On August 24, 2005, the Plaintiff and the Defendant concluded a loan contract with 11% interest rate of KRW 121,000,000 as of August 24, 201, and as of August 24, 2010 as of the due date (the extension after the due date) and the loan contract with KRW 17,50,000 as of May 19, 2008 as the interest rate of KRW 12% and May 19, 201 as of the due date (the extension after the due date) respectively. The Defendant deposited each of the above loans into the account in the Plaintiff’s name on the date of the above loan.

B. Around May 25, 2011, the Defendant sent to the Plaintiff a notice demanding the Plaintiff to repay each of the total amount of KRW 141,284,532 with respect to the above loans, and KRW 19,390,112 with respect to the above loans, and around that time, the above notice reached the Plaintiff.

2. Judgment on the plaintiff's assertion

A. The plaintiff's assertion that each of the above lending contracts was concluded based on a false agreement with the defendant. Thus, the plaintiff's assertion that each of the above lending contracts with the defendant does not exist any obligation under the above lending contracts with the defendant.

B. In a case where a substantial principal debtor pays a third party with respect to the amount of debt that he/she intends to actually borrow, and a financial institution has understood that it does not assume responsibility as a debtor with respect to a third party, a third party is merely a person who lends only a type of name, and the substantial party to the loan contract is a financial institution and a substantial principal debtor. Thus, a loan agreement in the name of a third party is a loan agreement in the name of a financial institution and is formally done without the intent to bear the debt pursuant to the agreement of the financial institution, and thus constitutes an invalid legal act that constitutes a false declaration of conspiracy.

Supreme Court Decision 200 delivered on May 29, 2001