Whether permission for use of the administrative property before its disuse ceases to exist in cases where the administrative property becomes general property due to its disuse (affirmative); and in such cases, whether permission for use or usage can be imposed on the basis of Article 22 of the former Public Property and Commodity Management Act (negative)

Articles 5(1) and (3), 19(1), 20(1), 22(1), 28(1), and 32(1) of the former Public Property and Commodity Management Act (Amended by Act No. 1006, Feb. 4, 2010);

Distribution 2 Complex Housing Reconstruction and Improvement Project Association (Law Firm Square et al., Counsel for the defendant-appellant)

The head of Seocho-gu Seoul Metropolitan Government (Law Firm LLC, Attorneys Park Sang-hoon et al., Counsel for the plaintiff-appellant)

Supreme Court Decision 2010Du22252 Decided February 24, 2011

Seoul High Court Decision 2011Nu9395 decided February 3, 2012

The judgment below is reversed and the case is remanded to Seoul High Court.

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

1. The former Public Property and Commodity Management Act (amended by Act No. 1006, Feb. 4, 2010; hereinafter “Public Property Act”) classify public property into administrative property and general property according to its use (Article 5(1)); determine all public property other than administrative property as general property (Article 5(3)); and (2) restrict disposal, etc. by prohibiting lending, sale, exchange, trust, payment in kind, trust, payment in kind, or not from establishing private rights for such property without any purpose (Article 19(1) main text): Provided, That the head of a local government may permit use or profit-making within the extent that does not interfere with its purpose or purpose; when using or making profit-making from public property, he/she shall collect usage fees in accordance with the rate and method prescribed by Presidential Decree (Articles 20(1) and 22(1)3); and (3) shall not be permitted to lease, exchange, or transfer general property, or to establish the rate or profit-making method of use or profit-making in kind as prescribed by Presidential Decree (Article 19(1).2).

In addition, even if administrative property is closed for public use, the nature of the administrative property is lost and its restriction under the Public Property Act is extinguished, and the permission for use or profit-making of the administrative property corresponding to a patent in terms of lectures is extinguished. Permission for use or profit-making by the head of a local government is granted to the extent that it does not interfere with its purpose or purpose, and permission for use or profit-making of the administrative property is granted to the extent that it does not interfere with the administrative property subject to administrative property. If the administrative property is abolished and used as general property such as the site for reconstruction apartment, it is impossible to permit use or profit-making to the extent that it

In addition, since administrative laws and regulations, such as imposition of fees recognized in cases where permission for use or profit-making is imposed on administrative property, should be strictly interpreted and applied. Thus, it violates the principle of reservation of administrative laws and the clarity of administrative law, instead of going through the procedure of making a loan contract with respect to general property and collecting rent based on it, to interpret that the use fee can be unilaterally imposed by the administrative disposition of the head of local government.

Therefore, in full view of the provisions of the Public Property Act dealing with administrative property and general property differently and the relevant legal principles, it is reasonable to interpret that permission to use the administrative property prior to disuse is extinguished if the administrative property becomes general property due to disuse and that no usage fee cannot be imposed on the basis of such permission to use or Article 22 of the Public Property Act.

2. According to the reasoning of the lower judgment and the evidence duly admitted, the Plaintiff applied for permission to use the instant park site, which is administrative property, upon filing an application for authorization to implement the instant project. The Defendant rendered permission to use the instant park site on December 31, 2004; (2) the instant park site was discontinued on January 5, 2005, which is the date the authorization to implement the instant project was given; and (3) the Defendant rendered the instant disposition imposing usage fees of KRW 16,941,323,390 on the instant park site on May 20, 209, based on Article 22 of the Public Property Act, on May 20, 2009, on the basis of the Plaintiff’s use of the instant park site, from March 7, 2006 to July 15, 2009.

Examining these facts in light of the legal principles as seen earlier, inasmuch as the instant park site was abolished on January 5, 2005 and became general property, the Defendant cannot impose usage fees on the instant park site based on the above permission for use or Article 22 of the Public Property Act previously conducted, and thus, the instant disposition is unlawful as it was conducted without any legal basis.

3. Nevertheless, the lower court determined otherwise on the erroneous premise that even if the instant park site was abolished as a park and general property was not extinguished, the use fee for the instant park site may be imposed on the Plaintiff based on Article 22 of the Public Property Act.

Therefore, in so determining, the lower court erred by misapprehending the legal doctrine on the subject of imposition of usage fees under Article 22 of the Public Property Act, thereby adversely affecting the conclusion of the judgment. The Plaintiff’s ground of appeal assigning this error is with merit.

4. Therefore, without examining the remaining grounds of appeal by the Plaintiff and the Defendant’s grounds of appeal, we reverse the judgment of the court below, and remand the case to the court below 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 So-young (Presiding Justice)