[1] Whether the validity of the registration of transfer of ownership that has been made without going through the procedure for settlement under Articles 3 and 4 of the Provisional Registration Security Act (negative) and whether the registration of transfer of ownership becomes effective as a transfer of security within the weak meaning (negative), and whether the transfer of ownership becomes effective registration in accordance with the substantive relations (affirmative)

[2] Whether a claim for indemnity, which a creditor of a provisional registration security has subrogated for a third party of a debtor of a provisional registration security obligation in order to preserve his/her right, is also included in the secured claim of a provisional registration (affirmative)

[3] Whether the amount of a provisional seizure registered earlier than the provisional registration for security is included in the amount of a claim of a creditor secured by provisional registration in accordance with the "amount of a claim secured by a prior security, etc." under the latter part of Article 4(1) of the Provisional Registration Security Act (affirmative)

[1] Articles 3 and 4 of the Provisional Registration Security Act / [2] Article 360 of the Civil Act, Articles 3 and 4 of the Provisional Registration Security Act / [3] Articles 3 and 4 of the Provisional Registration Security Act

[1] Supreme Court Decision 9Da41657 delivered on June 11, 2002 (Gong2002Ha, 1605), Supreme Court Decision 2002Da42001 Delivered on December 10, 2002 (Gong2003Sang, 342) / [2] Supreme Court Decision 76Da2169 delivered on October 26, 1976 (Gong1976, 939Da41657 delivered on June 11, 2002 (Gong200Ha, 1605)

Plaintiff (Law Firm Barun, Attorneys Kim Jung-soo et al., Counsel for the plaintiff-appellant)

Defendant (Attorney Cho Sung-ap et al., Counsel for the defendant-appellant)

Jeju District Court Decision 2005Na1810 Decided June 7, 2006

The appeal is dismissed. The costs of appeal are assessed against the plaintiff.

We examine the grounds of appeal.

1. In light of the provisions of Articles 3 and 4 of the Provisional Registration Security Act (hereinafter “Provisional Registration Security Act”), where the principal registration based on provisional registration has been made in violation of each of the above provisions, the principal registration shall be null and void. Even if the principal registration was made by a special agreement between the person holding the right to provisional registration and the debtor, if such special agreement is null and void because it is unfavorable to the debtor, the principal registration shall be still null and void, and it shall not be deemed null and void within the so-called weak meaning as collateral. However, if a person holding the right to provisional registration notifies the debtor, etc. of the appraised value of the provisional registration in accordance with the procedures provided for in Articles 3 and 4 of the Provisional Registration Security Act and there is no liquidation amount to pay or pay the liquidation value to the debtor, the above provisional registration shall be deemed null and void as valid registration in accordance with the substantive legal relations of the debtor after the date of receiving the notification (see Supreme Court Decision 9Da41657, Jun. 11, 2002; Supreme Court Decision 209Da16614, Feb. 4, 2007).

The court below held that the provisional registration of this case, which was made in the name of the defendant with respect to each of the land of this case, is a provisional registration under the Provisional Registration Security Act to secure the defendant's obligation to borrow a loan, and that the registration of ownership transfer of this case, which was made based on the provisional registration of this case, is null and void without going through liquidation procedures as prescribed in Articles 3 and 4 of the Provisional Registration Security Act. However, upon the defendant's completion of the registration of ownership transfer of this case, the court below held that the court below erred in the misapprehension of legal principles as to the provisional registration of this case and the transfer of ownership transfer of the non-party's real estate of this case, 149,852,476 won (the assessed value of each of the land of this case based on the market price appraisal by the appraiser of the first instance court, 532,791,860 won as to the provisional registration of this case, and 208,939,384 won as to the above senior collateral security obligation of this case, and the remaining amount of the non-party's claim.

2. The Defendant’s notification of the exercise of the security right on December 18, 2004 does not constitute a legitimate notification under the latter part of Article 3(2) of the Provisional Registration Security Act, or the assertion that the registration cost of KRW 9,570,340, which is not the secured claim of the provisional registration of this case, is stated as the amount of the secured claim, and thus null and void is the first asserted in the final appeal and cannot be a legitimate ground for appeal

3. In addition, although the sum of the value of the instant land 1, 2 exceeds KRW 507,104,330, the secured claim amount of the instant provisional registration exceeds KRW 382,939,384, the Defendant’s assertion that it is not legitimate to exercise the security right to the instant land 3 cannot be a legitimate ground for appeal due to the lack of argument before the closing of argument in the lower court.

4. Therefore, the appeal is dismissed, and the costs of appeal are assessed against the losing party. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Kim Yong-dam (Presiding Justice)