(a) Whether a transferee of stocks is entitled to request a change of holders against the company where the company fails to issue stock certificates within six months from the date of its incorporation or the date of payment on new stocks;

B. The legal relationship where the truster of shareholder’s title terminates the title trust contract

A. The transfer of shares made before the issuance of share certificates is effective as against the company when six months have elapsed since its incorporation or the date of payment of new shares. In such a case, the transfer of shares takes effect only by the declaration of intention of the parties in accordance with the general principle as to the transfer of nominative claim. The transfer of shares in the register of shareholders under Article 337(1) of the Commercial Act is merely a requisite to set up against the transferee of shares in order to exercise shareholder's rights in relation to the company. Thus, in a case where a company fails to issue share certificates within six months after its incorporation or the date of payment of new shares, the transferee of the shares can request a change of title against the company by proving the transferee's sole transfer of

B. If a person who has entrusted a shareholder’s name terminates the title trust contract with the trustee, the shareholder’s right is immediately returned to the title truster, and it does not require a new legal act to transfer shares.

(a)Article 337(1)(a) of the Commercial Act; Article 335(2)(b) of the Commercial Act; Article 186 of the Civil Act / [title trust]

A. Supreme Court Decision 87Nu481 decided Oct. 11, 1988 (Gong1988, 1414) and Supreme Court Decision 89Meu14714 decided Oct. 24, 1989 (Gong1989, 1769) decided Aug. 13, 1991 (Gong1991, 2349)

[Defendant-Appellee] Plaintiff 1 and 3 others, Counsel for defendant-appellee

Defendant 1 and six others

Seoul Civil District Court Decision 92Na2676 delivered on March 26, 1992

All appeals are dismissed.

The costs of appeal are assessed against the plaintiffs.

1. Judgment on the ground of appeal No. 1 by the plaintiffs' attorney

A. The court below held that the plaintiff's primary claim of this case against the defendants for the implementation of the transfer procedure for the transfer of ownership to the above shares is entitled to a transfer of ownership solely against the company, and that the defendants, the transferor of the above shares, have no obligation to implement the transfer procedure. Thus, the court below held that the lawsuit against the primary claim of this case was unlawful as a claim against the non-party large company's non-party large company's company whose shares were not yet issued to each of the defendants.

B. The transfer of shares made before the issuance of share certificates is effective as against the company at the expiration of six months after the date of incorporation or after the date of payment of new shares (Article 335(2) of the Commercial Act). In such a case, the transfer of shares takes effect only by the declaration of intention of the parties in accordance with the general principle as to the transfer of nominative claim (see Supreme Court Decision 87Nu481, Oct. 11, 1988). The transfer of shares in the register of shareholders under Article 337(1) of the Commercial Act is merely a requisite to exercise shareholder's rights in relation to the company by which the transferee of shares must exercise shareholder's rights (see Supreme Court Decision 89Meu14714, Oct. 24, 1989). Thus, in a case where a company fails to issue share certificates within six months after the date of incorporation or after the date of payment of new shares, the transferee of shares by expressing intention alone shall be interpreted to have the right to request the transfer of shares to the company.

In addition, if a person who has entrusted a shareholder's name terminates the title trust contract with the trustee, the shareholder's right is returned to the truster, and it does not require a new legal act to transfer shares.

Therefore, even if the plaintiffs entrusted the name of shareholders as to the shares before the issuance of share certificates to the defendants, but terminated the title trust contract after six months from the date of incorporation or the date of payment of new shares, it cannot be said that there is a benefit of lawsuit to seek the implementation of the transfer procedure against the defendants, the trustee, without claiming a change of change of holders in the register of shareholders, by proving such fact.

Of course, as pointed out in the theory of theory, in the event a dispute arises over the ownership of shareholder rights between the transferor and transferee of shares before the issuance of share certificates or between the title truster and the trustee, the transferee or the title truster of shares may be required to submit to the company with supporting documents for the change of ownership on the register of shareholders after filing a lawsuit for verification of shareholder rights against the transferor or the title trustee. However, it cannot be deemed that the transferee or the title truster of shares can immediately claim against the transferor or the title trustee for the implementation of the transfer of

The court below's rejection of the plaintiffs' primary claim in this case by taking the above-mentioned opinion is without sufficient reasons, but the conclusion is justified. The judgment below did not err by misapprehending the legal principles as to the method of transfer of shares before issuance of share certificates and the validity of termination of a title trust agreement, or by misapprehending the legal principles as to the termination of a title trust agreement, or by exceeding the Supreme Court's decision. Thus, there

2. Determination on the ground of appeal No. 2

In sum, the Plaintiffs’ instant conjunctive claim is a claim for the transfer of shares (i.e., shareholders’ rights) due to the termination of a title trust agreement with respect to each of the shares held in trust with the Defendants, and the lower court determined that the Plaintiff’s claim for the transfer of share certificates was erroneous.

However, according to the records, it is clear that the plaintiffs' attorney stated a petition of appeal at the first date for pleading of the court below as well as that of the preliminary purport of the claim for transfer of share certificates, and that the pleading has been concluded immediately. In addition, if a person who held a trust with respect to the shares before the issuance of share certificates terminates a title trust contract against the trustee, the shareholders' rights to the shares are returned to the title truster merely by the declaration of termination of the contract, and thus, it is not necessary to make a separate claim for transfer of the shareholders' rights. Thus, without examining the judgment of the court below on the premise that the preliminary claim by the plaintiffs is claimed for transfer of the shareholders' rights, it is not acceptable to argue that the plaintiffs' mistake of the subject matter of the judgment by neglecting to exercise the right for explanation, or erred by misapprehending the legal principles on the transfer of shares before the issuance of

3. Therefore, all appeals are dismissed, and the costs of appeal are assessed against the losing plaintiffs. It is so decided as per Disposition by the assent of all participating Justices.

Justices Yoon Jae-ho (Presiding Justice)