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Civil Act of South Korea/REAL RIGHTS

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349005Civil Act of South Korea — PART II Real Rights

CHAPTER Ⅰ GENERAL PROVISIONS

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Article 185 (Kinds of Real Rights)
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No real right can be created at will other than ones provided for by law or customary law.

Article 186 (Effect of Changes in Real Rights over Immovables)
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The acquisition, loss of, or any alteration in, a real right by a juristic act over an immovable takes effect upon its registration.

Article 187 (Acquisition of Real Rights over Immovables not Requiring Registration)
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The acquisition of real rights over immovables through inheritance, expropriation, judgment, auction and others stipulated in provisions of law shall not require registration: Provided, That the immovable shall not be disposed of unless it has been registered.

Article 188 (Effect of Changes in Real Rights over Movables, Summary Assignment)
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(1) The assignment of real rights over movables takes effect by delivery of the Article.

(2) When an assignee possesses a movable, the assignment takes effect by a mere declaration of such intention by the parties.

Article 189 (Agreement on Possession)
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If real rights in movables are to be assigned and the assigner is to continue possessing the Articles in accordance with a contract concluded by the parties, it shall be regarded that the Articles have been delivered to the assignee.

Article 190 (Assignment of Claim for Return of Object)
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In a case where real rights to a movable possessed by a third party are assigned, if the assigner assigns to the assignee the claim for return of the movable possessed by the third party, it shall be regarded that the movable has been delivered.

Article 191 (Lapse of Real Rights due to Merger)
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(1) When the ownership and other real rights over one and the same thing have become rested in one and the same person, such real rights shall lapse: Provided, That this shall not apply if the real rights form the object of a right of a third party.

(2) The provisions of the preceding paragraph shall apply mutatis mutandis to the case where a real right other than ownership and other rights having such right for its object, has become rested in one and the same person.

(3) The provisions of the preceding two paragraphs shall not apply to possessory rights.

CHAPTER Ⅱ POSSESSORY RIGHT

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Article 192 (Acquisition and Extinction of Possessory Right)
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(1) Anyone who has de facto control over an Article shall have possessory right to that Article.

(2) Possessory right is lost if the possessor loses de facto control over the Article: Provided, That this shall not apply if possession is recovered in accordance with the provisions of Article 204.

Article 193 (Transfer of Possessory Right through Succession)
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Possessory right shall be transferred to the successor in case of succession.

Article 194 (Indirect Possession)
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Anyone who causes another person to possess an Article through superficies, chonsegwon (right of registered lease on deposit basis), pledge, loan for use, lease, bailment or other relations, shall indirectly have a possessory right over the subject Article.

Article 195 (Possession Assistant)
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If a person exercises de facto control over an Article based on instructions received from another person, through relationship of household affairs, business and other similar relations, only the latter person shall be the possessor.

Article 196 (Assignment of Possessory Right) (1) The assignment of possessory right shall become effective by the delivery of the Article in possession. (2) The provisions of Articles 188 (2), 189, and 190 shall apply mutatis mutandis to the assignment of possessory right under the preceding paragraph. Article 197 (State of Possession) (1) A possessor is presumed to be in possession openly, peaceably, in good faith, and with the intention of holding as owner. (2) Even if a possessor is in good faith, when he fails in an action on title, he is deemed to have been a possessor in bad faith, from the time of the commencement of the action. Article 198 (Presumption of Continuation of Possession) If there is proof of possession at two different times, possession is presumed to have been continuous throughout the intermediate time. Article 199 (Assertion of Succession of Possession and Effect thereof) (1) The successor in the chain of title of a possessor may at his option assert either only his own possession or it together with that of his predecessor. (2) In a case where the possession of a predecessor is asserted together with that of the successor in the chain of title, the latter shall also succeed to any defects in the title which the former had. Article 200 (Presumption of Lawful Exercise of Right) A possessor shall be presumed to lawfully hold the right which he exercises over the Article in possession. Article 201 (Possessor and Fruits) (1) A possessor in good faith acquires the fruits of the Article in possession. (2) A possessor in bad faith is liable to return the fruits, and to make compensation for the value of fruits which have already been consumed by him, have been damaged, or have not been collected through his negligence. (3) The provisions of the preceding paragraph shall apply mutatis mutandis to possessors by force or in secret. Article 202 (Possessor’s Liability to Person Entitled to Restoration) If an Article possessed has been lost or damaged by any cause for which the possessor is responsible, a possessor in bad faith shall be liable for the entire damage, and a possessor in good faith shall be liable to the extent of the enrichment he still enjoys. A possessor who has no intention of holding as owner must repair the entire damage even though he may be acting in good faith. Article 203 (Claim of Possessor for Reimbursement) (1) When a possessor restores the article in possession, he is entitled to be reimbursed by the person demanding restoration, for the cost of its preservation and other necessary expenses: Provided, That in the case where the possessor has acquired the fruits, ordinary necessary expenses shall be borne by himself. (2) In regard to the cost of improvement and other necessary expenses paid on the article in possession, the possessor is, to the extent that the increase in value remains, entitled to reimbursement either of the amount expended or of the amount by which the value of the article has been increased, at the option of the person claiming its recovery. (3) In the case of the preceding paragraph, the court may, upon the application of the person claiming recovery, allow a reasonable time for reimbursement. Article 204 (Recovery of Possession) (1) If a possessor has been deprived of the possession of his property, he may demand the return of that which he was deprived as well as compensation for damages. (2) No demand under the preceding paragraph may be brought against a limited successor in title of a dispossessor, unless such successor in title was aware of dispossession. (3) The right of demand under paragraph (1) shall be exercised within one year from the time of dispossession. Article 205 (Maintenance of Possession) (1) If a possessor is disturbed in his possession, he may demand cessation of the disturbance as well as compensation for damages. (2) The right of demand under the preceding paragraph shall be exercised within one year from the time the disturbance cease to exist. (3) If the Article possessed has been damaged due to construction works, the removal of the disturbance shall not be demanded after one year has elapsed since the beginning of such works, or after the works were completed. Article 206 (Preservation of Possession) (1) If the possessor feels that his possession may be disturbed, he may either demand the prevention of such disturbance or demand security for damages. (2) If the possessor feels that his possession may be disturbed by any construction works, the provisions of paragraph (3) of the preceding Article shall apply mutatis mutandis. Article 207 (Protection of Indirect Possession) (1) The right of demand under the preceding three Articles may also be exercised by indirect possessors under the provisions of Article 194. (2) If a possessor is deprived of his possession, the indirect possessor may demand the return of the article in question to the possessor, and in a case where the possessor cannot receive the return of the article in question or he does not want it, the indirect possessor may demand that the article be returned to him. Article 208 (Relations between Possessory Actions and Actions on Title) (1) Possessory actions and actions on title shall not exclude each other. (2) Possessory actions may not be decided upon grounds related to actions on title. Article 209 (Self-help) (1) A possessor may defend, with his own force, his possession against those acts unjustly depriving him of his rightful possession or disturbing it. (2) If the possessor of an immovable has been deprived of possession thereof, the possessor may recapture it by evicting the assailant immediately after the deprivation; and if it is a movable, the possessor may recapture from the assailant, on the spot or in pursuit, the article in question. Article 210 (Quasi-Possession) The provisions of this Chapter shall apply mutatis mutandis to cases where a person exercises a property right de facto.

CHAPTER Ⅲ OWNERSHIP

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SECTION 1 Limitation of Ownership

Article 211 (Contents of Ownership) An owner has the right, within the scope of law, to use, take the profits of, and dispose of, the article owned. Article 212 (Scope of Ownership of Land) Within the scope, where a justifiable profit exists, the ownership of land extends both above and below its surface. Article 213 (Claim for Return of Article Owned) An owner may demand the return of an article from the person in possession of that article: Provided, That in a case where the possessor has the right to possess the article, he may refuse to return it. Article 214 (Claim for Removal and Prevention of Disturbance against Article Owned) An owner may demand the cessation of disturbance from a person who disturbs ownership, and may demand either prevention of the disturbance or security for damages from the person who might disturb ownership. Article 215 (Partitioned Ownership of Building) (1) If a building is divided between two or more persons and each owns a part thereof, those portions of the building and their appurtenances that are used in common are presumed to be under their co-ownership. (2) The expenses for the preservation and other charges relating to the portions used in common shall be divided in proportion to the value of the part owned by each. Article 216 (Claim of Use of Adjoining Land) (1) The owner of land may, to the extent that it is necessary for the construction or repairs of walls or buildings in or near the boundary, demand use of the adjoining land: Provided, That he may not enter the dwelling house of the neighbor without his consent. (2) In the case mentioned in the preceding paragraph, if the neighbor sustains any damages he may claim compensation for it. Article 217 (Prohibition of Disturbance against Adjoining Land by Soot, etc.) (1) The owner of land has a duty to take appropriate measures so that soot, heat gas, liquid, sound, vibration, and the like may not harm or disturb the neighbor’s living or use of the adjoining land. (2) If the situation under the preceding paragraph is appropriate for the ordinary use of the adjoining land, the neighbor has the duty of enduring such a situation. Article 218 (Right of Installing Water Service Pipes, etc.) (1) If the installation of necessary water pipes, drainpipes, gas pipes, electric wires, etc. would be impossible or the cost thereof is excessive, unless they passed over another person’s land, the owner may pass over the such land and install them: Provided, That the place and method of such passage must be so chosen as to cause the least possible damage to the another person’s land, and the other person shall, upon request, be compensated for the damage sustained thereby. (2) Where circumstances develop which require further alteration in the installation under the preceding paragraph, the other person may request to make changes in the installation. The expenses of such changes in the installation shall be borne by the owner of the land. Article 219 (Right of Passing over Surrounding Land) (1) If a piece of land has no access to a public road, which is necessary for the use of the land, without passing over the surrounding land, and the owner of the land cannot reach the public road, or the cost to reach the public road would be excessive, he may pass over the surrounding land to the public road, and if necessary he may construct a path. But, the method and place must be so chosen as to cause the least possible damage to the surrounding land. (2) The person having the right of passage under the preceding paragraph shall compensate the owner of the land for any damage done to the land passed over. Article 220 (Partition, Partial Assignment and Right of Passing over Surrounding Land) (1) If through the process of partition, a piece of land has lost access to a public road, the owner of such land may, in order to reach a public road, pass over the land partitioned. In such case no compensation is obliged. (2) The provisions of the preceding paragraph shall apply mutatis mutandis to cases where the owner of land assigns part of his land. Article 221 (Natural Flow of Water) (1) The owner of land may not interfere with the natural flow of water coming from adjoining land. (2) The owner of higher land may not interfere with the natural flow of water necessary for and flowing down onto the adjoining lower land by diverting more water than is necessary for his reasonable use. Article 222 (Right of Drainage Works) When the water course has been obstructed on lower land, the owner of the higher land may at his own expense construct works necessary for its drainage. Article 223 (Right to Claim Repair, etc. of Structures for Reservoiring Draining or Drawing Water) When the owner of land constructs structures for the purpose of reservoiring, draining or drawing water, and if, by the disruption or obstruction of the works, damage has been done, or there is a possibility of damage to the other’s land, the other person may request the owner of the land to effect repair, to drain off the water, or to take preventive measures. Article 224 (Custom on Expense) If in the cases mentioned in the preceding two Articles, any custom exists as to who shall bear the expense, such custom shall prevail. Article 225 (Duty to Install Structures against Rain Water) The owner of land shall construct proper structures so that rain water may not fall from the eaves directly on adjoining land. Article 226 (Right of Discharging Surplus Water) (1) For the purpose of draining land which is under water, or of discharging surplus water for household, agricultural or industrial uses, the owner of a higher land may divert the water to the lower land until it reaches a public road, public water way or drain. (2) In the case of the preceding paragraph, the place and the method must be so chosen as to cause the least possible damage to the lower land, and compensation for any damage shall be paid. Article 227 (Right to Use Structures for Flow of Water in Adjoining Land) (1) The owner of land may, for the purpose of discharging water from his land, use any structures constructed by the owner of the adjoining land. (2) The person using the structures under the preceding paragraph must bear the expenses of the construction and preservation of such structures in proportion to the benefit he derives therefrom. Article 228 (Claim for Surplus Water) If an owner of land finds it difficult to obtain the necessary water for his household or for utilization of his land without incurring excessive costs in material or labor, he may request the owner of the adjoining land to furnish surplus water, after paying compensation. Article 229 (Alteration in Watercourse) (1) The owner of a ditch or other watercourse may not alter its course or width, if the land on the opposite bank belongs to another person. (2) If the land on both banks belongs to the owner of a water course, such owner may alter its course and width: Provided, That the water shall be restored to its natural course at the lower exit. (3) If there exists any custom different from that provided for in the preceding two paragraphs, such custom shall prevail. Article 230 (Right of Constructing and Using Dam) (1) If there is any need for the construction of a dam, the owner of a water course may attach it to the opposite bank: Provided, That he must pay compensation for any damage caused thereby. (2) If a part of a water course belongs to the owner of the opposite bank, he may use the dam; but he must bear the expenses of the construction and preservation of the dam in proportion to the benefit he derives therefrom. Article 231 (Right of Using Public River) (1) Those engaged in agriculture and industry on the banks of public rivers may draw necessary water from the river for use in their business as long as they do not disturb the use of water by other persons rightfully entitled to such use. (2) Structures necessary for drawing water under the preceding paragraph may be constructed. Article 232 (Protection of Right of Using Water at Lower Part) In a case where the right to use water at a lower part has been disturbed by drawing water or structures under the preceding Article, the person having the right to use the water may demand removal of the disturbance as well as compensation for damages sustained thereby. Article 233 (Succession of Right to Use Water) The limited successor of the owner of a watercourse, or other structures utilized for the operation of agriculture and industry, or the limited successor of the person profiting from the watercourse or the structures, shall succeed to the rights and duties of the former owner or the person profiting. Article 234 (Other Customs on Right to Use Water) If there exists any custom different from those provided for in the preceding three Articles, such custom shall prevail. Article 235 (Right to Use Water for Common Use) Adjoining neighbors have the right to use the wellspring or water supply for common use in proportion to their demands as long as they do not disturb the other’s use of water. Article 236 (Construction Work and Compensation for Damage due to Obstruction in Use of Water, Restoration) (1) If a wellspring or water supply having necessary use or making necessary profits has been suspended, decreased in water amount, or is obstructed in the use due to building or other construction works by other persons, the person having the right to use the water may demand compensation for the damage sustained as a result thereof. (2) If the construction work, as described in the preceding paragraph, causes any obstruction in the use of water for drinking or living the sufferer may demand restoration of its original state. Article 237 (Right of Constructing Boundary Mark or Fence) (1) The owners of adjoining land may construct a boundary mark or a fence at their joint expense. (2) The expense under the preceding paragraph shall be borne by both persons in equal proportions: Provided, That the expenses of a survey shall be apportioned in proportion to the area of the land. (3) If there exists any custom different from those provided for in the preceding two paragraphs, such custom shall prevail. Article 238 (Right of Specially Constructed Fence) Any of the adjoining neighbors may, at their own expense, construct a better fence using better materials, make it higher than ordinary fences, or may construct a fireproof wall, or other special facilities. Article 239 (Presumption of Joint Ownership of Boundary Marks, etc.) Boundary marks, fences, ditches, etc. set on the boundary line are presumed to be co-owned by adjoining neighbors. But this shall not apply if the boundary marks, fences, ditches, etc. are constructed at the expense of only one of the adjoining neighbors, or the fence forms part of a building. Article 240 (Right of Removing Branches and Roots of Trees) (1) If the branches of trees on adjoining land extend over the boundary line, the owner of such trees may be required to remove the branches. (2) If the owner does not comply with the request under the preceding paragraph, the claimant may remove them. (3) If the roots of trees on adjoining land extend across the boundary line, they may be cut away at will. Article 241 (Prohibition of Digging too Deep on Land) The land owner shall not dig so deep on his own land so that the ground of the adjoining land might be imperiled unless sufficient protective construction work is done. Article 242 (Construction near Boundary Line) (1) If there is no special custom on constructing buildings, a distance of not less than 0.5 meters must be left between the building and the boundary line. (2) The owner of the adjoining land may request that the person who has violated the provisions of the preceding paragraph remove or modify the building. But if one year has elapsed since the commencement of the construction work, or if the construction has been completed, only damages can be claimed. Article 243 (Obligation of Establishing Screen) If a person constructs, at a distance of not more than two meters from the boundary line, a window or verandah which overlooks the inside of another person’s house, he shall erect a proper screen. Article 244 (Limit to Underground Facilities, etc.) (1) In digging a well or other underground facilities to store water, sewage or filth, etc., a distance of not less than two meters must be left from the boundary line. In digging a pond, ditch, or cellar, a distance of not less than one half of their depth must be left from the boundary line. (2) In the construction work mentioned in the preceding paragraph, appropriate measures must be taken to prevent the collapse of earth and sand, or the infiltration of sewage or polluted liquids into adjoining land.

SECTION 2 Acquisition of Ownership

Article 245 (Period for Acquiring Ownership of Immovables by Possession) (1) A person who has for twenty years peaceably and openly held possession of an immovable with an intention to own it, shall acquire the ownership by making registration thereof. (2) A person, who has made registration as the owner of an immovable and has for ten years peaceably and openly held possession of an immovable with the intent to own it, shall acquire the ownership of such immovable if his possession is in good faith and without negligence. Article 246 (Period for Acquiring Ownership of Movables by Possession) (1) A person who has for ten years peaceably and openly held possession of a movable with the intent to own it, shall acquire the ownership of such a movable. (2) In a case where the possession under the preceding paragraph was commenced in good faith and without negligence, ownership shall be acquired after five years have elapsed. Article 247 (Retroactive Effect of Acquisition of Ownership, Grounds of Interruption) (1) The effect of acquisition of ownership under the preceding two Articles is retroactive to the commencement of possession. (2) The provisions on the interruption of extinctive prescription shall apply mutatis mutandis to the period for acquiring ownership under the preceding two Articles. Article 248 (Acquisitive Prescription of Property Rights other than Ownership) The provisions of the preceding three Articles shall apply mutatis mutandis to the acquisition of property rights other than ownership. Article 249 (bona fide Acquisition) If a person who peaceably and openly was assigned a movable, had possession of it in good faith and without negligence, he shall acquire its ownership immediately even if the assigner is not a legal owner. Article 250 (Special Provision on Stolen or Lost Articles) If the movable mentioned in the preceding Article is a stolen or lost article, the injured party or loser may demand the return of the article within two years from the time when the article was stolen or lost: Provided, That this shall not apply in a case where the lost or stolen article is money. Article 251 (Special Provision on Stolen or Lost Articles) If the assignee has bought the stolen or lost Article in good faith at a sale by auction, in a public market, or from a merchant selling articles of the same kind, the injured party or loser may demand the recovery of the article after he reimburses the assignee for the price paid for it. Article 252 (Vesting of Articles without Owners) (1) A person who possesses, with the intention of owning, a movable without an owner, obtains its ownership. (2) Immovables without owners shall be vested in the National Treasury. (3) Wild animals shall be considered as without an owner. Wild animals which were kept in homes shall also be considered to be without on owner if they are returned to a natural state. Article 253 (Acquisition of Ownership of Lost Articles) The ownership of a lost article is acquired by the finder if its owner does not claim his right within one year after public notice has been given in accordance with the provisions of the Act. Article 254 (Acquisition of Ownership of Treasure-Trove) The ownership of a treasure-trove is acquired by the discoverer if its owner does not claim his right within one year after public notice has been given in accordance with provisions of the Act. But the ownership of a treasure-trove discovered on the property or among other things belonging to another person is acquired by the discoverer and the owner of the land or the thing in equal shares. Article 255 (State Ownership of Cultural Heritage) (1) Things which are important for scientific, artistic, or antiquarian research shall belong to the state, not following the provisions of Article 252 (1) and the preceding two Articles. (2) In the case of the preceding paragraph, the finder, the discoverer, and the owner of the land or things where the treasure-trove was discovered, may submit a request for proper compensation from the state. Article 256 (Attachment to Immovable) The owner of an immovable acquires the ownership of anything affixed thereto: Provided, That this shall not affect the rights of another person who has affixed such item and retained the title thereto. Article 257 (Attachment between Movables) If two or more movables belonging to different owners are so united together that they can no longer be separated without severe damage, or cannot be separated without excessive expense, the ownership of the composite thing belongs to the owner of the principal movable. If no distinction of principal and accessory can be made, the owners of such movables shall own the composite thing jointly in proportion to the value of the movables at the time they were united together. Article 258 (Mixture) The provision of the preceding Article shall apply mutatis mutandis if the movables belonging to different owners, are so integrated as to be no longer distinguishable from each other. Article 259 (Specification) (1) When a person has performed work upon a movable belonging to another person, the ownership of the article created by the work shall belong to the owner of the raw material: Provided, That if the value arising out of such workmanship considerably exceeds that of the material, the person who has performed the work shall acquire the ownership of the entire article created. (2) If a person who has performed work, has furnished a part of the material, the price of the part shall add to the value of work under the preceding paragraph. Article 260 (Effect of Annexing) (1) If the ownership of a movable is lost, in accordance with the provisions of the preceding four Articles, all other rights which exist over the movable shall also be lost. (2) If the owner of the article, mentioned above, has become the sole owner of the composite item, the integration, or the item created by the work, then the other rights mentioned in the preceding paragraph shall still exist from thence over such item; and if he has become a co-owner thereof, the other rights shall exist over his share therein. Article 261 (Right of Reimbursement due to Annexing) A person who has sustained a loss by reason of the provisions of the preceding five Articles may request compensation based on the grounds of unjust enrichment.

SECTION 3 Joint Ownership

Article 262 (Co-ownership of Article) (1) If an article is owned jointly by two or more persons in proportion to their own shares, the article shall belong to co-ownership. (2) The shares of the co-owners are presumed to be equal. Article 263 (Disposition of Share, Use of and Profit from Article Jointly Owned) The co-owners are entitled to dispose of their own shares and may make use of or take the profits from, in proportion to their own shares, the whole of the article owned jointly. Article 264 (Disposition of, Alteration in Articles Jointly Owned) No co-owner may dispose of or make any alteration in the article jointly owned without consent of the other co-owners. Article 265 (Administration and Preservation of Article Jointly Owned) All matters relating to the administration of the article jointly owned shall be determined by a majority in shares of the co-owners: Provided, That each co-owner is entitled to do any act of preservation. Article 266 (Liability for Article Jointly Owned) (1) Each co-owner shall pay the expenses of administration and bear all other charges relating to the articles jointly owned in proportion to his share. (2) If a co-owner fails to meet the obligation mentioned in the preceding paragraph for a period of one year or more, the other co-owners may acquire his share upon payment of a reasonable compensation. Article 267 (Reversion in case of Renunciation of Shares, etc.) If a co-owner renounces his share or dies without a successor, his share reverts to the other co-owners in proportion to their shares. Article 268 (Demand for Partition of Article Jointly Owned) (1) Each co-owner may demand a partition of the article jointly owned, but the co-owners may agree not to partition the article for a period not exceeding five years. (2) Such agreement as mentioned in the preceding paragraph may be renewed, but its duration cannot exceed five years from the time of renewal. (3) The provisions of the preceding two paragraphs shall not apply to Articles jointly owned under Articles 215 through 239. Article 269 (Methods of Partition) (1) If, with regard to the methods of partition, no agreement can be reached among the co-owners, any co-owner may file an application for partition with a court. (2) If partition of the property itself cannot be effected, or if there is an apprehension that the property may considerably depreciate in value as a result of partition, the court may order a sale thereof by official auction. Article 270 (Liability for Warranty due to Partition) Each co-owner shall, in proportion to his share, bear the same liability for warranty as that of a seller in regard to the parts which the other co-owners have acquired by partition. Article 271 (Partnership-ownership of Property) (1) In accordance with the provisions of Acts or contracts, if property is owned by several persons through a partnership relationship, the property shall belong to partnership-ownership. The rights of persons having partnership-ownership shall reach the whole of the property in partnership- ownership. (2) With regard to partnership-ownership, the following three Articles shall apply in addition to the provisions of the preceding paragraph or contracts. Article 272 (Disposition, Alteration and Preservation of Property in Partnership-ownership) None of the persons having partnership-ownership of a piece of property may dispose of or make alterations to the property without the consent of the other persons having partnership-ownership: Provided, That each person is entitled to do any act of preservation. Article 273 (Disposition of Share of and Prohibition of Partition of Property in Partnership-ownership) (1) The persons having partnership-ownership of a piece of property shall not dispose of the shares of the property without the consent of all persons. (2) The persons having partnership-ownership of a piece of property shall not demand partition of the property. Article 274 (Termination of Partnership-ownership) (1) Partnership-ownership of property shall terminate by dissolution of the partnership or assignment of the property. (2) With regard to partition of property in partnership-ownership under the preceding paragraph, the provisions concerning the partition of property jointly owned shall apply mutatis mutandis. Article 275 (Collective Ownership of Property) (1) If a piece of property is owned collectively by the members of an association which is not a juristic person, it shall belong to collective ownership. (2) With regard to collective ownership, the following two Articles shall apply subject to Articles of an association or other covenants. Article 276 (Administration, Disposition and Use of and Profit from Property in Collective Ownership) (1) The administration and disposition of property in collective ownership shall be determined by resolutions from a general meeting of the members. (2) Each member is entitled to make use of the property in collective ownership and to take the profits from it in accordance with the Articles of an association or other covenants. Article 277 (Acquisition and Loss of Rights and Duties concerning Property in Collective Ownership) The rights and duties of members concerning property in collective ownership shall be acquired or lost by acquiring or losing the membership therein. Article 278 (Quasi-joint Ownership) The provisions of this Section shall apply mutatis mutandis to property rights other than ownership, except as otherwise provided for by other Acts.

CHAPTER Ⅳ SUPERFICIES

Article 279 (Contents of Superficies) A superficiary is entitled to use the land of another person for the purpose of owning buildings, other structures or trees thereon. Article 280 (Superficies Having Agreed Duration) (1) If the duration of a superficies is to be determined by a contract, the period shall not be less than:

1.30 years if the superficies is for owning buildings made of stone, lime, brick, or strong buildings similar to the above, or for owning trees;
2.15 years in a case where the superficies is for owning buildings other than those mentioned in the preceding subparagraph; and
3.5 years in a case where the superficies is for owning structures other than buildings.

(2) If any period less than that mentioned in the preceding paragraph has been determined, it shall be extended to that period mentioned in the preceding paragraph. Article 281 (Superficies Having No Agreed Duration) (1) If the duration of superficies has not been determined by a contract, the period shall be the shortest period mentioned in the preceding Article. (2) If, when the superficies was created, the kind and construction of the structure were not determined, the superficies shall be regarded as the type of building mentioned in subparagraph 2 of the preceding Article. Article 282 (Assignment and Lease of Superficies) A superficiary may assign his right to another person or may lease the land within the duration of the superficies. Article 283 (Right to Demand Renewal and Purchase by Superficiary) (1) If buildings, other structures, or trees remain, on termination of the superficies, the superficiary may demand renewal of the contract. (2) If the settlor of the superficies does not want to renew the contract, the superficiary may ask the settlor of the superficies to purchase the structures or trees under the preceding paragraph at a reasonable price. Article 284 (Renewal and Duration) In the case where parties are to renew the contract, the duration of the superficies shall not be less than the shortest period mentioned in Article 280, commencing from the date of the renewal: Provided, That the parties can determine the duration of renewal longer than that of the Article 280. Article 285 (Duties of Removal, Right to Demand Purchase) (1) At the termination of a superficies, the superficiary shall restore the land to its original condition, removing the buildings, other structures, or trees. (2) In the case of the preceding paragraph, if the settlor of the superficies makes a request to purchase the structures or trees, tendering a reasonable price therefor, the superficiary may not refuse such request without justifiable reason. Article 286 (Claim for Increase or Decrease in Rent) In a case where the rent is not reasonable, due to changes in the price of the land or an increase or decrease in taxes or burdens upon the land, the parties concerned may request an increase or decrease in the rent. Article 287 (Claim for Termination of Superficies) If a superficiary has not paid rent for a period of two years or more, the settlor of the superficies may claim termination of the superficies. Article 288 (Claim for Termination of Superficies and Notification to Mortgagee) If a superficies is the subject matter of a mortgage, or the buildings or trees on the land are the subject matter of a mortgage, the claim under the preceding Article may be effected after a reasonable period has elapsed from the time when the mortgagees were so notified. Article 289 (Compulsory Provisions) Any contract which is against the provisions of Articles 280 through 287 and is disadvantageous to the superficiary has no effect. Article 289-2 (Sectional Superficies) (1) The space on or under the ground may be demarcated into upper or lower parts and may be the subject matter of the superficies for owning a building or other structures. In this case, the use of land may be restricted so as to exercise such superficies by means of an act of creation. (2) Even when a third person has a right to use and take profits from the land, if he and all persons who have rights to it, consent to do so, a sectional superficies as prescribed in paragraph (1) may be established. In this case, the third person who has the right to use and take profits from the land, shall not interfere with the exercise of the superficies. [This Article Newly Inserted by Act No. 3723, Apr. 10, 1984] Article 290 (Provisions Applied Mutatis Mutandis) (1) The provisions of Articles 213, 214, and 216 through 244 shall apply mutatis mutandis among superficiaries, or between a superficiary and the owner of the adjoining land. (2) The provisions of Articles 280 through 289 and paragraph (1) of this Article shall apply mutatis mutandis to the sectional superficies under Article 289-2. <Newly Inserted by Act No. 3723, Apr. 10, 1984>

CHAPTER Ⅴ SERVITUDE

Article 291 (Contents of Servitude) A person having a servitude is entitled to use the land of another person for the convenience and benefit of his own land for a certain purpose. Article 292 (Appendant Nature) (1) A servitude is transferred along with the ownership of the dominant land as appendant thereto and is subject to any rights other than the ownership existing over the dominant land, unless it is otherwise provided for by the act of creation. (2) A servitude may neither be assigned nor made the subject matter of any other rights apart from the dominant land. Article 293 (Co-ownership Relations, Partial Assignment and Indivisibility) (1) One co-owner of land cannot extinguish as to his own share a servitude existing for the benefit of the land or a servitude by which the land is dominated. (2) If land is partitioned, or a part thereof is assigned, servitude shall continue to exist for the benefit of each part of the dominant land or over each part of servient land: Provided, That this shall not apply to the other parts of the land if the servitude relates only to a part thereof. Article 294 (Period for Acquiring Servitude) The provisions of Article 245 shall apply mutatis mutandis only if a servitude is continuous and apparent. Article 295 (Acquisition and Indivisibility) (1) If one co-owner acquires a servitude, the other co-owners also acquire a servitude. (2) An interruption of acquisitive prescription of a servitude by possession as against co-owners shall not be effective unless it is made against each co-owner who exercises the servitude. Article 296 (Interruption, Suspension of Extinctive Prescription and Indivisibility) If there are two or more co-owners exercising the servitude an interruption or suspension of extinctive prescription of the servitude occurring in favor of one of them shall inure to the benefit of the other co-owners. Article 297 (Servitude for Water) (1) If the water on land subject to a right to water is not sufficient to meet the requirements of both the dominant and the servient lands, it shall, according to the demand of each piece of land, first be appropriated to household uses, and the remainder to other uses: Provided, That this shall not apply if it has been otherwise provided for by the act of creation. (2) If two or more rights to water have been created over one and the same servient land, the person having the subsequent right to water may not interfere with the use of the water by the person having a prior right to water. Article 298 (Obligation of Owner of Servient Land and Succession Thereof) If the owner of servient land has, by contract, assumed an obligation to construct structures, or to effect repairs thereon, at his own expense for the benefit of a servitude, such obligation shall devolve on limited successors in title of the owner of the servient land. Article 299 (Relief of Obligation by Surrendering) The owner of servient land may relieve himself of the obligation mentioned in the preceding Article by surrendering to the person entitled to the servitude the ownership of that portion of the land which is necessary for the servitude. Article 300 (Common Use of Structures) (1) The owner of servient land may use the structures on the servient land constructed by the person having the servitude for the benefit of the servitude, in so far as it does not interfere with the exercise of servitude. (2) In the case mentioned in the preceding paragraph, the owner of the servient land must bear the expense of the construction and preservation of the structures in proportion to the benefit which he derives therefrom. Article 301 (Provisions Applied Mutatis Mutandis) The provisions of Article 214 shall apply mutatis mutandis to servitude. Article 302 (Special Servitude) In a case where the inhabitants of a certain area, as a collective body, are entitled to take grass or trees, catch wild animals, take earth or sand, rear live stock, or take other profits from the land of the area owned by another person, the provisions of this Chapter shall apply mutatis mutandis subject to the custom of each locality.

CHAPTER Ⅵ CHONSEGWON (RIGHT TO REGISTERED LEASE ON DEPOSIT BASIS)

Article 303 (Contents of Chonsegwon) (1) Any person having chonsegwon is entitled to use it in conformity with its purposes and to take the profits from it, by paying the deposit money and possessing the real property owned by another person. Furthermore, he is also entitled to obtain the repayment of deposit money in preference to persons having the junior right or other creditors, with respect to the whole real property. <Amended by Act No. 3723, Apr. 10, 1984> (2) Farming land shall not be made the subject matter of chonsegwon. Article 304 (Effect of Chonsegwon on Superficies or Lease) (1) Where a contract of chonsegwon is created over a building on the land owned by another person, the effect thereof shall apply to the superficies created for the purpose of owning the building or lease. (2) In the case of the preceding paragraph, the settlor of chonsegwon may not perform any act which extinguishes the superficies or the lease without the consent of the person having chonsegwon. Article 305 (Chonsegwon over Building and Legal Superficies) (1) In a case where land with a building thereon belongs to one and the same person, and chonsegwon is created on the building, the limited successor in title of the land ownership, is deemed to have created legal superficies for the settlor of chonsegwon: Provided, That on application of the party to contract of chonsegwon, the rent thereon shall be determined by the court. (2) In the case of the preceding paragraph, the owner of the land shall not lease the land to another person, nor have any other superficies or chonsegwon created on it. Article 306 (Assignment and Lease of Chonsegwon, etc.) The person having chonsegwon may assign it to another person or provide it as security; and during the term of chonsegwon he may conclude a contract for chonchonse (sublet to another person) or lease the subject matter to another person: Provided, That this shall not apply in cases where chonchonse, leasing, and assignment are prohibited by the terms of the contract. Article 307 (Effect of Assignment of Chonsegwon) The assignee of chonsegwon has the same rights and duties as those of the assignor of the chonsegwon towards the settlor of the chonsegwon. Article 308 (Responsibility in a case where of Chonchonse, etc.) In case the subject matter of chonsegwon becomes that of chonchonse having chonsegwon who has so leased or contracted for chonchonse shall be responsible for the damage arising from an act of God which would not have arisen if the contract for chonchonse or leases had not been entered. Article 309 (Duties of Person Having Chonsegwon of Maintenance and Repair) The person having chonsegwon shall maintain the status quo condition of the subject matter of chonsegwon and shall perform necessary repairs in the ordinary course of the management thereof. Article 310 (Claim of Person Having Chonsegwon for Reimbursement) (1) If the person having chonsegwon has defrayed expenses for the purpose of improving the subject matter of chonsegwon, or other useful expenses, he may, so long as the increase in value remains, require reimbursement from the owner either of the amount defrayed, or the amount by which its value has increased, at the option of said owner. (2) In the case of the preceding paragraph, the court may, upon the application of the owner, allow him reasonable time for reimbursement. Article 311 (Claim of Extinguishment of Chonsegwon) (1) If a person having chonsegwon does not use or take profit from the subject matter of chonsegwon according to the terms applied to the use thereof, or according to the character of the subject matter, the settlor of chonsegwon may claim the extinguishment of chonsegwon. (2) In the case of the preceding paragraph, the settlor of chonsegwon may request the person having chonsegwon to restore the subject matter to its original condition or may demand compensation for loss in lieu thereof. Article 312 (Duration of Chonsegwon) (1) The duration of chonsegwon shall be for not more than 10 years. If the period prescribed in the contract exceeds 10 years, it shall be shortened to 10 years. (2) If the duration of chonsegwon for a building is fixed for a period less than one year, it shall be deemed as one year. <Newly Inserted by Act No. 3723, Apr. 10, 1984> (3) The chonsegwon may be renewed. The renewal period shall be not more than ten years from the date thereof. (4) When a person who has created chonsegwon, for a building has not notified the person, having chonsegwon of his refusal to renew the contract, or of the intention to the effect that he will not renew if the conditions thereof are not changed, within one to six months before the expiration of the duration of chonsegwon, it shall be considered that a new contract of chonsegwon is made under the same conditions as the previous one, at the expiration of the duration. In this case, the duration of chonsegwon shall be deemed not to have been determined. <Newly Inserted by Act No. 3723, Apr. 10, 1984> Article 312-2 (Right to Request Increase or Reduction of Deposit Money) If the amount of deposit money becomes inappropriate due to an increase or reduction of taxes, public imposts, or other charges related to the real property on which chonsegwon is created, or a fluctuation of the economic situation, a party may request an increase or reduction of the amount for the future: Provided, That in a case of an increase in amount, it shall not exceed the base rate as prescribed by Presidential Decree. [This Article Newly Inserted by Act No. 3723, Apr. 10, 1984] Article 313 (Notification of Extinguishment of Contract of Chonsegwon) If duration of chonsegwon is not provided in the contract, either party may notify at any time the other party of his intention to extinguish chonsegwon, and chonsegwon shall be extinguished after 6 months have elapsed from the date of receipt by the other party of notification. Article 314 (Loss by Act of God) (1) If the whole or part of the subject matter of chonsegwon is destroyed by an act of God over which the party has no control, the chonsegwon over the portion destroyed shall be extinguished. (2) If, in the case of partial destruction under the preceding paragraph, the person having chonsegwon cannot achieve the objective of chonsegwon with the remaining part, he may notify the settlor of chonsegwon of his intention to extinguish the entire chonsegwon and may demand the return of the deposit money. Article 315 (Responsibility of Person Having Chonsegwon for Compensation for Loss) (1) If the whole or part of the subject matter of chonsegwon is destroyed by some cause attributable to the person having chonsegwon, he is liable to compensate the settlor of chonsegwon. (2) In the case of the preceding paragraph, the settlor of chonsegwon shall have the right to apply the deposit money as compensation for the loss, and if there is any surplus, he shall return it to the person having chonsegwon. If it is insufficient, the settlor may make a demand for the balance. Article 316 (Duty to Restore to Original Condition, Right to Request Pur- chase) (1) When chonsegwon is extinguished according to terms for the duration of chonsegwon, the person having chonsegwon shall restore the subject matter thereof to its original condition and has the right to remove any things which he attached to the said subject matter. But, if the set- tlor of chonsegwon requests the purchase of the attached things, the per- son having chonsegwon may not refuse to sell without justifiable reasons. (2) In the case of the preceding paragraph, if the thing has been attached to the subject matter with the consent of the settlor of chonsegwon the person having chonsegwon may request the settlor to purchase the attached thing. The same shall apply in a case where the attached thing has been purchased from the settlor of chonsegwon. Article 317 (Extinction of Chonsegwon and Concurrent Performance) When chonsegwon is extinguished, the settlor of chonsegwon shall receive from the person having chonsegwon delivery of the subject matter and any documents necessary for the cancellation of the registration of chonsegwon. The settlor shall return the deposit money to the person having chonsegwon concurrently. Article 318 (Right of Person Having Chonsegwon to Request Auction) If the settlor of chonsegwon delays the return of the deposit money, the person having chonsegwon may request an auction of the subject matter of chonsegwon, in accordance with the Civil Execution Act. <Amended by Act No. 5454, Dec. 13, 1997; Act No. 6544, Dec. 29, 2001> Article 319 (Provisions Applied Mutatis Mutandis) The provisions of Articles 213, 214, and 216 through 244 shall apply mutatis mutandis between persons having chonsegwon, or between a person having chonsegwon and the owner of adjoining land or superficiaries.

CHAPTER Ⅶ RIGHT OF RETENTION

Article 320 (Contents of Right of Retention) (1) If the possessor of a thing or valuable instruments belonging to another person has any claim arising, in respect of such property or instruments and if payment of the claim is due, he may retain possession of the thing or instruments until the claim is satisfied. (2)The provisions of the preceding paragraph shall not apply if the possession has originated in an unlawful act. Article 321 (Indivisibility of Right of Retention) A person having a right of retention may exercise his right over the whole of the thing or valuable instruments retained until his claim has been fully satisfied. Article 322 (Auction, Summary Application for Satisfaction of Claim) (1) A person having a right of retention may sell the retained article at an auction in satisfaction of his claim. (2) A person having a right of retention, if he has justifiable reasons, may request the court to apply the retained article to the satisfaction of his claim at the price estimated by an appraiser. In such a case, the person having a right of retention shall inform the debtor of it in advance. Article 323 (Right of Collecting Fruits) (1) A person having a right of retention may collect the fruits produced from the retained article and may apply them to the satisfaction of his claim in preference to other creditors: Provided, That if the fruits are not in the form of money they shall be sold at an auction. (2) The fruits must first be applied to the payment of interest, the surplus if any, to the principal. Article 324 (Duty of Keeping Property with Care of Good Manager) (1) A person having a right of retention must keep the retained article with the care of a good manager. (2) A person having a right of retention may not, without the consent of the debtor, use or lease the retained article nor pledge it as security: Provided, That this shall not apply to such use of the thing as necessary for its preservation. (3) If a person having a right retention contravenes the provisions of the preceding two paragraphs, the debtor may demand the extinction of the right of retention. Article 325 (Right of Demanding Reimbursement) (1) If a person having a right of retention has defrayed necessary expenses in respect of the retained article, he may request reimbursement from the owner. (2) If a person having a right of retention has defrayed useful expenses in respect of the retained article, he may, as long as an increase in value remains, request reimbursement either of the amount defrayed or the amount by which its value has been increased at the option of the owner: Provided, That the court may, upon the application by the owner, allow him reasonable time to make reimbursement. Article 326 (Extinctive Prescription of Claim Secured) The exercise of a right of retention shall not prevent extinctive prescription from running against the claim. Article 327 (Furnishing Other Security and Extinction of Right of Retention) The debtor may demand the extinction of a right of retention on furnishing reasonable security. Article 328 (Loss of Possession and Extinction of Right of Retention) A right of retention shall be extinguished by the loss of possession.

CHAPTER Ⅷ PLEDGE

SECTION 1 Pledge of Movables

Article 329 (Contents of Pledge of Movables) A pledgee of movables is entitled to hold possession of the movables which he has received from the debtor or a third person as security for his claim, and to obtain satisfaction of his claim out of the movables in preference to other creditors. Article 330 (Delivery of Object of Pledge) A pledge shall become effective upon the delivery to the creditor of the object of pledge. Article 331 (Object of Pledge) A thing which can not be assigned shall not be the object of pledge. Article 332 (Ban on Holding Derivative Possession of Thing Pledged by Pledger) A pledgee cannot let the pledger hold possession of the pledged article on his behalf. Article 333 (Order of Priority of Several Pledges of Movables) If several pledges have been created on a movable to secure several debts, the order of their priority shall depend upon the date of their creation. Article 334 (Scope of Claim Secured) Unless otherwise provided by an agreement, a pledge shall secure the principal, interest, penalty, expense for enforcement of the pledge, expense for preservation of the pledged article, and the damages arising from the non-fulfilment of the obligation or from latent defects in the pledged article. Article 335 (Effect of Retaining) A pledgee may retain the pledged article until he obtains satisfaction of his claim prescribed in the preceding Article: Provided, That this right cannot be set up against any creditor who has priority to him. Article 336 (Sub-pledge) A pledgee may, within his own right, sub-pledge the pledged article on his own responsibility. In such case, he shall be responsible even for damages due to act of God which would not have occurred if the Article had not been sub-pledged. Article 337 (Requisites for Setting up Sub-pledge Against Debtors, etc.) (1) In the case prescribed in the preceding Article, the sub-pledge cannot be set up against the debtor, surety, pledger, and their successors in title unless the debtor has been notified of such sub-pledge or has given his consent thereto. (2) If the debtor has received notice or has given his consent thereto as prescribed in the preceding paragraph, no payment of debt made to the pledgee without the consent of the sub-pledgee can be set up against the sub-pledgee. Article 338 (Auction Summary Application for Satisfaction of Claim) (1) A pledgee may sell the pledged article by auction to obtain satisfaction of his claim. (2) A pledgee may apply to the court to have the pledged article appropriated to the satisfaction of the debt to the extent of its value appraised by an expert, provided there is a justifiable reason for doing so. In such case, the pledgee must give the debtor and pledger notice of the application in advance. Article 339 (Ban on Forfeited Pledge) A pledger may not, by a contract effected before the debt becomes due, agree that the pledgee shall by way of satisfaction of his claim acquire the ownership of the pledged article or dispose of it otherwise than in the manner provided for by Acts. Article 340 (Satisfaction of Claim out of Other Property than Pledged Article) (1) A pledgee may obtain satisfaction of his claim out of other property of the debtor only in respect to that portion which has not been satisfied out of the pledged article. (2) The provisions of the preceding paragraph shall not apply if other property is to be apportioned prior to the apportionment of the pledged article: Provided, That other creditors may ask the pledgee to deposit the apportioned amount. Article 341 (Right to Indemnity of Person Who Pledged One’s Property to Secure Another’s Obligation) If a person who has pledged his own property to secure a debt of another, discharges the debt or loses the ownership of the pledged article in consequence of the enforcement of the pledge, he is entitled to be indemnified by the debtor in accordance with the provisions relating to surety obligations. Article 342 (Exercise of Pledge against Things Other than Pledged Articles) A pledge may also be exercised against money or other things which the pledger is entitled to receive by reason of the loss, damage or expropriation of the pledged article. In such case, an attachment must be levied thereon prior to their payment or delivery. Article 343 (Provisions Applied Mutatis Mutandis) The provisions of Articles 249 through 251 and Articles 321 through 325 shall apply mutatis mutandis to pledges of movables. Article 344 (Pledges under Other Acts) The provisions of this Section shall apply mutatis mutandis to pledges created by the provisions of another Acts.

SECTION 2 Pledge of Rights

Article 345 (Object of Pledge of Rights) A property right may be the object of a pledge: Provided, That the right to use and take the profit from the immovable may not be the object of a pledge. Article 346 (Manner of Creating Pledge of Rights) Unless Otherwise provided by Acts, a pledge of rights must be created by the method regarding the transfer of such rights. Article 347 (Delivery of Documents Evidencing Obligation) Where a claim is made the object of a pledge and there exists a document evidencing such claim, the creation of the pledge shall take effect by the delivery to the pledgee of the document. Article 348 (Pledge against Mortgage Claim and Additional Registration of Pledge) Where a claim secured by a mortgage has been made the object of a pledge, this cannot be effective against the mortgage unless an additional registration of the pledge is entered in the registration of the mortgage. Article 349 (Requisite for Setting up Pledge for Nominative Claim) (1) Where a nominative claim has been made the object of a pledge, the creation of the pledge cannot be set up against the original debtor or other third person, unless he has been notified of it by the pledger in accordance with the provisions of Article 450 or unless the original debtor has given his consent thereto. (2) The provisions of Article 451 shall apply mutatis mutandis to the preceding paragraph. Article 350 (Method of Creating Pledge against Debt Payable to Order) Where a debt payable to order has been made the object of a pledge, the creation of the pledge shall take effect by the endorsement of the instrument and its delivery to the pledgee. Article 351 (Method of Creating Pledge against Bearer Instrument) Where a bearer instrument has been made the object of a pledge, the creation of the pledge shall take effect by the delivery to the pledgee of the instrument. Article 352 (Restriction on Disposition of Right by Pledger) Without the consent of a pledgee, a pledger cannot extinguish a right under the pledge, or cannot make any changes detrimental to the rights of the pledgee. Article 353 (Method of Execution of Claim under Pledge) (1) A pledgee may directly collect the claim under the pledge. (2) If the subject matter of a claim is money, the pledgee may obtain direct payment of only such portion thereof as corresponds to the amount of his own claim. (3) If the claim mentioned in the preceding paragraph has become due earlier than the pledgee’s claim, the pledgee may request the original debtor to deposit the amount payable with the Court Depository. In such case the pledge shall exist over the money so deposited. (4) If the object of the claim is a thing other than money, the pledgee may exercise his pledge over the thing discharged. Article 354 (Method of Execution of Claim under Pledge) In addition to the provisions of the preceding Article, a pledgee may enforce his pledge by the method of execution as provided for in the Civil Execution Act. <Amended by Act No. 6544, Dec. 29, 2001> Article 355 (Provisions Applied Mutatis Mutandis) In addition to the provisions of this Section, the provisions of the pledge of movables shall apply mutatis mutandis to the pledge of rights.

CHAPTERⅨMORTGAGE Article 356 (Contents of Mortgage) A mortgagee is entitled to obtain satisfaction of his claim in preference to other creditors out of the immovable which has been furnished by the debtor or by a third person as security without transferring its possession. Article 357 (Floating Sum Mortgage) (1) A mortgage can be created by settling only the maximum amount of the debt to be secured and reserving the determination of the debt in the future. In such case the extinction or transfer of the debt which occurred before the debt is determined cannot be effective against the mortgage. (2) In the case of the preceding paragraph the interest of the debt shall be considered to be included in the maximum amount of the debt. Article 358 (Scope of Effect of Mortgage) The effect of a mortgage shall extend to all things which are attached to the immovable that is mortgaged including its accessories: Provided, That this shall not apply to cases if otherwise provided by Acts or agreed in the act of creation. Article 359 (Effect upon Fruits) A mortgage shall be effective against the fruits which the mortgager has obtained or can obtain out of the mortgaged immovable after an attachment has been levied on it: Provided, That this cannot be set up against the third person who has obtained the ownership of a superficies or chonsegwon on the mortgaged immovable unless the mortgagee has notified him of the attachment. Article 360 (Scope of Claim Secured) A mortgage shall secure the principal, interest, penalty, damages arising from the nonperformance of the obligation, and the expense for the enforcement of the mortgage. Where the compensation for damages is delayed, a mortgage can be exercised only as regards the payments due in respect of one year after the lapse of time for the performance of the principal. Article 361 (Limits on Disposition of Mortgage) A mortgage cannot be assigned separately from its secured claim and also cannot be made the security of another claim. Article 362 (Supplement of Property Mortgaged) When the value of the property mortgaged has been conspicuously decreased by the acts attributable to a mortgager, a mortgagee may claim for recovery to the original state or the offer of reasonable security. Article 363 (Claim of Mortgagee for Auction Bidders) (1) A mortgagee may sell the mortgaged property by auction to obtain satisfaction of his claim. (2) A third person who has obtained the ownership of the mortgaged property may also bid at the auction. Article 364 (Payment of Debt by Third Party Purchaser) A third person who has obtained the ownership of a superficies or chonsegwon on the mortgaged immovable may make a claim for the extinction of the mortgage by payment of the debt to the mortgagee. Article 365 (Claim for Auction of Building on Mortgaged Land) Where the mortgagor has constructed a building on the land after a mortgage was created over the land, the mortgagee may sell such building by auction together with the land: Provided, That he has no right to obtain payment out of the auction proceeds of the building in preference to all others. Article 366 (Legal Superficies) Where the land and the building on it belong to different persons by reason of the auction sale of the mortgaged property, the owner of the land is deemed to have created a superficies for the owner of the building: Provided, That in such case the rent shall be determined by the court on the application of the party concerned. Article 367 (Claim of Third Party Purchaser for Reimbursement of Expenses) If the third party purchaser of the property mortgaged has defrayed necessary or useful expenses to preserve and improve the property, he may obtain reimbursement out of the proceeds of the auction sale of the property in preference to all others, according to the provisions of Article 203 (1) and (2). Article 368 (Joint Mortgages and Dividend of Proceeds thereof, Subrogation of Mortgagee Next in Priority) (1) Where two or more immovables are mortgaged to secure one claim and the proceeds of the auction are to be applied simultaneously to its satisfaction, the burdens in respect of the obligation shall be divided in proportion to the proceeds of the auction sale of each immovable. (2) If the proceeds of the auction sale of part of the immovables mentioned in the preceding paragraph are to be applied, the mortgagee may obtain full satisfaction of his claim out of the same; in such case the mortgagee next in priority may exercise the right of the prior mortgages by subrogation to the extent of the amount which the latter would have received out of other immovables in accordance with the provisions of the preceding paragraph. Article 369 (Appendant Nature) When the claim secured by a mortgage becomes extinct by completion of prescription or by any other reason, the mortgage shall also lapse with it. Article 370 (Provisions Applied Mutatis Mutandis) The provisions of Articles 214, 321, 333, 340, 341 and 342 shall apply mutatis mutandis to mortgages. Article 371 (Superficies and Chonsegwon Mortgaged) (1) The provisions of this Chapter shall apply mutatis mutandis to the case where a superficies or chonsegwon has been mortgaged. (2) A mortgagor who mortgaged a superficies or chonsegwon cannot take action to extinguish them without the consent of the mortgagee. Article 372 (Mortgages under Other Acts) The provisions of this Chapter shall apply mutatis mutandis to mortgages created by the provisions of other Acts.