In a case where Company A received a business report from the sectional owners in an aggregate building in which the sectional owners exist, and operated a lodging business after completing a business report, and Company B received a business report from the sectional owners of some guest rooms in the same aggregate building and received a business report, and the head of the competent Gu received a business report and sought a revocation of the business report acceptance disposition against Company B, the case dismissing Company A’s claim.

In a case where Company A, in the aggregate building in which a person holding a divided ownership, sold in units, received a report on the operation of guest rooms from the persons holding a divided ownership, and operated a lodging business after completing the report on the operation of guest rooms, and the head of the competent Gu received the report on the operation of guest rooms from some persons holding a divided ownership of the same aggregate building, and the Company A sought the revocation of the disposition to accept the report on the business of Company B upon receipt of the report, the case dismissing Company A’s claim on the ground that the competent authorities do not accept the report on the business, as long as the guest rooms secured even if a large number of guest rooms exist in the aggregate building and the facilities necessary for the business are installed, and there is no reason to believe that

Articles 3(1) and 4 of the Public Health Control Act; Articles 2, 3, 3-2, and 7 of the former Enforcement Rule of the Public Health Control Act (Amended by Ordinance of the Ministry of Health and Welfare No. 173, Dec. 11, 2012);

C&C Co., Ltd. (Law Firm Cheongn Law, Attorney Gyeong-dilution, Counsel for the plaintiff-appellant)

Head of the Busan Metropolitan Government Maritime Affairs Office

[Plaintiff-Appellee] Plaintiff 1 and 1 other (Law Firm Jeong-sik et al., Counsel for plaintiff-appellee

Busan District Court Decision 2012Guhap5610 decided August 22, 2013

March 5, 2014

1. The plaintiff's appeal is dismissed.

2. The costs of appeal shall be borne by the Plaintiff.

The judgment of the first instance is revoked. The defendant's acceptance of a report on accommodation business (living) against the defendant's intervenor on October 4, 2012 shall be revoked.

1. Details of the disposition;

A. The ○○○○○ hotel located in Busan Maritime Affairs Daegu ( Address omitted) is located in the 7th basement and the 30th floor above the ground. The most underground floors are parking lots; the 1st and the 3th floor above the ground are neighborhood living facilities; the 4th floor above the ground are hotel offices and restaurants; and the 5th to 30th floor above the ground, which consists of 416 guest rooms equipped with convenience facilities, such as living rooms, washing rooms, and kitchen rooms, and these guest rooms are sold in each unit, and each unit of unit of unit of unit of unit of unit of unit of unit of unit of unit of unit of unit of each owner is separate owner (hereinafter “instant condominium”).

B. On September 22, 2009, the Plaintiff was entrusted with the operation of the entire guest rooms of the instant condominium building from the sectional owners, and operated the lodging business with a hotel, hotel office, and street facility on the fourth floor of the instant condominium building, making a report to the Defendant. The number of guest rooms entrusted with operation was changed to the 380 guest rooms on August 4, 201 and the 223 guest rooms as of July 1, 201, respectively. Accordingly, the Plaintiff reported a change in the accommodation business operation corresponding thereto.

C. On the other hand, on July 3, 2012, the Defendant’s Intervenor (hereinafter “ Intervenor”) was entrusted with operation by the sectional owners of the 168 room, including the 6th floor 617th floor among the guest rooms of the instant condominium building, and filed a report on the accommodation business with the Defendant on the part of the 617 unit and the 6th floor common area.

D. On July 3, 2012, the Defendant rejected the Intervenor’s business report of accommodation business (hereinafter “the first return disposition”) on the ground that it is not possible for the Intervenor to report the business of accommodation business to the instant aggregate building that had already been reported by the Plaintiff on January 22, 2008 pursuant to the Ministry of Health, Welfare and Family Affairs’s inquiry response (the Ministry’s Living Sanitation Team-242, hereinafter “relevant inquiry response”) on the grounds that the Plaintiff’s business report of accommodation business was not possible. The summary of the “related inquiry response” paid by the Ministry of Health, Welfare and Family Affairs as of January 22, 2008 is as follows.

Although there is no separate provision for the facilities and equipment of a lodging business under the Public Health Control Act, there is a matter to be observed by a lodging business operator, such as a certificate of report on accommodation business, and a list of guest rooms, and if a lodging business operator is subject to an administrative disposition due to a violation of the Public Health Control Act, the person who has reported the public health business is subject to administrative authority and responsibility (administrative disposition). Therefore, if a number of accommodation businesses are operated within the same area, it is difficult to abide by the matters to be observed by the business operator following the business report, and it is difficult for the proprietor (manager) to actually engage in commercial sex acts, prevention of juvenile marriage and various accidents, etc., and there is no problem of responsibility.

E. On August 22, 2012, the Intervenor reported to the Defendant on 169 room, adding one guest room to the previous 168 room, as a guest room. However, on the same day, the Defendant rejected the business report (hereinafter “the second return”) on the same day, citing the same reasons as the first return disposition.

F. An intervenor dissatisfied with this, filed an administrative appeal with the Busan Metropolitan City Administrative Appeals Commission, and was rendered a ruling of acceptance that the second return disposition on September 18, 2012 was revoked during the relevant trial proceeding. Accordingly, on October 4, 2012, the Defendant accepted the Intervenor’s report on the business of accommodation on August 22, 2012 (hereinafter “instant disposition”).

[Reasons for Recognition] Unsatisfy, Gap evidence 3 (including those numbered in each document; hereinafter the same shall apply) through 20, Eul evidence 1 to 4, the purport of the whole pleadings

2. Judgment on the main defense of this case

A. The defendant and the intervenor asserted that the plaintiff is merely a third party, not the other party to the disposition of this case, and thus, there was no standing to sue since the above disposition did not infringe legal interests.

B. A third party, who is not the other party to an administrative disposition, is entitled to a decision of propriety by filing an administrative litigation seeking the revocation of the administrative disposition, where the interests protected by law are infringed by the pertinent administrative disposition. The legal interests referred to in this context refer to individual, direct, and specific interests protected by the relevant law and regulations (see Supreme Court en banc Decision 2006Du330, Mar. 16, 2006, etc.).

Article 1 of the Public Health Control Act provides, “The purpose of this Act is to improve the level of sanitation by prescribing the matters concerning the business and the sanitary control, etc. of facilities used by the public, thereby contributing to the improvement of national health.” Article 3(1) of the same Act provides, “Any person who intends to conduct a public health business shall have facilities and equipment prescribed by the Ordinance of the Ministry of Health and Welfare by type of the public health business and report it to the head of a Si/Gun/Gu (limited to an autonomous Gu; hereinafter the same shall apply). The same shall apply to a case where he intends to modify important matters prescribed by the Ordinance of the Ministry of Health and Welfare.” Article 3-2(1) of the same Act provides, “When a public health business operator transfers the public health business or dies, or when there is a merger of corporations, the transferee, heir or the corporation surviving the merger or the corporation established by the merger shall succeed to the status of the public health business operator.” The purport of the above provision is to clarify the management authority of the public use facility or the responsible subject due to the breach of legal duty, thereby guaranteeing the property rights and rights of the public health business.

In addition, in light of the purport of the relevant laws and regulations, the instant condominium building is a place of business operating a hotel type business, with a total of 416 rooms sold in units, and there are separate owners, and it is operated in the form of an agreement that operates a lodging business by entrusting it to an entrusted business entity, such as the plaintiff or the intervenor, and the company operating the lodging business by entrusting it to the entrusted business entity, such as the plaintiff or the intervenor, but the company is operating the lodging business, and it is operated in the same building with an agreement that the plaintiff and the intervenor shall pay the sectional owners a profit. Accordingly, the Plaintiff and the intervenor may have a direct competition with the plaintiff and the entrusted business entity to secure guest rooms. Accordingly, the benefits affected by the instant disposition are not merely a mere anti-private interest in accordance with the administrative disposition, but also a direct and specific interest that may be legally protected.

C. Therefore, the plaintiff is qualified to seek revocation of the disposition of this case, and the above assertion by the defendant, etc. based on the different premise is without merit.

3. Whether the disposition is lawful;

A. The plaintiff's assertion

The disposition of this case shall be revoked on the grounds that the following illegal grounds exist:

1) If there are multiple lodging business entities in an aggregate building, it is difficult for them to comply with the requirements required by the relevant laws, such as the Public Health Control Act, and the subject of responsibility to whom responsibility belongs becomes ambiguous and the supervision of administrative agencies is difficult, a number of lodging business entities in the aggregate building in this case

2) The Intervenor installed a entertainment room and a street facility on the 6th floor of the instant condominium building. Since the Intervenor does not have the right to exclusively use the said section, it is illegal to install the said facility. The Intervenor’s report based on such unlawful facility should not be accepted.

3) The intervenor did not secure the right to use the 12 guest rooms among the guest rooms for which the Plaintiff had already reported as the place of business, and filed a report without being equipped with the facilities and equipment to distinguish the lodging business entity.

B. Relevant statutes

It is as shown in the attached Form.

C. Determination

1) Determination as to whether to report the business of multiple accommodation business entities (the above A. 1)

A) As seen earlier, the direct purpose of the Public Health Control Act is to “to contribute to improving the level of hygiene by prescribing matters concerning the hygiene management, etc. of businesses and facilities used by the public” (Article 1). To achieve such purpose, a person who intends to conduct a public health business pursuant to Articles 3, 4, and 2, 3, 3-2, and 7 of the Enforcement Rule of the Public Health Control Act (amended by Ordinance of the Ministry of Health and Welfare, No. 173, Dec. 11, 2012) shall be equipped with facilities and equipment necessary for the business, and a person who intends to conduct a public health business shall file a report thereon, and the duty to report shall also be imposed on the business facilities and equipment, and the business facilities and equipment shall be kept sanitary and safe. Such sanctions shall be imposed (see, e.g., Articles 10, 11, and 11-2 of the Public Health Control Act). Furthermore, a transferee of a public health business shall succeed to the status of the business entity (see, referring to Article 13-2 of the Public Health Control Act).

B) In light of the contents of the relevant provisions, examining whether a person has facilities and equipment necessary to run a public health business and allowing the business to conduct such business falls under the so-called “material disposition,” and can be deemed to be subject to the main management of the relevant statutes.

According to the above evidence, an intervenor is recognized as having filed a business report by meeting the physical facilities and requirements required in the relevant provisions, such as establishing a guest room in the sixth floor and a part of the street, specifying the entrusted 169 guest rooms, and filing a report on the place of business. Furthermore, in the instant aggregate building, in the event a large number of companies in the instant aggregate building violate the relevant Acts and subordinate statutes among the attempts to operate a lodging business, each place of business has already been specified, and thus, there is no problem in determining the cause, place, and place of responsibility.

C) The Plaintiff is operating with entrustment to most recent guest rooms gradually reduce the number of entrusted guest rooms. The fact that the Intervenor secured a considerable number of entrusted guest rooms and made the instant report on the instant business is as seen earlier.

The instant condominium building becomes different from each owner of each guest room by selling it to an individual. Accordingly, insofar as the ownership of the entire guest room is not secured, the owner of each guest room may freely entrust his/her guest room to a person deemed appropriate according to his/her own will for business purposes. In light of these characteristics of the business, the owner of each guest room shall be allowed to freely entrust his/her guest room to a person entrusted with the business for the purpose of business, except in cases where the number of guest rooms is extremely low, and if it does not fall under such cases, the owner of each guest room may report and operate his/her business jointly with the existing place of business in accordance with the prescribed procedure if he/she is equipped with the facilities prescribed in the relevant Acts and subordinate statutes. As long as the securing of the guest room even if a large number of business operators exist together, there is no reason to accept the report of business as well as any other administrative agency that may be confused with the administrative facility standards, and there is no possibility that any other administrative business operator may be confused with such administrative business operator after the commencement of the business (if any other administrative measure is contrary to the relevant laws and regulations).

D) Prior to the instant disposition, the previous Ministry for Health, Welfare and Family Affairs has interpreted that a number of reports on the business of accommodation businesses in an aggregate building is not possible on the grounds of confusion with the subject of responsibility for various matters to be observed through the response to relevant inquiries, and occurrence of juvenile problems arising from the business operator’s emergency order. However, such interpretation is merely a mere administrative interpretation of higher administrative agencies, and thus it cannot be external binding power, and it is difficult to deem that such interpretation is an inherent problem arising from the receipt of multiple business reports in an aggregate building. Therefore, the answer to the pertinent question cannot be a ground for illegality of the instant disposition.

E) Meanwhile, the Plaintiff asserts that, in relation to the details of a specific report, the indication of the place of business of the instant aggregate building should be separately stated in the “Written Outline of Facilities and Equipment,” accompanied by a business report, and that it is unlawful for the Intervenor to combine the size of the exclusive ownership and the share size of the joint ownership according to the ratio of that exclusive ownership and that the size of the joint ownership should be reported as the area of the business site. However, in light of the relevant provisions of the Act on the Ownership and Management of Aggregate Buildings, a sectional owner may use the joint ownership according to the ratio of the exclusive ownership area, and the allocation of the area among the joint ownership area is prescribed in the ratio of the exclusive ownership area (see, e.g., Articles 11, 12, etc.), it cannot be deemed that the Intervenor reported as above, and even if there were such errors in the said indication, it cannot be

F) As seen above, the Plaintiff’s above part’s assertion is without merit or merit.

2) Determination as to whether the section for common use is illegally used (A. 2)

A) In addition to the above evidence, considering the facts found in Gap evidence No. 22, considering the facts acknowledged by the above evidence, it cannot be deemed that the intervenor illegally uses the above part, taking into account not only the guest rooms secured by the intervenor but also the fact that the participant can freely use the above six-story part, such as the waiting room, passage, etc., but also the waiting room and the common area used for the above six-story part. The participant was entrusted with the operation from the sectional owners of the 169 room among the 419 guest rooms of the instant aggregate building, the participant secured the right to use the common area corresponding to the area ratio.

B) Furthermore, the defendant may examine whether the intervenor has the requirements for accommodation business under the relevant laws and regulations and determine whether to accept the report. If the intervenor loses the right to use the above section for common use and fails to have the facilities required under the relevant laws and regulations, it is possible to impose ex post facto sanctions such as the closure of the place of business. Therefore, as long as the intervenor is assessed to have the facilities and equipment required under the relevant laws and regulations at the time of filing the report on accommodation of this case, the defendant need not comply with the legitimacy of the licensee.

C) Therefore, the Plaintiff’s above assertion is without merit.

3) Determination as to whether the main body of business, such as double reporting, is confused (see the above A. 3)

A) According to the above evidence, 12 rooms among 169 rooms reported by the Intervenor to the guest room for the entrusted operation while reporting the business of accommodation and reporting the business of accommodation, are recognized as overlap with the Plaintiff’s business room for the entrusted operation. However, as seen earlier, the owner of each guest room may choose a business operator who will be entrusted with the entrusted operation according to his/her own will. However, in the case of the overlapping entrusted guest room, even though the entrusted operation contract was terminated without the Plaintiff’s report on changes, it is possible for the Intervenor to have entrusted the entrusted operation contract without the Plaintiff’s report on changes and maintain the report on the guest room. Thus, it is difficult to view that the Defendant has a duty to decide on whether to accept the report by making the truster’s genuine intent at the time of the receipt of the report, and it is difficult to determine whether to accept the entrusted guest room partially because it is merely 12 rooms and it is impossible to confirm the genuine intent of the parties after taking account of the fact that the contract for entrusted operation was terminated.

B) Furthermore, according to the above evidence, the entrance of the aggregate building of this case, signboards with four stories in width of the hotel operated by the plaintiff, and signboards with six stories in the entrance of the first floor of the elevator of this case with six stories in the hotel room operated by the intervenor are set up respectively. On the entrance of the first floor and the front of the elevator for the first floor of the first floor, a notice is posted "(main) guidance map by ○○○○○○○○ by floor" indicating all guest rooms operated by the intervenor by a participant by a day, and on the inside of the elevator for the hotel, the fact that the name of the intervenor is indicated by the plaintiff and the intervenor by door is indicated in the guest room operated by the intervenor under entrustment. Considering the fact that the intervenor installed the guest room at the entrance of the first floor of this case and the part of the office, the guest room at the entrance of the first floor of this case, as seen earlier, it is unlikely for the intervenor to confuse the main body of the lodging business.

C) Therefore, the Plaintiff’s assertion on this is without merit.

4. Conclusion

Therefore, the plaintiff's claim is dismissed as it is without merit, and the judgment of the court of first instance is just with this conclusion, and the plaintiff's appeal is dismissed as it is without merit.

[Attachment] Relevant Statutes: omitted

Judges Gunam-su (Presiding Judge)