담보신탁과 분양보증신탁에 관한 연구

Abstract

This paper makes comprehensive research with regard to the collateral trust and the lotting-out guarantee trust (hereinafter “the LOG trust”), which has been frequently used in Korea. As for the collateral trust, the settlor transfers his asset to the trustee, with a view to setting up collateral to the creditor, i.e. the beneficiary. In case the settlor fails to repay, the trustee is entitled to dispose of the asset and provide proceeds from sale to the beneficiary. The most controversial issue in the area of the collateral trust is whether it should be governed mainly by the principle of collateral law or the law of trusts. In my view, the collateral trust must be deemed as a kind of the cestui que trust to be governed by the law of trusts on the following grounds. When we focus on the relationship between the parties, we can find high similarities between the status of the settlor, the trustee and the beneficiary in the collateral trust and those in the cestui que trust. The settlor transfers the ownership of his asset in the collateral trust, as the settlor in the cestui que trust does. Based upon such understanding, it is reasonable to say that in case the settlor becomes insolvent, the trust asset is not subject to the settlor's creditors. This means that the collateral trust has the function of insolvency protection as is the same in the cestui que trust. Also, it can also safely be said that even though the settlor's obligation to the beneficiary based upon the promissory note is transferred, the beneficiary can claim his right against the trustee as a beneficiary, since the beneficiary's right is not dependent upon the promissory note but upon the trust contract. As such, the collateral trust falls right into the scope of the law of the trusts. Another controversial issue in the collateral trust is on whom the duty of VAT payment must be imposed. Given that the collateral trust is a kind of the cestui que trust, the issue can be decided by the logic of the cestui que trust. In addition, this paper deals with the issues of the LOG trust. The LOG trust means that the settlor, the condominium construction company who parcels out the apartment, transfers both the construction site and the condominium to the trustee in order to protect the contractors󰡈the beneficiaries󰡈who are expected to claim the possession and ownership against the condominium when the construction is completed. In case the settlor becomes insolvent, the trustee is supposed to assume the obligation of the settlor to return the purchase money offered by the contractors. Once the settlor returns the purchase money, he is entitled to dispose of the trust asset (the construction site and the condominium) and appropriate proceeds from the sale for reimbursement for his payment to the contractors. This paper argues that the LOG trust is the mixture of the management trust and the collateral trust. Therefore, it is reasonable to say that the legal principle to be applied to the collateral trust can also be applied to the LOG trust. This might lead to the conclusion that the LOG trust has the function of insolvency protection as in the collateral trust, and further, the transfer of the construction site and the condominium to the trustee is a gratuitous conveyance.