[Defendant-Appellant] K&C Co., Ltd. (Law Firm Yangyang, Attorneys Jeong Woo-soo et al., Counsel for defendant-appellant)

Suwon Development Co., Ltd and one other (Law Firm Pacific, Attorneys Cho Jong-sung et al., Counsel for the plaintiff-appellant)

May 13, 2011

1. Defendant Samsan Development Co., Ltd. pays KRW 623,276,00 to the Plaintiff.

2. The Plaintiff’s remaining claims against Defendant Sambu Development Co., Ltd. and Defendant Sambu Development Co., Ltd.’s compact system are dismissed, respectively.

3. Of the costs of lawsuit, 1/10 of the portion arising between the Plaintiff and Defendant Sambu Development Co., Ltd. shall be borne by the Plaintiff, the remainder by Defendant Sambu Development Co., Ltd., respectively, and the part arising between the Plaintiff and Defendant Sambu Development

4. Paragraph 1 can be provisionally executed.

1. Defendant Samsan Development Co., Ltd. shall pay to the Plaintiff 623,276,00 won with 20% interest per annum from the day following the delivery of a copy of the claim of this case and the application for modification of the cause of this case to the day of complete payment.

2. Selectively, the share sales contract concluded on November 14, 2006 with respect to the shares listed in the separate sheet between the Nonparty and the Defendant Samsung Development Co., Ltd. is revoked. The Plaintiff’s compact system, based on the procedure for re-issuance of share certificates with respect to the shares listed in the separate sheet, shall deliver to the Nonparty the share certificates re-issued to the Nonparty; or (2) the Defendant’s compact system, based on the procedure for re-issuance of share certificates with respect to the shares listed in the separate sheet, shall deliver the share certificates re

1. Basic facts

A. Defendant Sambu Development Co., Ltd. (hereinafter “Defendant Sambu Development”) is an unlisted corporation established for the purpose of establishing and managing a comprehensive sports center, and Article 11 of the articles of incorporation of the said company requires the approval of the board of directors to transfer the shares of the said company.

B. Broom Co., Ltd. received loans from a good mutual savings bank (hereinafter “good mutual savings bank”). On May 31, 2005, KRW 400 million, KRW 2300 million on June 24, 2005, and KRW 600 million on July 6, 2005, respectively. At the time, the Nonparty, a representative director of Dabroom Co., Ltd, at the time, issued the share certificates of this case by providing a good mutual savings bank with the maximum debt amount of KRW 1.3 billion on July 6, 2005 in order to secure part of the above loan obligations (hereinafter “instant shares”), without obtaining approval from the board of directors of the above company.

C. On March 16, 2007, the Plaintiff (the Plaintiff), upon receipt of a decision to transfer a contract from the Financial Supervisory Commission under the Act on the Structural Improvement of the Financial Industry, completed the procedure of the public announcement on the same day, and around that time, he/she currently holds the instant share certificates issued by a good mutual savings bank.

D. On November 14, 2006, the Nonparty (hereinafter “instant judgment of nullification”) was sentenced to a nullification on May 7, 2007, with the purport of declaring the invalidity of the instant share certificates (hereinafter “instant judgment of nullification”) after transferring the instant shares to the Defendant Comex System (hereinafter “Defendant Comex System”) the price of KRW 590 million.

E. On June 26, 2007, Defendant Sambu Development approved the transfer of the shares to the Nonparty’s compact system through a resolution of the board of directors on June 26, 2007, and re-issued the share certificates representing the instant shares upon the Nonparty’s request for re-issuance of the share certificates based on the judgment of nullification of the instant case, and issued them to the Defendant

F. The Plaintiff filed a lawsuit of dissatisfaction with regard to the nullification judgment of this case with the Jung Government District Court 2007Kadan59462, and the above court revoked the nullification judgment of this case on January 22, 2008 and rendered a judgment dismissing the Nonparty’s application for the nullification judgment, and around that time, the said judgment became final and conclusive.

G. Around July 30, 2009, the Plaintiff filed a claim for the approval of the said share transfer security between the Nonparty and a good mutual savings bank for Defendant Samsan Development. However, Defendant Samsan Development notified the Plaintiff of the refusal of approval on August 26, 2009.

H. On September 9, 2009, the Plaintiff filed a claim for the purchase of the instant shares with respect to Defendant Samsan Development. However, as the said parties did not reach an agreement on the purchase price, the Plaintiff filed an application for the determination of purchase price of the instant shares with the District Court Decision 2009Bu25, the said court decided that the purchase price of the instant shares was KRW 3,116,380 per share on April 1, 2010, and the said determination became final and conclusive around that time because the Plaintiff and Defendant Samsan Development did not file an appeal.

[Reasons for Recognition] Unsatisfy, Gap evidence 1 through 13, 15, Eul evidence 1, 2, 3, 5 through 9 (including each number), the purport of the whole pleadings

2. The assertion and judgment

A. Claim for Defendant Sambu Development

(1) The plaintiff's assertion

The Plaintiff received the instant shares from a good mutual savings bank as a security for transfer according to the FSC’s decision to transfer a contract. As Defendant Samsan Development refused to approve the transfer of the instant shares between Nonparty and a good mutual savings bank, and the Plaintiff exercised the instant appraisal right regarding Defendant Sambu Development, but did not reach an agreement on the purchase price, Defendant Sambu Development is obligated to pay to the Plaintiff the purchase price of KRW 623,276,00 (=3,116,380 per share x 200 per share) determined by the court as the purchase price of the instant shares and delay damages therefor.

(2) Determination on the cause of the claim

(A) In light of the purport of Articles 35-7, 335-2(2) through (4), 335-6, and 374-2(2) through (5) of the Commercial Act, which regulate the transfer of shares by a transferee of shares with the approval of the board of directors, the said appraisal right of the transferee of shares is so-called “the right of formation,” regardless of the consent of the company, and thus, a sales contract for shares is established regardless of whether it has been approved by the exercise of such right (see Supreme Court Decision 2010Da94953, Apr. 28, 201).

Therefore, on July 6, 2005, the Plaintiff offered the instant shares as security for transfer to a good mutual savings bank without obtaining approval from the board of directors of Defendant Samsan Development, and the Plaintiff completed the procedure of public announcement on the same day after obtaining a decision of the Financial Supervisory Commission on March 16, 2007. As seen earlier, the Plaintiff received each of the above loan claims against the Nonparty of a good mutual savings bank upon succession to the same legal relationship as that of the good mutual savings bank, and received the instant shares as security for transfer. As such, the Plaintiff was provided with the instant shares as security for transfer. Accordingly, upon the Plaintiff’s refusal to approve the transfer for transfer of the said shares by exercising the instant appraisal right on September 9, 2009 for Defendant Samsan Development, the sales contract for the instant shares was established between the Plaintiff and Defendant Samsan Development by exercising the appraisal right on September 9, 200

Therefore, insofar as there is no agreement between the Plaintiff and Defendant Samsan Development on the purchase price of the instant shares, Defendant Samsan Development is obligated to pay the Plaintiff KRW 623,276,00 (=3,116,380 per share x 200 per share), which is the purchase price of the instant shares pursuant to the court’s decision.

(B) As to the claim for damages for delay

The Plaintiff also claims for the payment of damages for delay of KRW 623,276,00 for the purchase price of the instant shares for Defendant Samsan Development.

However, Article 374-2 (2) of the Commercial Act, which applies mutatis mutandis pursuant to Articles 335-7 (2) and 335-6 of the same Act, provides that “the company shall purchase the relevant shares within two months from the date of receipt of the request for purchase of shares.” Here, “two months from the date of receipt of the request for purchase of shares by the company,” regardless of whether the purchase price of shares becomes final and conclusive, shall be construed to have determined the due date for the payment of the purchase price of shares by the company (see Supreme Court Decision 2010Da94953, Apr. 28, 201). As such, the due date for which the Plaintiff was liable to pay the purchase price to the Plaintiff of the Defendant Samsan Development from September 9, 2009, which was two months after the date of receipt of the request for purchase of shares.”

However, in light of the provisions of Article 36(1) of the Commercial Act that the Plaintiff’s exercise of the above appraisal right and the Plaintiff’s exercise of the above appraisal right entered into a sales contract for the instant shares and that the share certificate should be given in the transfer of shares, the Plaintiff is obligated to deliver the instant share certificates to Defendant Samsan Development pursuant to the above sales contract. Accordingly, the Plaintiff’s obligation to deliver the instant share certificates and the obligation to pay the above sales price for Defendant Samsan Development is in a simultaneous performance relationship. In the event both obligations are in a simultaneous performance relationship, the Plaintiff’s obligation to deliver the instant share certificates and the obligation to pay the above sales price for Defendant Samsan Development is not in a simultaneous performance relationship. In the event both obligations are in a concurrent performance relationship, even if the due date for the other party’s obligation comes, the Plaintiff is not liable for the delay of performance until the other party’s obligation is performed. Such effect does not necessarily result in the exercise of the right of defense for the simultaneous performance delay (see, e.g., Supreme Court Decision 2001Da3764, Jul. 10, 201).

(3) Determination as to the assertion of Defendant Samsan Development

(A) As to the assertion that the Defendant’s Comact System lawfully succeeded to and acquired the shares of this case

Defendant Sambu Development asserts to the effect that the Plaintiff cannot exercise the appraisal right of this case since Defendant Sambu Development duly succeeded to the shares of this case by acquiring the shares of this case by acquiring the shares of this case from the Nonparty and obtaining approval from the board of directors of Defendant Sambu Development with respect to the transfer of the shares of this case.

However, in a case where share certificates are lost, the company may not be requested to re-issuance of share certificates unless the judgment of nullification is obtained through the procedure of public summons (see Supreme Court Decision 81Da141, Sept. 8, 1981, etc.). Since the judgment revoking the judgment of nullification of this case was rendered on Jan. 12, 2008 and its confirmation became final and conclusive around that time is as seen earlier, the validity of the judgment of nullification of this case becomes null and void retroactively as the above revocation judgment becomes final and conclusive, and the share certificates re-issued on the premise that the judgment of nullification of this case is valid as above is null and void, barring any special circumstances, so the above re-issued share certificates become null and void. Thus, the above argument of Defendant Sam-sung Development, which duly succeeded and acquired the shares of this case by acquiring the re-issued share certificates, is without merit.

(B) As to the assertion that the Defendant’s compact system bona fide acquired the instant shares

Defendant Sambu Development asserts to the effect that the Plaintiff cannot exercise the appraisal right of this case (the assertion that the Plaintiff bona fide acquisition of the “instant shares”) because it acquired the instant shares in good faith and without fault after taking over the instant shares from the Nonparty without knowing the fact that the instant shares were concluded between the Nonparty and good mutual savings banks (the assertion that the instant shares were acquired in good faith).

The issuance of share certificates under Article 355 of the Commercial Act refers to the preparation and delivery of a document in the form prescribed in Article 356 of the same Act, and only when the document is issued to a shareholder, it shall take effect as a share certificate. Thus, even if the company prepared a document representing shareholders' rights and delivered it to a third party who is not a shareholder, the above document does not have the effect as a share certificate of the defendant company (see, e.g., Supreme Court Decision 76Da2755, Apr. 12, 197). Meanwhile, it is premised on the validity of share certificates acquired in order for the company to be recognized as a bona fide acquisition of share certificates. Thus, even if the company issued a document representing shareholders' rights and delivered it to a third party who is not a shareholder, the above document has no effect as a share certificate, and thus the third party cannot bona fide acquire share certificates

Therefore, as seen earlier, the fact that Defendant Sambu Development re-issued the share certificates representing the shares of this case on June 26, 2007 upon the Nonparty’s request for re-issuance of the share certificates based on the judgment of nullification of this case and granted them to Defendant Sambu Development. As such, since the share certificates re-issued were not issued to the Nonparty who was the shareholder of the shares of this case at the time of the re-issuance of the share certificates, it did not have a bona fide acquisition of the said re-issued share certificates. Therefore, the Defendant Sambu Development’s aforementioned assertion is without merit without any need to further examine.

(C) As to the assertion on the calculation of stock purchase price

Defendant Sambu Development asserts to the effect that even if the appraisal right of this case is recognized to the Plaintiff, it is agreed to allow the Plaintiff to claim purchase of this case within the limit of the issue price, so the above price or the purchase price of stocks determined by the court is excessive, and thus, it cannot be complied with the Plaintiff’s claim for purchase of this case.

According to the statement No. 3-1 of the certificate No. 3-1, the defendant Samsan Development and the non-party are acknowledged as having entered into the above agreement, but it cannot be deemed as having effective to the plaintiff who is the mortgagee. The court's decision on the purchase price of shares can only be asserted as an immediate appeal pursuant to Articles 86-2 (3) and 86 (4) of the Non-Contentious Case Litigation Procedure Act. The court's decision on the purchase price of shares in this case was made by the Jung-gu District Court at the case of the above request for the purchase price of shares, and the fact that the above decision became final and conclusive around that time is not appealed. Thus, the defendant Sam-gu Development cannot dispute the above decision on the purchase price of shares in this case. Thus, the above argument by the defendant Sam-gu Development is without merit.

B. Filing a claim against the Defendant’s compact system

(1) Determination as to the first selective claim

(A) The plaintiff's assertion

The non-party transferred the shares of this case, the only property of which is the property under the condition that he bears a total of KRW 3.3 billion loan obligation to a good mutual savings bank. Since the above share transfer contract constitutes a fraudulent act and is presumed to be the bad faith of the defendant's compact system, the above share transfer contract should be revoked, and the defendant compact system has the duty to deliver the said re-issued share certificates to the non-party due to the restitution of the original state following the revocation of the fraudulent act.

(B) Determination

In light of the fact that the issuance of share certificates is the effective requirement for share transfer, the defendant Comcom System cannot exercise the shares of this case as it failed to acquire the above re-issued share certificates effectively, and on the other hand, by exercising the appraisal right of this case, the plaintiff was liable for payment of the above purchase price to the plaintiff. Accordingly, the non-party's act of entering into the above share transfer contract with the defendant Comcom System does not constitute a fraudulent act causing the lack of common security in relation to the non-party's general creditors. Thus, the plaintiff's claim for this part is without merit.

(2) Determination as to the second selective claim

(A) The plaintiff's assertion

Since the Defendant’s Comcom System obtained a re-issuance of share certificates through the judgment of nullification of the instant case that is null and void and the procedure for the issuance of invalid share certificates, it is obligated to deliver the said re-issued share certificates to Defendant Sambu Development.

(B) Determination

On the other hand, there is no evidence to acknowledge that the Plaintiff had the right to seek to deliver the re-issued share certificates to the Defendant Sambu Development, and there is no reason to support this part of the Plaintiff’s assertion ( even if the Plaintiff’s claim against the Plaintiff was made by subrogation of the right to claim the payment of purchase price following the exercise of the instant appraisal right against Defendant Sambu Development as the preserved right, and by subrogation of the Defendant Sambu Development as the debtor, the Defendant Sambu Development as the preserved right to claim the delivery of the above re-issued share certificates, there is no evidence to prove that Defendant Sambu Development is currently insolvent, and there is no need to preserve the claim, as the Plaintiff could not exercise the shares of this case due to his failure to effectively acquire the above re-issued share certificates, there is no possibility that his responsible property might decrease even if he could not exercise the above rights by subrogation of the above rights).

3. Conclusion

Therefore, the plaintiff's claim for Defendant Sambu Development is justified within the scope of the above recognition, and the remainder of the claim for Defendant Sambu Development and the claim against Defendant Sambu system are dismissed as it is without merit. It is so decided as per Disposition.

[Attachment]

Judges Marain (Presiding Judge)