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Supreme Court Decision 2024Da315046, March 13, 2025 [Increase of Rent]
〈Case concerning whether a lease agreement was renewed〉
【Holding】
The manner in which a lessor raises an objection to the renewal of a lease agreement under Article 639(1) of the Civil Act, and the circumstances in which an implied or conditional objection may be found / Whether the mere fact that the lessor exercised the right to demand an increase in rent under Article 628 of the Civil Act after the expiration of the lease term can be regarded as an objection under Article 639(1) of the Civil Act made on the basis of the lessor's intention not to continue the lease relationship (negative)
【Summary of Decision】
The main text of Article 639(1) of the Civil Act provides that "where, after the expiration of the lease term, the lessee continues to use and take the profits of the leased object and the lessor does not raise an objection within a reasonable period, the lease is deemed to have been made again on the same terms as the previous lease." Here, the lessor's objection may be made not only expressly but also impliedly, and may also be made conditionally, such as stating that the lease relationship will not be continued unless the rent is increased. However, in light of the purpose of the above provision, which is to protect the lessee's reliance, in order to find that an implied or conditional objection was made, there must be circumstances from which the lessor's intention not to continue the lease relationship can be objectively inferred. Meanwhile, since the right to demand an increase in rent under Article 628 of the Civil Act is a right exercised on the premise that the lease agreement continues to exist, the mere fact that the lessor exercised the right to demand an increase in rent after the expiration of the previous lease term is not sufficient to find that the lessor raised an objection under Article 639(1) of the Civil Act on the basis of an intention not to continue the lease relationship.
【Referenced Statutes】
Articles 628 and 639(1) of the Civil Act
(Source: Supreme Court Decision 2024Da315046, March 13, 2025 | Judicial Information Disclosure Portal, Precedents)
【Holding】
The manner in which a lessor raises an objection to the renewal of a lease agreement under Article 639(1) of the Civil Act, and the circumstances in which an implied or conditional objection may be found / Whether the mere fact that the lessor exercised the right to demand an increase in rent under Article 628 of the Civil Act after the expiration of the lease term can be regarded as an objection under Article 639(1) of the Civil Act made on the basis of the lessor's intention not to continue the lease relationship (negative)
【Summary of Decision】
The main text of Article 639(1) of the Civil Act provides that "where, after the expiration of the lease term, the lessee continues to use and take the profits of the leased object and the lessor does not raise an objection within a reasonable period, the lease is deemed to have been made again on the same terms as the previous lease." Here, the lessor's objection may be made not only expressly but also impliedly, and may also be made conditionally, such as stating that the lease relationship will not be continued unless the rent is increased. However, in light of the purpose of the above provision, which is to protect the lessee's reliance, in order to find that an implied or conditional objection was made, there must be circumstances from which the lessor's intention not to continue the lease relationship can be objectively inferred. Meanwhile, since the right to demand an increase in rent under Article 628 of the Civil Act is a right exercised on the premise that the lease agreement continues to exist, the mere fact that the lessor exercised the right to demand an increase in rent after the expiration of the previous lease term is not sufficient to find that the lessor raised an objection under Article 639(1) of the Civil Act on the basis of an intention not to continue the lease relationship.
【Referenced Statutes】
Articles 628 and 639(1) of the Civil Act
(Source: Supreme Court Decision 2024Da315046, March 13, 2025 | Judicial Information Disclosure Portal, Precedents)