[2] Whether it is valid for an association to enter into an agreement between its members or to enter into an ex post facto agreement to recognize the transfer of shares in order to freely transfer shares without the consent of the other union members (affirmative)

Therefore, even if a union agreed to settle profits and distribute dividends to union members on a quarterly basis, there is no reason to deem that a union member’s claim for annual dividends unfavorable to him/her than the quarterly settlement and dividend. Therefore, if the annual profit is recognized and the party claims dividends based on such recognition, the claim is not dismissed solely on the ground that the quarterly profit was not proven.

[2] In a partnership established by two or more persons by mutual investment to operate a joint business, the transfer of shares of a partner in the Civil Act requires the consent of all the other union members, in principle, but it is valid to enter into an agreement between the union members or to recognize the transfer of shares ex post facto without the consent of the other union members.

1. As to the ground of appeal on the claim for dividend payment

A. The plaintiffs are members of a cooperative established under the Civil Act (hereinafter referred to as the "instant cooperative") for the operation business of the Literature World Cup Center (hereinafter referred to as the "instant business"), and since net income was generated each year from the instant business during the period from 2004 to 2007, the defendants, who are the remaining members of the instant cooperative, are jointly and severally liable to pay the plaintiffs a profit-sharing amount for each plaintiff's share based on the pertinent net income.

According to the adopted evidence, the court below held that: (a) Co-Defendant 2 of the first instance trial entered into an agreement on investment and delegation of management rights (hereinafter “instant agreement”) with Co-Defendant 2 of the first instance trial to convert the business into a corporation on December 26, 2003, i.e., Defendant 2 and Co-Defendant 3 of the first instance trial on December 26, 2003, when operating the instant business and operating the instant business; and (b) concluded each investment agreement with Co-Defendant 2 of the first instance trial on December 26, 200 to distribute profits in proportion to the shareholders’ investment amount on a quarterly basis; and (c) the Plaintiffs, other than Plaintiff 6, entered into each of the instant agreements with Co-Defendant 2 of the first instance trial (hereinafter “each of the instant investment agreements”) with each of the instant investment agreements with each of the instant businesses four times annually; (d) the Plaintiffs calculated the settled profits as the fiscal period of the instant association; and (e) there is no evidence to acknowledge that members agreed to receive dividends on an annual basis.

B. However, the lower court’s determination is difficult to accept for the following reasons.

Where profits are settled on a quarterly basis with respect to the distribution of profits of partnership relations, such dividends may be claimed at the end of each quarter. If profits have accrued during a quarter, a claim for quarterly dividends may be made regardless of whether the losses have accrued to the other quarter. However, where a claim for annual dividends is made by year, the claim for dividends may be made by adding up and adding the quarterly profits and losses of the pertinent year to the amount of final profits available at the end of the pertinent year. Thus, in general, the annual dividends may be treated as disadvantageous

Therefore, as acknowledged by the court below, even if the association of this case agreed to settle the profit and distribute it to union members on a quarterly basis, it is not allowed to claim annual dividends unfavorable to them than the quarterly settlement and dividend. Therefore, if a yearly profit is recognized and the party claims dividends based on this, the claim shall not be rejected solely on the ground that the association failed to prove the quarterly profit as determined by the court below.

Furthermore, according to the reasoning of the lower judgment and the record, the Defendants’ act of calculating the net income of the instant association arising from the instant project on February 27, 2008 as KRW 1,556,643,651, KRW 2,300,629, KRW 275, KRW 2,607, KRW 324,019, and KRW 910,736,100 in 206, KRW 2007, KRW 324,019 in 2006, and KRW 910,736,00 in 207, KRW 375,333,045 in total for the pertinent net income, barring any special circumstance, there is sufficient room to deem that other members than the Defendants have the right to claim dividends equivalent to their own shares based on the pertinent net income.

Meanwhile, in a partnership established by two or more persons’ mutual investment to operate a joint business, the transfer of shares of the partnership members in principle requires the consent of all other partners, but it is valid to enter into an agreement between the partners or to recognize the transfer of shares ex post facto so that they may freely transfer their shares without the consent of all other partners. However, according to the records, the plaintiffs’ claim in this case contains the part claimed as a partner of the association in the first instance court, and the union in this case has already paid the previous dividends to some of the plaintiffs claiming that they acquired shares of the partnership members from co-defendant 2 of the first instance court. Therefore, the lower court should have examined whether there was a prior or ex post facto agreement on the transfer of shares of the union members in this case.

Nevertheless, the lower court rejected the Plaintiffs’ claim on the grounds that the Plaintiffs did not have any assertion or certification as to the quarterly profit of the instant association without examining and determining whether the Plaintiffs were entitled to a claim for dividend by other titles, such as subrogation of the members of the instant association or co-defendant 2 of the first instance court who concluded an investment agreement with the Plaintiffs, and the scope thereof, nature of the obligation to pay dividends and the subject of the obligation to pay dividends. In so doing, the lower court erred by exceeding the bounds of the principle of free evaluation of evidence in violation of logical and empirical rules, and by failing

2. Scope of reversal

In a case where the plaintiff filed an appeal against the appellate court's judgment that has dismissed both selectively joined claims or dismissed the lawsuit, the court of final appeal shall reverse the original judgment in its entirety when it recognizes that an appeal against one of the selective claims is well-grounded (see Supreme Court Decision 2006Da7995, Mar. 29, 2007). Since the part of the plaintiffs' claim for dividend payment in the claim in this case should be reversed as above, the part of the claim for dividend payment in the selective relation should be reversed as above, and the part of the claim for dividend payment in this selective relation should also be reversed. On the other hand, the part of the claim for damages claimed by the plaintiffs in the conjunctive relation should be reversed as the part

3. Conclusion

Therefore, without examining the remaining grounds of appeal by the plaintiffs, the judgment of the court below is entirely reversed, and this part of the case is remanded to the court below for a new trial and determination. It is so decided as per Disposition by the assent of all participating Justices on the bench.

[Attachment] List of Plaintiffs: Omitted

Justices Kim Shin (Presiding Justice)