Korea Deposit Insurance Corporation

The defendant's appeal is dismissed.

1. As to the Defendant’s ground of appeal

(1) As to ground of appeal No. 1

For the reasons indicated in its holding, the lower court determined that B Co., Ltd. (hereinafter referred to as “B”) falsely entered the ratio of BS equity capital and asset soundness based on the false financial statements prepared by divating the allowance for bad debts in the business report, etc. to issue the instant subordinated bonds, and that such ratio of BS equity capital and BS equity capital constitutes “important matters” under Article 47(3) of the Financial Investment Services and Capital Markets Act (hereinafter referred to as the “Capital Markets Act”) due to matters that significantly affect the investors’ judgment to purchase the instant subordinated bonds or the value of the pertinent financial investment instruments. Examining the relevant legal principles and records, the lower court’s aforementioned determination is justifiable. In so doing, it did not err by exceeding the bounds of the principle of free evaluation of evidence against logical and empirical rules, or by misapprehending the legal doctrine on “important matters” under the Capital Markets Act

(2) As to the ground of appeal No. 2, Article 125(1) main text of the Capital Markets Act provides that where a purchaser of securities suffers damage due to a false description or representation of a material fact in a registration statement (including a corrective registration statement and accompanying documents; hereinafter the same shall apply) and an investment prospectus (including a preliminary investment prospectus and a short-form investment prospectus; hereinafter the same shall apply), any person falling under any subparagraph of Article 125(1) of the Capital Markets Act shall be liable for damages incurred therefrom. The Capital Markets Act strictly separates the liability for disclosure in the market of securities and the liability for disclosure in the market of distribution. Article 125(1) of the same Act provides that the liability for damages shall be limited to the requirement for damages and the scope of damages prescribed by the Act to protect investors participating in the market of securities by converting the burden of proof into the issuance of securities. See Chapter 20, a person who acquired securities can be deemed to have been subject to tort liability under the proviso to Article 125(1)9 of the same Act.

Upon examining the records in accordance with the above legal principles, the Plaintiff could have known that the lower court purchased the instant subordinated bonds in the distribution market on October 29, 2010, and thus, the Plaintiff is not included in the right to claim damages under Article 125(1) of the Capital Markets Act. Accordingly, the lower court erred by misapprehending the legal doctrine on Article 125(1) of the Capital Markets Act, which determined otherwise, that the Plaintiff may claim damages under Article 125(1) of the said Act. However, upon the Plaintiff’s selective claim, the lower court determined that the Plaintiff was liable for damages to the Plaintiff who acquired the instant subordinated company pursuant to Article 162(1) of the said Act, and that such determination is justifiable, as seen thereafter, the lower court did not affect the conclusion of the judgment.

(3) As to the grounds of appeal Nos. 3 and 4, where a purchaser of stocks claims compensation for damages caused by false statements in a business report, etc., based on Article 162(1) of the Financial Investment Services and Capital Markets Act, the person liable to compensate for damages must prove that he/she could not have known such fact although he/she exercised reasonable care, or that the purchaser of stocks was aware of such fact when he/she acquired the stocks, or that all or part of the amount of damages suffered by the purchaser was not caused by such false statements, etc. (see Supreme Court Decision 2013Da76253, Dec. 24, 2014).

For reasons indicated in its holding, the lower court rejected the Defendant’s assertion asserting that there was no causation between false description in the business report and the Plaintiff’s acquisition of subordinated bonds of this case and the Plaintiff’s loss.

Examining the record in accordance with the above legal doctrine, the lower court’s determination is justifiable. In so doing, it did not err by exceeding the bounds of the principle of free evaluation of evidence against logical and empirical rules without exhaust all necessary deliberations

(4) As to the ground of appeal No. 5, the fact-finding or the ratio of limitation of liability for the fair apportionment of comparative negligence or loss in the damage compensation case is the exclusive authority of the fact-finding court, unless it is deemed that such finding or ratio is clearly unreasonable in light of the principle of equity (see, e.g., Supreme Court Decision 2014Da3283, Jan. 29, 2015).

Examining the record, the lower court is justifiable to limit B’s liability to 60% on the grounds stated in its reasoning. In so doing, the lower court did not err by misapprehending the legal doctrine on omission of judgment, limitation of liability, and nature of subordinate bonds.

2. Plaintiff’s ground of appeal

(1) As to the assertion regarding the purchased principal

The lower court determined the scope of damages for violation of the Capital Markets Act, and presumed that the Plaintiff’s purchase principal, not KRW 3,009,000, not KRW 3,000,000, as the Plaintiff’s damages, when acquiring priority bonds after the instant case.

Examining the reasoning and record of the lower judgment, the lower court’s aforementioned determination is justifiable inasmuch as the Plaintiff asserted that the purchase principal of the instant subordinated bonds was KRW 3,00,000 and claimed for the amount of damages, and the lower court rendered the aforementioned determination based on the aforementioned determination. In so doing, the lower court did not err by exceeding the bounds of the principle of free evaluation of evidence in violation of logical and empirical rules

(2) In cases where damages are claimed based on tort under the Civil Act on the ground that the appraisal of corporate bonds was caused by the purchase of corporate bonds due to a false description about the point of time of occurrence of damages and the claim for damages, the amount of damages shall be calculated as at the time of purchase of corporate bonds, in principle, as the amount calculated by deducting the value of corporate bonds that would have been formed without any false description about the actual value of corporate bonds, namely, the registration statement and the investment prospectus, from the purchase price of corporate bonds, as at the time of purchase of corporate bonds. In addition, inasmuch as liability for damages arising from tort is established in light of the concept of fairness, even if there is no separate demand for payment, and as such, liability for damages arising from a false description about an important matter in the registration statement and the investment prospectus, Article 125(1) of the Financial Investment Services and Capital Markets Act also applies to liability for damages arising from a fraudulent act (see, e.g., Article 126(1) of the said Act). The presumption that liability for damages incurred by a person acquiring securities is not different from the actual liability under Article 126(15(1) of the Commercial Act.

As examined in the judgment as to the Defendant’s ground of appeal No. 1, B entered the ratio of BS equity capital and asset soundness based on false financial statements prepared by making an act in writing by understating the allowance for bad debts in the business report for issuing the instant subordinated bonds, and the ratio of BS equity capital and BS equity capital is an important factor. Therefore, barring any special circumstance, B is liable for compensating the Plaintiff for damages incurred by the Plaintiff who believed the entry in the business report as above and acquired the instant subordinated bonds in accordance with Article 162(1) of the Financial Investment Services and Capital Markets Act. The Plaintiff’s damages are immediately generated on October 29, 2010, on which the date when the Plaintiff paid the purchase price, while purchasing the instant subordinated bonds. Furthermore, the damages for damages for the right to claim damages accrued from the initial date.

Nevertheless, the lower court determined that the Plaintiff’s loss incurred on September 7, 2012, which is the date when the Plaintiff was declared bankrupt B, and the delay damages for the claim for damages occurred from this time. In so doing, the lower court erred by misapprehending the legal doctrine on the timing of occurrence of damages and the starting point of calculating damages for delay under Article 162(1) of the Capital Markets Act, thereby affecting the conclusion of the judgment

(3) As to the remaining arguments

In calculating the amount of damages suffered by the Plaintiff, the Plaintiff includes the statutory interest calculated at the rate of 5% per annum for the purchase price of the subordinated bonds of this case as ordinary damages, and includes the interest income accrued from investment in the stable financial products with at least 5% per annum as special damages, and such losses are acknowledged as proximate causal relation with the tort B, the lower court otherwise determined that there exists a misapprehension of the rules of evidence, misconception of facts, omission of judgment, lack of reasoning, calculation of damages and causal relation.

However, as seen earlier, insofar as it is deemed that the Plaintiff’s damage was immediately caused when purchasing subordinated bonds of this case and paying the purchase price, there is no room for the Plaintiff to obtain statutory interest or interest on the purchase price until the damage was incurred, and thus, the above ground of appeal cannot be accepted.

3. Conclusion

Therefore, the part of the lower judgment against the Plaintiff is reversed, and that part of the case is remanded to the lower court for further proceedings consistent with this Opinion. The Defendant’s appeal is dismissed. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Kim Jae-tae

Justices Jo Hee-de

Justices Park Sang-ok