a disposition to approve the establishment of a partnership, and the instant decision No. 2 concerns a disposition to authorize a new association to implement a project. As such, the basic facts differ from the previous association and the instant order No. 1 concerning the disposition to approve the establishment of a new association. Of the litigation concerning the revocation of the instant decision No. 1, the modification of the lawsuit adding the claim for revocation of the instant decision No. 2

3) The decision Nos. 1 and 2 of this case merely notified the Plaintiff of the result of free transfer consultation (Article 66(1) of the Act on the Maintenance and Improvement of Urban Areas and Dwelling Conditions) made at the Plaintiff’s request, or did not constitute a disposition imposing a certain burden on the Plaintiff, by means of a private contract (Article 66(4) of the Act on the Maintenance and Improvement of Urban Areas and Dwelling Conditions). Even if the authorization conditions attached to the disposition on the authorization of the project implementation of this case are deemed to be borne by the administrative law, 90 days have already elapsed, which is the period for filing a lawsuit as stipulated in Article

B. Determination

1) As to the first argument

Where an authorization for modification was issued after the initial authorization for establishment was issued, only the changed portion among the original authorization disposition becomes invalid, and each of the above authorization dispositions concurrently exist, and it does not constitute a non-existence of the original authorization disposition as absorption of the modified authorization disposition (see Supreme Court Decision 2009Du4913, Dec. 9, 2010).

The facts alleged by the Defendant in the relevant case are: (a) the first instance judgment was rendered (However, the purport of cancelling the first instance judgment (this court ruling was rendered on July 15, 201, which was after the closure of pleadings at the trial; (b) the purport of dismissing all the plaintiffs' claims, including the additional part at the appellate court; and (c) the purport of dismissing all the plaintiffs' claims), as alleged by the Defendant after the said judgment was rendered; (d) there is no dispute between the parties. However, it is difficult to readily conclude that the disposition of authorization for establishment against the Plaintiff is null and void or that there is no identity between the union and the union that received the initial disposition of authorization for modification. Furthermore, the Plaintiff’s claim for revocation is entitled to seek revocation of the authorization conditions against the Plaintiff on August 10, 207 (the main part of the original disposition of authorization for modification was changed and the previous disposition for authorization was not deemed null and void). This part of the Plaintiff’s claim is without merit).

2) As to the second argument

Notwithstanding the disposition to approve the establishment of an association against the Plaintiff, the original disposition to approve the establishment of an association does not lose its validity, and there is no evidence to acknowledge that the Plaintiff received a new disposition to authorize the establishment of an association after the disposition to approve the establishment. The decision Nos. 1 and 2 of this case is identical to the basic facts because it partially modifies and determines the scope of the fundamental infrastructure for the disuse (road status) transferred without compensation to the Plaintiff among the conditions of authorization attached to the disposition to approve the establishment of this case as follows.

3) As to the third argument

According to Article 65(2) of the former Act, an infrastructure for rearrangement newly installed by a housing redevelopment and rearrangement project association as a result of the implementation of a rearrangement project shall gratuitously vest in the State or a local government to manage such infrastructure, and an infrastructure for rearrangement owned by the State or a local government to be disused by the implementation of a rearrangement project shall be transferred gratuitously to the project implementer to the extent equivalent to the installation cost of the newly installed infrastructure. In full view of the provisions of Articles 28(1) and 65(3) and (4) of the former Act and Article 41(2)11 and 12 of the former Enforcement Decree of the Act, including the infrastructure for rearrangement to be disused, the object and value of the State or public land to be purchased by the project implementer shall, in principle, be determined at the time of

The Defendant, at the time of authorization for the instant project implementation, failed to submit accurate survey results on the fundamental infrastructure newly installed at the time of authorization for the instant project implementation, determined the scope of gratuitous transfer and sale of the fundamental infrastructure for the disuse that the Plaintiff requested to be transferred without compensation through the instant authorization conditions, and decided to sell the remainder of state-owned and public land incorporated in the project implementation district to the Plaintiff. The Defendant subsequently determined the scope of commercial transfer and sale of the fundamental infrastructure for the disuse (road) reserved as above due to the instant first decision, but partly modified the scope by the instant second decision.

The instant authorization conditions basically provide that the Plaintiff shall purchase the part excluded from the decision of free transfer among state-owned and public land incorporated in the project implementation district. As such, the Plaintiff’s purchase of the remaining land, excluding the fundamental infrastructure for disuse (current roads) among state-owned and public land incorporated in the project implementation district, is already determined at the time of the disposition of the instant project implementation authorization, but the specific scope of free transfer and sale of disused fundamental infrastructure (current roads) was determined only by the first and second orders of this case. Therefore, the period of filing a lawsuit against the remaining land, excluding the fundamental infrastructure for disuse (current roads) among state-owned and public land incorporated in the project implementation district, has run from the time of the project implementation authorization of this case, but the period of filing a lawsuit against disuse (current roads) runs from the time

The Plaintiff’s primary claim pertains to the scope of gratuitous transfer and sale of infrastructure for rearrangement (road status) that was determined in accordance with the instant decision, and is obvious in the record that was filed within 90 days from the date of the decision. The Plaintiff sought revocation of the instant parking lot included in the site for project implementation as a preliminary claim. However, the Plaintiff’s determination of the scope of gratuitous transfer and sale was deferred due to the instant authorization condition, which was limited to the current status among fundamental infrastructure for rearrangement, and the Plaintiff’s obligation to purchase the remainder of state-owned and public land at the time of authorization for project implementation. The instant authorization for project implementation and public notice was made on August 10, 2007, and the Plaintiff was aware of the instant authorization condition at that time. According to the records, the Plaintiff added the instant preliminary claim on February 7, 2011.

The primary claim of this case complies with the period for filing a lawsuit (However, as seen in the judgment on the merits, only some of the subject of revocation sought by the plaintiff according to the decision of this case was accepted and there is no interest in the lawsuit), and the preliminary claim of this case is unlawful after the period for filing a lawsuit expires

3. Whether the disposition is lawful;

A. Plaintiff’s assertion (related to the principal claim)

Article 65(2) of the former Act on the Maintenance and Improvement of Urban Areas and Dwelling Conditions for Residents provides that a project operator shall gratuitously transfer the fundamental infrastructure that is disused to the extent of “the amount calculated by deducting the amount of compensation for the floor area ratio from the cost of installing the new fundamental infrastructure.” The latter part of Article 65(2) of the former Act on the Maintenance and Improvement of Urban Areas and Dwelling Conditions for Residents provides that a project operator shall gratuitously transfer the fundamental infrastructure that is disused to the extent equivalent to the cost of installing the newly installed fundamental infrastructure, and does not include the grounds for limiting the amount of compensation calculated by subtracting the amount of compensation for the floor area ratio from the cost of installing the newly installed fundamental infrastructure. The first decision of this case is unlawful against the latter part of Article 6

(b) Related statutes;

Attached Table 1 is as stated in the relevant Acts and subordinate statutes.

C. Determination

On the grounds alleged by the Plaintiff, the Defendant: (a) transferred only 13,519.67 square meters of fundamental infrastructure (including 1,852.4 square meters) for the maintenance of use incorporated into a project implementation district without compensation; and (b) made the instant decision 1, which is the purport of selling the remaining 12,631.18 square meters of land, as indicated in the attached Table 1; (c) as seen earlier; (d) the Plaintiff sought revocation of the entire portion excluded from the transfer without compensation; (b) the Defendant, upon the instant decision 2, made a public announcement of route approval, etc., included the portion of 4,604.8 square meters used directly as a road for public use (attached Table 2,613.48 square meters of land under the jurisdiction of Seongdong-dong, which was included in the instant decision 1); and (c) there is no evidence to acknowledge that the portion of the main claim 4,604 square meters is unlawful; and (c) there is no reason to recognize the remainder of the portion of land subject to transfer without compensation.

4. Conclusion

The judgment of the first instance court shall be revoked. Among the plaintiff's primary claims, the lawsuit on the part of the land listed in the attached Table 1 Nos. 1 through 12 is dismissed from among the area of disuse 12,631.18 square meters excluded from the transfer without compensation pursuant to the decision of this case concerning the authorization conditions of this case among the plaintiff's primary claims, and the remaining part of the claim is dismissed. The plaintiff's preliminary

[Attachment]

Judges Kim Jong-dae (Presiding Judge)

1) In the process of implementing the instant project, the Defendant raised the floor area ratio by compensating the Defendant for the construction of fundamental infrastructure, but converted the economic value therefrom.

2) It is a result of reflecting the purport of Supreme Court Decision 2007Du1699 Decided June 28, 2007 that the latter part of Article 65(2) of the former Act cannot be excluded from the application according to the amount of compensation for the floor area ratio.

3) Article 65(2) of the former Act provides that “The infrastructure owned by the State or a local government that is gratuitously transferred to a project implementer” refers to the infrastructure owned by the State or a local government that has been already determined by an urban management plan under the National Land Planning and Utilization Act prior to the authorization for the implementation of a rearrangement project, which reflects the purport of Supreme Court Decision 2007Du24289 Decided November 27, 2008.