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. Whether the plaintiffs' preferential right to convert to lots has ceased to exist

A. Article 21(1) of the Rental Housing Act (amended by Act No. 11690, Mar. 23, 2013; hereinafter “Rental Housing Act”) provides that “If a lessee fails to comply with the conversion for sale in lots for at least six months after obtaining approval for conversion for sale in lots under paragraph (4), a rental business operator may sell the relevant rental house to a third party, as prescribed by Ordinance of the Ministry of Land, Transport and Maritime Affairs, in accordance with the Ordinance of the Ministry of Land, Transport and Maritime Affairs, in cases where a rental business operator constructs a rental house with funds from the National Housing Fund under Article 60 of the Housing Act or makes conversion for sale in lots on a housing site created by a public project from among the housing constructed by a rental business operator with approval for a project plan pursuant to Article 16 of the Housing Act after the expiration of the mandatory rental period (excluding each subparagraph omitted).”

The purpose of the Rental Housing Act is to ensure the tenant's preferential right to purchase a rental house in a stable manner by guaranteeing the tenant's preferential right to purchase a rental house, and the Rental Housing Act provides procedures for the tenant's application for approval for sale in lots and provides for the tenant's approval for sale in lots and does not separately provide for procedures to notify the tenant of such approval, so the tenant's approval for sale in lots may not be known, and Article 21 (7) of the Rental Housing Act provides that the tenant can sell the rental house to a third party for more