[1] Whether the right of priority repayment of small-sum security deposit is recognized in the private enforcement procedure under the Provisional Registration Security Act (affirmative)

[2] In a case where a house was knocked due to the execution of a subordinated mortgage, whether a lessee who has an opposing power between a senior mortgage and a junior mortgage can claim the effect of the right of lease against the successful bidder (negative)

[3] The case holding that, in case where a housing lessee acquired the opposing power after the senior mortgage was established, the above housing lease shall lose its opposing power along with the extinction of the mortgage in the private execution procedure under the Act on the Security of Provisional Registration, etc. that was in progress thereafter

[1] Under the Housing Lease Protection Act, since a housing lessee does not have the right to demand an auction, whether a provisional registration security right is enforced by auction is decided regardless of his/her will, and it is decided whether it is a private execution by auction, and there is no reasonable ground to view that it is not so if it is implemented by auction, and that it is the same as the acquisition of ownership by a person who has a provisional registration security right through private execution procedure is awarded a successful bid at auction. Therefore, in the case of a claim for return of a lease security deposit which meets the requirements under Article 8 of the Housing Lease Protection Act, the right to demand a preferential repayment can be paid first in the private execution. As such, the right to demand a preferential repayment of the housing lessee takes precedence over all the secured parties, so within this scope, the housing lessee may exercise the right to demand a preferential repayment regardless of the assessed amount of the liquidation amount notified or whether

[2] In the event of a successful bid of the immovable property which is the object of the execution of subordinated mortgage, the priority mortgage is naturally extinguished pursuant to the provisions of Articles 728 and 608(2) of the former Civil Procedure Act. In this case, even if the right of lease is possible to oppose the subordinated mortgagee, the right of lease registered after the priority mortgage which is extinguished or has opposing power is extinguished, and therefore, the successful bidder cannot be deemed to be included in the assignee of the leased house as stipulated in Article 3 of the Housing Lease Protection Act, and therefore, the right of lease cannot be asserted against the successful bidder.

[3] The case holding that in the case where a housing lessee acquired the opposing power after the senior mortgage was established, the above housing lease shall lose its opposing power along with the extinction of the mortgage in the private execution procedure under the Act on the Security of Provisional Registration, etc. that was proceeding thereafter.

[1] Article 8 of the Housing Lease Protection Act, Articles 3 and 4 of the Enforcement Decree of the Housing Lease Protection Act / [2] Article 3 of the Housing Lease Protection Act, Article 608 (2) of the former Civil Procedure Act (amended by Act No. 6626 of Jan. 26, 2002) (see current Article 91 (2) of the Civil Execution Act), and Article 728 (see current Article 268 of the Civil Execution Act) / [3] Article 3 of the Housing Lease Protection Act, Article 608 (2) of the former Civil Procedure Act (amended by Act No. 6626 of Jan. 26, 2002) (see current Article 91 (2) of the Civil Execution Act), Article 728 of the former Civil Procedure Act (see current Article 268 of the Civil Execution Act)

[2] Supreme Court Decision 98Da32939 delivered on April 23, 1999 (Gong199Sang, 993)

Plaintiff 1 and four others (Attorney Ansan-gu, Counsel for the plaintiff-appellant)

Defendant (Law Firm Cheongn Law, Attorneys Kim Jong-chul, Counsel for defendant-appellant)

Changwon District Court Decision 2005Kahap52, 281 Decided April 20, 2007

December 7, 2007

1. The judgment of the court of first instance is modified as follows.

A. All claims filed by the Plaintiff (Counterclaim Defendant) are dismissed.

B. The Defendant-Counterclaim Plaintiff:

(1) At the same time, the Plaintiff (Counterclaim Defendant) received KRW 12,00,000 from the Defendant (Counterclaim Plaintiff) and received KRW 12,00,00, the Plaintiff (Counterclaim Defendant) stated in attached Table 1’s building; the Plaintiff (Counterclaim Defendant)’s building listed in attached Table 2; the Plaintiff (Counterclaim Defendant)’s building listed in paragraph (3) of the same attached Table; and the Plaintiff (Counterclaim Defendant)’s (Counterclaim Defendant)’s name stated in paragraph (4) of the same attached Table; and

(2) Plaintiff (Counterclaim Defendant) 5 shall order the building indicated in Paragraph (5) of the same list.

C. Each of the remaining counterclaim claims against the Plaintiff (Counterclaim Defendant) 1, 2, 3, and 4 by the Defendant (Counterclaim Plaintiff) are dismissed.

2. Of the total litigation cost (including the principal lawsuit and the counterclaim), the part arising between the Plaintiff (Counterclaim Defendant) 1, 2, 3, and 4 and the Defendant (Counterclaim Plaintiff) shall be divided into three parts, and the remainder shall be borne by the Defendant (Counterclaim Plaintiff) and the Defendant (Counterclaim Defendant), respectively. The part arising between the Plaintiff (Counterclaim Defendant) 5 and the Defendant (Counterclaim Plaintiff) shall be borne by the Plaintiff (Counterclaim Defendant).

3. Paragraph 1-b. above may be provisionally executed.

The judgment of the first instance shall be revoked.

The principal lawsuit: The sales contract concluded on October 25, 2004 between the Defendant (Counterclaim Plaintiff; hereinafter “Defendant”) and the Dong Dong Dong Dong Dong Construction Co., Ltd. on each real estate listed in the separate sheet No. 2 shall be revoked. The Defendant will implement the procedures for the cancellation of ownership transfer registration completed on October 25, 2004 by the registration office for the Plaintiff (Counterclaim Defendant; hereinafter “Plaintiff”) instead of the original original district court for each real estate.

Counterclaim: The Defendant, Plaintiff 1, Plaintiff 2, Plaintiff 2, Plaintiff 3, Plaintiff 4, Plaintiff 4, and Plaintiff 5 respectively named in Section 5 of the same Schedule.

1. cite the reasoning of the first instance judgment;

The reasoning of the court's explanation concerning this case is as follows: (a) the part of the first instance judgment No. 4, No. 6 through No. 8 is used as follows; (b) the part of the fifth part is corrected as " October 25, 2005" in No. 14 as " October 25, 2004"; and (c) the part of the 6th part to No. 8, No. 7, and No. 19 in the second part is identical to that of the first instance judgment except that of "the judgment on the counterclaim claim," and the part is used as "the judgment on the counterclaim claim," and thus, it is cited in accordance with Article 420 of the Civil Procedure Act.

[Supplementary Use]

F. The non-party company: (a) was released from the Changwon District Court on January 19, 2004 on each of the real estate listed in the separate list No. 1 owned by it; (b) registered the provisional registration on each of the real estate in the separate list No. 1 owned by it under the name of the defendant; (c) registered the right to claim ownership transfer on the same day as of January 19, 2004; and (d) registered the cancellation on August 25, 2004 on each of the buildings listed in paragraph (5) of the same list as of August 25, 2004; (d) registered the cancellation of the provisional registration on each of the real estate listed in the separate list No. 1 and 2, and registered the ownership transfer on the same day under the name of the defendant with respect to the 38 households of Changwon apartment loans, including the real estate listed in the separate list No. 1 and 2,

[Supplementary Use]

3. Judgment on the counterclaim

A. Determination on the grounds for the counterclaim

(1) In full view of the purport of the entire pleadings, the following facts are recognized in each of the statements in Section B(1) through Section B(4), 5, 8, 20 to 22(including each number):

(A) Nonparty 1, the Defendant’s children, at the request of the Nonparty company (the representative director Nonparty 2) that newly built the above Do-dong apartment, lent the construction fund to the Nonparty company on February 18, 2003, KRW 100 million on March 24, 2003, KRW 300 million on April 24, 200 of the same year, KRW 70 million on May 27, 200 of the same year, KRW 10 million on August 16, 16 of the same year, KRW 770 million on each interest rate of KRW 3% on August 16, 200, and issued the sales contract in the name of Nonparty 1 on August 16, 2003.

(B) On January 19, 2004, Nonparty 1 extended additional KRW 163.9 million to the non-party company, and received the registration of the right to claim ownership transfer on the ground of the pre-sale promise with respect to the 38 generation of Dong Do Do Do Do Do Do Do dong apartment (hereinafter “the instant 38 generation”), including each real estate listed in the attached Tables 1 and 2 as security for the total amount of KRW 933.9 million until then.

(C) Meanwhile, on October 21, 2004, Nonparty 1, who represented by the defendant, completed the registration of ownership transfer for the 38 household units of this case between the non-party company and the non-party company by October 22, 2004, but where the non-party company pays the above loan obligations by February 28, 2005, he agreed to return it, and received the registration of ownership transfer for the 38 household units of this case on October 25, 2004 under the name of the defendant.

(D) On September 2007, the Defendant received the permission for service by public notice from the Changwon District Court Decision 2007Kaman969, and notified the non-party company, etc. of the execution of the security right as to each real estate listed in the separate list No. 1 on the 21st of the same month in accordance with the procedure stipulated in the Provisional Registration Security Act, and notified the non-party company, etc. of the execution of the security right. The Defendant assessed the value of the secured real estate as KRW 30 million (60 million x 5), and notified the non-party company, etc. of the purport that the remaining value does not exist if the sum of the maximum debt amount of the agricultural cooperative, who was the prior

(2) According to the above facts, since there is no liquidation money to be paid by the defendant, the defendant acquired the ownership of each real estate listed in the separate sheet No. 1 on November 21, 2007, which is clear from September 21, 2007 when two months have passed since the notice of the exercise of the security right was delivered. Meanwhile, as seen earlier, the plaintiffs occupied each real estate listed in the same list, and thus, barring any special circumstance, the plaintiffs are obligated to order the defendant to issue each of the above real estate.

B. Judgment on the plaintiffs' defense

(1) Summary of the defense

Plaintiff 1, 2, 3, and 4 are small tenants under Article 8 of the Housing Lease Protection Act, who are entitled to receive at least KRW 12,00,000 among their claims for return of deposit for lease. Thus, the Defendant cannot respond to the Defendant’s request for surrender until they are paid the above amount. In addition, Plaintiff 5 is unable to respond to the Defendant’s request for surrender, since the provisional registration for claim for transfer of ownership was made on January 19, 204 under the name of the Defendant as to the building listed in paragraph (5) of the attached Table 1, and the Plaintiff 5 satisfies the requirements for counterclaim as prescribed by the Housing Lease Protection Act after receiving the payment of KRW 35,00,000 from the Defendant who succeeded to the status of Nonparty

(2) Determination:

(A) On the other hand, in the Housing Lease Protection Act, a housing lessee is not entitled to a right of auction because he/she is not entitled to a right of auction. Whether a provisional registration security right is implemented by auction is determined regardless of his/her will, and it is determined by auction, and there is no reasonable ground to deem that it would not be the preferential repayment when it is implemented by auction, and that the provisional registration security right holder acquires ownership through private enforcement procedures is the same as the successful bid in the auction procedure. Therefore, in the case of a right to return a lease security deposit that meets the requirements under Article 8 of the Housing Lease Protection Act, it

As such, the right to preferential repayment of a housing lessee takes precedence over a junior right holder's claim, and thus, the housing lessee may exercise the right to preferential repayment regardless of the appraised value of the liquidation notified or the existence of the liquidation amount, and the right to preferential reimbursement can be asserted as the right of lease until the repayment is made.

Therefore, the defenses of plaintiffs 1, 2, 3, and 4, which are defined in Article 8 of the Housing Lease Protection Act and Article 3 and Article 4 of the Enforcement Decree of the same Act (if the amount of lease guarantee is not more than 30 million won, 12 million won out of them) are reasonable.

(B) Meanwhile, the provisional registration of the right to claim ownership transfer on January 19, 2004 under the name of the defendant as to the building listed in the attached Table 1 List No. 5 was lawfully cancelled on August 25, 2004, and the plaintiff 5 met the requisite for setting up against the Housing Lease Protection Act (the moving-in and moving-in report) prior to the time of the defendant's transfer of ownership or acquisition of ownership. However, according to the evidence No. 6-1 of the attached Table No. 6-1, it can be acknowledged that the establishment registration of a neighboring mortgage with the maximum debt amount of the above building amount of KRW 680 million has been completed in the Agricultural Cooperative, not later than December 29, 2003.

In the event of a successful bid of the immovable property subject to the enforcement of subordinated mortgage, the priority mortgage is naturally extinguished pursuant to the provisions of Articles 728 and 608 (2) of the former Civil Procedure Act. In this case, even if the right of lease that can be asserted against the subordinated mortgagee is extinguished, the right of lease registered after the senior mortgage is extinguished or with opposing power cannot be considered to be included in the transferee of the leased house under Article 3 of the Housing Lease Protection Act. Therefore, the successful bidder cannot claim the effect of the right of lease against the successful bidder (see Supreme Court Decision 98Da32939 delivered on April 23, 199). As seen above, the defendant appropriated the value of the above building in private enforcement procedures under the Act on Provisional Registration Security, etc., for repayment of the agricultural cooperative's credit, and the right of lease against the above defendant cannot be asserted since the plaintiff 5, who has opposing power also expired together with this.

Therefore, the above plaintiff's defense is without merit.

C. Sub-committee

Therefore, at the same time with the Defendant’s payment of KRW 12,00,000 from the Defendant, the Plaintiff 1 is obligated to order each of the buildings listed in paragraph (1) of the attached Table 1, Plaintiff 2 is the building listed in paragraph (2) of the same Table, Plaintiff 3 is the building listed in paragraph (3) of the same Table, Plaintiff 4 is the duty to order each of the buildings listed in paragraph (4) of the same Table, and Plaintiff 5 is the duty to order each of the buildings listed in paragraph (5) of the same Table.

2. Conclusion

Therefore, all of the plaintiffs' claims against plaintiffs 1, 2, 3, and 4 are dismissed as they are without merit. The defendant's claims against plaintiffs 1, 2, 3, and 4 are accepted within the scope of the above recognition, and all of the counter claims against plaintiffs 5 are justified, and the remainder of the counter claims against plaintiffs 5 are dismissed as they are without merit. The part of the judgment of the court of first instance concerning the principal lawsuit is just as it is concluded, but the part concerning the counter claim is unfair as it is concluded differently, and the judgment of the court of first instance is modified as above.

[Attachment] List of Real Estate: omitted

Judges Kim Shin (Presiding Judge)