[1] Requirements for false or exaggerated advertisements of goods to constitute deception

[2] In a case where a decision is made to terminate rehabilitation procedures while a lawsuit seeking confirmation of rehabilitation claims, etc. is pending, whether the purport of the claim seeking confirmation of rehabilitation claims, etc. should be modified to the purport of the claim seeking confirmation of rehabilitation claims, etc. (negative), and the validity of the judgment ordering the implementation of rehabilitation claims,

[1] The mere exaggeration or falsity is accompanied by the publicity and advertisement of the goods is insufficient to the extent that it can be accepted in light of the general commercial practice and the good faith principle. However, in a case where the specific facts about the important matters in the transaction were falsely notified in a manner to the extent that they would be criticized in light of the good faith duty, it constitutes a deception.

[2] When it is decided to grant authorization for a rehabilitation plan, any right of rehabilitation creditors, etc. shall be altered according to the rehabilitation plan, except any right recognized pursuant to the provisions of the rehabilitation plan or the Debtor Rehabilitation and Bankruptcy Act (hereinafter “Act”), and all rehabilitation claims and rehabilitation security rights shall take effect (Articles 251 and 252 of the Act), and even if the rehabilitation procedure is terminated after the rehabilitation plan is decided after the authorization is granted, the debtor is obligated to continue to perform the rehabilitation plan, such as repaying his/her obligations, as prescribed by the rehabilitation plan. Therefore, if the rehabilitation procedure is decided during the lawsuit seeking confirmation of the rehabilitation claim, etc., the purport of the claim seeking confirmation of the rehabilitation claim, etc. shall not be changed to the purport of seeking the implementation of the rehabilitation claim, etc., and if any creditor’s right becomes final and conclusive through the rehabilitation claim, etc. after the completion of the rehabilitation procedure becomes final and conclusive, it shall be processed in accordance with the provisions of the rehabilitation plan, etc., including the rehabilitation claim, etc.

[1] Article 110 of the Civil Act / [2] Articles 170(1), 172(1), 175, 251, 252, and 283 of the Debtor Rehabilitation and Bankruptcy Act

[1] Supreme Court Decision 92Da52665 delivered on August 13, 1993 (Gong1993Ha, 2417) Supreme Court Decision 2007Da44194 Delivered on October 23, 2008

See Attached List of Plaintiffs (Law Firm Taesan, Attorneys Kim Tae-hun, Counsel for the plaintiff-appellant)

Yantong Construction Co., Ltd. (LLC, Kim & Lee LLC, Attorneys Bailment-han et al., Counsel for the defendant-appellant)

Seoul High Court Decision 201Na25727, 25734, 25741 decided August 23, 2012

The judgment below is reversed and the case is remanded to Seoul High Court.

The grounds of appeal are examined.

1. As to the second ground for appeal

The false or exaggerated advertisements as referred to in Article 3(1) of the Act on Fair Labeling and Advertising (hereinafter referred to as the “Indication and Advertising Act”) mean advertisements which are different from facts or are likely to deceive or mislead consumers by excessively spreading facts, and are likely to undermine fair trade order. Whether the advertisements are likely to deceive consumers or mislead consumers, or are likely to mislead consumers, should be objectively determined on the basis of the overall and extreme increase that consumers with common caution receive the advertisement in question (see, e.g., Supreme Court Decisions 96Nu5636, Mar. 27, 1998; 2002Du6965, Jun. 27, 2003).

On the other hand, the mere exaggeration or falsity in advertising and advertising of goods may not be denied as long as it may be acceptable in light of the general commercial practice and the good faith principle. However, in a case where specific facts about important matters are falsely notified in a manner to the extent of being criticized in light of the good faith duty, it constitutes deception (see, e.g., Supreme Court Decisions 92Da52665, Aug. 13, 1993; 2007Da44194, Oct. 23, 2008).

For reasons indicated in its holding, the lower court determined that an act of labeling or advertising related to the road No. 1-43 as indicated in the holding of the lower judgment constitutes an act of labeling or advertising that is likely to mislead consumers into being aware that the road construction plan No. 1-43 as set forth in the above-mentioned 1-43 was finalized, or that it constitutes an act of labeling or advertising that is likely to mislead consumers into being aware of the fact, and that such act constitutes a case of falsely notifying important facts in apartment transactions in a way that would be subject to criticism in light of the duty of good faith.

Examining the reasoning of the judgment below in light of the aforementioned legal principles, the above judgment of the court below is just, and there is no error of law as to false or exaggerated advertisements.

2. As to the third ground for appeal

Examining the reasoning of the judgment below in light of the records and relevant legal principles, it is just for the court below to determine that the Defendant, a contractor of the apartment of this case, is liable for damages caused by false or exaggerated advertising under the Advertising and Advertising Act, as the subject of the act of labeling or advertising the apartment of this case, as the subject of the act of labeling or advertising the apartment of this case. There is no error in the misapprehension of legal principles as to false or exaggerated advertisements or joint tort.

3. As to the fourth ground for appeal

Examining the reasoning of the judgment below in light of the records, it is just that the court below calculated the amount equivalent to 3% of the sales price due to the false or exaggerated advertisements of this case on the grounds as stated in its reasoning, and there is no error of law such as misunderstanding of legal principles concerning

4. Regarding ground of appeal No. 1

When it is decided to grant authorization for a rehabilitation plan, any right of rehabilitation creditors, etc. shall be altered according to the rehabilitation plan and the effect of immunity shall accrue with respect to all rehabilitation claims and rehabilitation security rights except for any right recognized pursuant to the provisions of the Rehabilitation Plan or the Debtor Rehabilitation and Bankruptcy Act (hereinafter “Act”). Even if the rehabilitation procedure is terminated after the rehabilitation plan is decided after the authorization is granted, any obligation shall continue to perform the rehabilitation plan, such as repaying any obligation as prescribed by the rehabilitation plan. Therefore, in cases where the rehabilitation procedure is terminated while a lawsuit seeking the confirmation of a rehabilitation claim, etc. is pending, it is not necessary to change the purport of the claim seeking the confirmation of the rehabilitation claim, etc. to the purport of seeking the confirmation of the rehabilitation claim, etc., and if any creditor’s right becomes final and conclusive through the rehabilitation claim, etc. after the rehabilitation procedure is completed, the outcome of the lawsuit shall be entered in the rehabilitation plan, etc., and the rehabilitation procedure is dealt with in accordance with the provisions of the rehabilitation plan for the unpaid rehabilitation claim, etc.

According to the reasoning of the lower judgment and the record, the Plaintiffs filed a lawsuit against the Defendant and the Nonparty Company AFF, etc. on April 1, 2010. The first instance court dismissed the Plaintiffs’ primary claim on February 10, 201 after conducting necessary hearings, and rendered a judgment in favor of the Plaintiffs partially accepting the Plaintiffs’ primary claim on February 10, 201. Upon receipt of the order to commence rehabilitation procedures on November 24, 201, Plaintiff 60 reported rehabilitation claims on December 15, 201, and the rest of the Plaintiffs on December 22, 2011, upon receipt of an objection against the Nonparty’s report on the rehabilitation claims, the lower court determined that the Plaintiffs sought partial request for resumption of rehabilitation claims against the administrator of the rehabilitation company on January 30, 2012, and that the Plaintiffs sought partial confirmation of the rehabilitation claim on March 21, 201, and that the lower court revised the rehabilitation claim’s order on December 21, 2012.

According to the above legal principles, even if a decision to terminate rehabilitation procedures was rendered with respect to a rehabilitation company, the plaintiffs were confirmed through the rehabilitation claim confirmation lawsuit and were again seeking monetary payment. Therefore, the court below erred in the misapprehension of legal principles as to the confirmation of rehabilitation claims or the validity of the completion of rehabilitation procedures, which affected the conclusion of the judgment. The grounds of appeal pointing this out are with merit.

5. Conclusion

The lower judgment is reversed, and the case is remanded to the lower court for further proceedings consistent with this Opinion. It is so decided as per Disposition by the assent of all participating Justices on the bench.

[Attachment] List of Plaintiffs: Omitted

Justices Lee Sang-hoon (Presiding Justice)