(a) Reasons for cancelling the continuous contract;

(b) The case holding that where a separate agreement that constitutes a continuous contract under the premise that the obligation not to engage in competitive business is performed under the special agreement, the violation of the obligation not to engage in competitive business constitutes a ground for termination of the said agreement, which is a continuous contract

A. Since a continuous contract is based on the trust relationship between the parties. Therefore, in a case where one of the parties to the contract while the contract is in existence violates its contractual obligations and thus the trust relationship, which serves as the basis of the contract, is destroyed, making it difficult to maintain the contractual relationship as it is, it is reasonable to deem that the other party can terminate the contractual relationship immediately, thereby extinguishing it to the future.

B. The case holding that in case where Party A entered into a special contract with the condition that Party B would be granted a general sales right to the products of Party B and not sell products other than Party B’s supply, and as a result, Party B would take over the entire business of a specific sales office among the above sales offices and deduct the amount equivalent to the sales profit gained from Party B’s operation of the specific sales office for the next one year, and agreed to pay Party A the amount equivalent to Party B’s remuneration for the employees who will be engaged in the business of the above sales office under Party A’s dispatch order and pay Party A the amount equivalent to Party B’s remuneration for the employees who will be engaged in the business of the above sales office, it shall be deemed that Party B continued to perform the obligations under the above special contract, and thus, Party’s termination of the said contract on the ground that it violates Party A’s duty not to engage in competitive business under the above special contract.

Article 543 of the Civil Act

[Defendant-Appellant] Park Jae-ju, Counsel for defendant-appellant

[Defendant-Appellee] Korea Liven Co., Ltd., Counsel for defendant-appellee

Seoul High Court Decision 91Na67945 delivered on February 15, 1994

Of the judgment below, the part against the defendant shall be reversed.

This part of the case is remanded to the Seoul High Court.

The grounds of appeal are examined.

1. According to the reasoning of the judgment below, the court below determined that the above contract was concluded with the defendant company on June 1, 1986 and the above contract was concluded with the defendant's 2 with the above company for sale of pre-processed products (excluding short pressure and paint systems) and allowed the plaintiff to sell them in each area, such as Ulsan, Balyang, etc., and the defendant's mark, etc. shall not be used nor be automatically extended one year from the date of the contract with the plaintiff to the plaintiff under the condition that the above contract was concluded with the defendant's pre-determined 9, and the defendant's pre-determined 9 was no longer entitled to receive the above contract's pre-existing 9, and the above contract's pre-existing 9, which had been concluded with the defendant's pre-existing 9, the pre-existing 199, and the defendant had no pre-existing 9, which had no pre-existing 19,000 employees' pre-existing 9,000 employees' pre-existing 9,000.

2. According to the facts acknowledged by the court below, the agreement between the plaintiff and the defendant on March 21, 1989 between the plaintiff and the defendant on March 21, 198 was partially agreed on the operation of the Ulsan District Special Contract, and the defendant acquired from the plaintiff the business body of the business office for the next one year to dispatch its employees to the above business office for the defendant, and as a result, the defendant regularly pays to the plaintiff a certain amount monthly amount of money such as remuneration for the above employees, and then deducts the amount equivalent to the sales profit arising from the management of the above business office from the purchase price of the products that the plaintiff would be supplied to the defendant credit from the management of the port and the mining business office under the above special agreement. It is clear that this constitutes a continuous contract in that the payment, which constitutes the terms and obligations arising from the contract, continues to be made for a certain period.

Since such continuous contract is based on the trust relationship between the parties, in case where one of the parties to the contract while the contract is in existence violates the contractual obligation and thereby the trust relationship, which forms the basis of the contract, is destroyed and thereby making it difficult to maintain the contractual relationship as it is, it is reasonable to view that the other party can immediately terminate the contract relationship and terminate it to the future.

However, according to the court below's finding on June 1, 1986, the plaintiff bears the duty of no competition to grant the defendant's total sales right to the product supplied by the defendant during the contract period and not to handle and sell the product other than the product supplied by the defendant. While an employee of the above Ulsan Industrial Complex runs a sales business in each area such as Ulsan, Port, and Mineyang, it caused massive property damage to the Hyundai Motor Corporation, which is the supplier, due to the occurrence of unfair business purchase by the employee of the above Ulsan Industrial Complex around December 198, and caused large amount of damage to the defendant's product supply transaction from the above company. As a result, one of the measures to manage the defendant's product supply transaction is to acquire all the business of the above Ulsan Industrial Complex from the plaintiff, and one of the measures to manage the defendant's products is to deduct the amount equivalent to the plaintiff's sales profit derived from the above business's credit payment, and the defendant's duty of no more than the defendant's duty of no more than the contract's sales profit to the plaintiff's employees's contract.

Meanwhile, according to the records, the plaintiff entered into the agreement of this case as above, and as part of the other measures of poor business operation following the business transfer of the above Ulsan place, as part of which the defendant had been directly supplied and supplied metals to the Gwangju Heavy Heavy Co., Ltd. from February 1989, even though the defendant had already entered into an agreement of this case, it is difficult to conclude the agreement of this case on the grounds that the defendant's act of supplying metals to the Gwangju Heavy Heavy Co., Ltd. (Nihon Co., Ltd.) with the above pressure oil and its related products to produce the above pressure oil and its related products to independently operate the business of manufacturing and selling the same kind of products at the time. Thus, it is difficult to conclude the agreement of this case with the plaintiff on the premise that the contract of this case was completely terminated by the defendant's prior to the conclusion of the agreement of this case, and it constitutes a violation of the contract of this case's agreement of this case's 9 days prior to the conclusion of the agreement of this case's 9 days of termination.

Nevertheless, the court below rejected the defendant's assertion on the termination of the above special agreement, on the ground that the agreement of this case on March 21, 1989 between the plaintiff and the defendant was separate contract from the original special agreement contract, and thus, it cannot terminate the above special agreement contract because the plaintiff violated the obligation under the above special agreement, and further, even if not, the reason that the plaintiff planned the production business of the same product as the defendant's trade-handling product does not constitute a violation of the obligation under the above special agreement prohibition. Thus, the court below did not err in recognizing facts in violation of the rules of evidence or erred in the misapprehension of legal principles as to the continuous termination of the contract. Thus, the part pointing this out in the grounds of appeal is with merit.

3. Accordingly, without considering the defendant's remaining grounds of appeal, the part against the defendant among the judgment below shall be reversed, and this part of the case shall be 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.

Justices Park Jong-chul (Presiding Justice)