[1] Whether Article 22 of the Asset-Backed Securitization Act, which limits the business of a special purpose company to certain acts in accordance with an asset-backed securitization plan, is a mandatory provision that limits the rights ability of a special purpose company

[2] The validity of an act in violation of the provisions of Articles 10 and 23 of the Asset-Backed Securitization Act, which restricts the representative’s external right to conduct business (negative)

[3] The case holding that the act of the representative of a special purpose company establishing a pledge on the claims directly registered as securitized assets without going through the procedure stipulated in the Asset-Backed Securitization Act and the asset-backed securitization plan is null and void as it goes beyond the legal capacity of a special purpose company in violation of Article 22 of the Asset-Backed Securitization Act, as well as violates the limitation

[1] The purport of the Asset-Backed Securitization Act that limits the business affairs of a special purpose company as certain acts pursuant to the asset-backed securitization plan is to prevent a special purpose company from performing business affairs other than the business affairs related to the establishment of the special purpose company in accordance with the asset-backed securitization plan reasonably and reasonably, consistent with the purpose of the establishment of the special purpose company. This is because it is necessary to prevent the special purpose company from performing business affairs other than the normal asset-backed securitization-related business affairs, and from causing unexpected risks to investors who invested in the asset-backed securities. In light of the legislative purpose of the Asset-Backed Securitization Act and other provisions, Article 22 of the Asset-Backed Securitization Act, which limits

[2] In light of the legislative purpose of the Asset-Backed Securitization Act and Articles 10 and 23 of the same Act, unlike the company under the Commercial Act, the act of violating the restriction on the power of representation of directors under the Asset-Backed Securitization Act is null and void in principle regardless of whether the other party knew or could have known of the violation, unlike the case where the representative of the company under the Commercial Act did not go through internal procedures such as a resolution of the board of directors.

[3] The case holding that the act of the representative of a special purpose company establishing a pledge on the claims directly registered as securitized assets without going through the procedure stipulated in the Asset-Backed Securitization Act and the asset-backed securitization plan is null and void as it goes beyond the legal capacity of a special purpose company in violation of Article 22 of the Asset-Backed Securitization Act as well as violates the restriction on the

[1] Articles 1, 3, 6, 8, 9(1), 10, 19(2), 20, 21, 22, 23, and 40 subparag. 2 of the Asset-Backed Securitization Act, Article 34 of the Civil Act / [2] Articles 1, 10, 19(2), 22, and 23 of the Asset-Backed Securitization Act / [3] Articles 1, 10, 19(2), 19(2), 19(2), 20, 22, and 23 of the Asset-Backed Securitization Act, Article 34 of the Civil Act

Global First First Class Limited Company (Law Firm Sejong, Attorneys Choi Ho-ho et al., Counsel for the defendant-appellant)

Defendant 1 and six others (Law Firm Dadam, Attorneys Kang Chang-tae et al., Counsel for the defendant-appellant)

August 12, 2008

1. On December 14, 2007, the non-party 1 corporation confirmed that the right to claim the payment of the deposit amount of KRW 882,363,752 deposited by the Incheon District Court No. 10397 on 2007 was the Plaintiff.

2. The costs of lawsuit are assessed against the Defendants.

The same shall apply to the order.

1. Basic facts

A. On November 16, 200, Nonparty 1 Co., Ltd. completed the registration of ownership transfer with respect to the land for a factory site of 20,582.1 square meters and each building of 4,6, and 13 above ground (hereinafter “instant real estate”). On November 21, 2000, Nonparty 1 Co., Ltd. (hereinafter “I Bank”) and 13 other financial institutions including Han Bank Co., Ltd. (hereinafter “I Bank”) completed the registration of ownership transfer with respect to the instant real estate.

B. On October 28, 2004, Nonparty AFC Co., Ltd. (hereinafter “BC”) entered into a contract on the acquisition of collateral security claims held by one bank against Nonparty A Co., Ltd., and the Plaintiff entered into a contract on December 15, 2004 with one bank to obtain the status of purchaser under the contract on the purchase of collateral security claims by one bank.

C. Under the above contract, on January 7, 2005, Han Bank completed a supplementary registration prior to the right to collateral security (hereinafter “instant right to collateral security”) on December 15, 2004 with respect to its shares among the right to collateral security (hereinafter “mortgage”) on the Plaintiff on December 7, 2005.

D. On June 7, 2007, the Defendants entered into a pledge agreement with the Plaintiff on the instant collateral security claims (hereinafter “instant pledge agreement”) and completed the additional registration on June 7, 2007 regarding the instant collateral security agreement based on the instant pledge agreement.

E. On December 14, 2007, the non-party 1 corporation designated the deposited person as the Plaintiff or the Defendants by the Incheon District Court (Seoul District Court Decision 10397, Nov. 12, 2007) and deposited KRW 882,363,752 with respect to the instant secured mortgage claim in accordance with the company reorganization plan approved by the Incheon District Court on Nov. 12, 2007 (hereinafter “instant deposit”), and requested the Plaintiff to cancel the instant secured mortgage.

[Evidence] Facts without dispute, Gap evidence 1, 2, 3-1 to 10, 14, and 15, and the purport of the whole pleadings

2. The parties' assertion

A. The plaintiff's assertion

(1) According to the Asset-Backed Securitization Act as a special purpose company established pursuant to the Asset-Backed Securitization Act (hereinafter “Asset-Backed Securitization Act”), the Plaintiff limited the Plaintiff’s ability to dispose of the securitization assets only in accordance with the asset-backed securitization plan. The instant pledge is null and void since Nonparty 3, a director of the Plaintiff, took out a loan with ambiguous purposes, which is not an asset-backed securitization plan from the Defendants, and was established by Nonparty 3

(2) In addition, the Asset-Backed Securitization Act provides that the Plaintiff’s asset management business shall be entrusted to the caretaker and conducted under the supervision of the business trustee. This is a mandatory provision in light of the legislative purpose of the Asset-Backed Securitization Act. The instant pledge agreement concluded with the Plaintiff’s director Nonparty 3 without complying with such procedure is null and void.

(3) Even if the provisions of the Act on Asset-Backed Securitization are voluntary provisions, the Defendants knew or could have known that the pledge contract of this case was made without complying with it, and thus the pledge contract of this case is null and void.

(4) In addition, this case’s pledge agreement is null and void in that there is no secured debt, and Nonparty 3 establishes a forged employee identification system of the Plaintiff.

(5) As a result of the Defendants’ additional registration of the pledge on the instant right to collateral security, Nonparty 1 Co., Ltd. deposited KRW 882,363,752 with the deposited person as the Plaintiff or the Defendants regarding the secured obligation of the instant right to collateral security. The Plaintiff has a benefit to seek confirmation against the Defendants that the instant pledge agreement has been null and void, and thus, the Plaintiff has the right to claim payment of the instant deposit against the Defendants.

B. The defendants' assertion

(1) The Asset-backed Securitization Act permits temporary borrowing of money pursuant to an asset-backed securitization plan. The Defendants, a legitimate representative of the Plaintiff, requested to lend the redemption fund of KRW 42 billion to the Plaintiff on June 5, 2007, pursuant to the asset-backed securitization plan by Nonparty 3, which arrives at June 22, 2007, to lend the redemption fund of KRW 42 billion to the Plaintiff on June 5, 2007, KRW 15 billion, KRW 330 million, KRW 420 million, KRW 60, and KRW 700 million to the Plaintiff on June 5, 2007. On the same day, Nonparty 3, a legitimate representative of the Plaintiff, transferred to the Plaintiff’s Bank account through Nonparty 3’s National Bank account to secure the loan claims. The instant pledge was established to secure the loan claims.

(2) Nonparty 3 had a prior consultation with Nonparty 4 Co., Ltd., the caretaker on the above loan agreement and the instant pledge agreement. The instant pledge agreement is valid to the effect that the Plaintiff entered into a lawful procedure within the scope of its legal capacity.

(3) In addition, the Plaintiff’s assertion that this case’s pledge contract is null and void after borrowing KRW 70 million from the Defendants and repaying asset-backed securities may not be deemed to violate the principle of gold speech and good faith and the principle of good faith.

3. Determination

(a) Provisions of the Asset-Backed Securitization Act;

Article 22 of the former Asset-backed Securitization Act (amended by Act No. 8635, Aug. 3, 2007; hereinafter the same) which was in force at the time of the conclusion of the instant pledge agreement provides that the business of a special purpose company shall be limited to the business incidental to ① takeover or transfer of securitization assets, or entrustment of the business of a special purpose company to another trust company, ② issue, operation, and disposal of securitization assets, ③ issuance and redemption of securitized assets, ④ conclusion of contracts necessary for the implementation of an asset-backed securitization plan, ⑤ temporary borrowing of funds necessary for redemption, etc. of asset-backed securities, ⑤ investment of surplus funds, and ④ investment of surplus funds, and other business referred to in subparagraphs 1 through 6, and Article 20(1) provides that a special purpose company is prohibited from engaging in

In addition, Article 20 (2) of the Asset-Backed Securitization Act provides that a special purpose company shall not establish any business office other than the head office and shall not hire employees, and Article 10 provides that a special purpose company, etc. shall entrust the management of securitization assets to an asset manager meeting certain requirements pursuant to the Asset Management Entrustment Contract. Article 23 provides that a special purpose company, etc. shall entrust the management of securitization assets to an asset manager pursuant to the Asset Management Entrustment Contract.

(b) Effect of violation of Article 22 of the Asset-Backed Securitization Act;

In accordance with the provisions of law, a juristic person becomes the subject of rights and obligations within the scope of the purpose stipulated by the articles of incorporation (Article 34 of the Civil Act). Since the same applies to a profit-making juristic person, the legal capacity of a juristic person is limited by law that provides the basis for the establishment of a juristic person and the purpose of the articles of incorporation of a juristic person. Therefore, it is reasonable to view that the legal provisions that restrict

If Article 22 of the Asset-Backed Securitization Act, which limits the business of a special purpose company to certain acts in accordance with the asset-backed securitization plan, is interpreted as a limitation provision for the corporation's ability to enjoy rights, it shall be invalid as an act outside the ability to enjoy rights, and it shall be viewed as a mandatory provision that limits the rights of a special purpose company.

(4) The legislative purpose of the Asset-backed securitization Act is to contribute to the sound development of the national economy by establishing a system of asset-backed securitization in order to enhance the soundness of the financial structure of financial institutions and general companies by facilitating their financing activities, and by protecting investors who invest in asset-backed securities through stable supply of long-term housing funds (Article 1). It is because it is necessary to prevent the occurrence of risks unforeseeable to the investors in accordance with the asset-backed securitization plan by providing that the Asset-backed Securitization Act limits the business of a special purpose company to certain acts in accordance with the asset-backed securitization plan, including rational and normal asset-backed securitization in accordance with the purpose of establishment of the asset-backed securitization plan, to ensure that no change in the asset-backed securitization plan can be easily adopted by the Financial Services Commission or to ensure that the asset-backed securitization plan is carried out by the Financial Services Commission, including the scope of asset-backed securitization assets, types of asset-backed assets, and methods of asset-backed securitization (Article 4 subparagraph 7 of the Asset-backed Securitization Act).

(c) Effect of a violation of regulations on delegation of a special purpose company;

Articles 10 and 23 of the Asset-Backed Securitization Act restrict the general authority of the representative of a special purpose company to perform his/her duties externally recognized under the Commercial Act.

On the other hand, the legislative purpose of the Asset-Backed Securitization Act as mentioned above and the provisions of the Asset-Backed Securitization Act are not directly done by directors, unlike the company under the Commercial Act, but are enforced in the form of compulsory provisions to be done through asset managers and business trustees in principle. ② The Asset-Backed Securitization Act is null and void under the Commercial Act in cases where the representative act of directors, who are the subordinate executing agencies, is contrary to the asset-backed securitization plan or damages the rights of the person holding asset-backed securities, and it seems that there is no room to acknowledge its validity even in cases where the representative act is contrary to the asset-backed securitization plan or harms the rights of the person holding asset-backed securities. ③ In addition, in cases where the authority of the representative concerning external transactions of a corporation is restricted by the special law, such restriction of the representative authority differs from the restriction of the representative authority by articles of incorporation, etc. which is not easy to be perceived from the outside, and it is not necessary to protect the site of laws and regulations. In addition, the above act of violating the regulations on the restriction of representative authority in the Asset-Backed Securitization Act differs from the internal procedure.

D. Validity of the pledge agreement of this case

With respect to this case, if the purport of the entire pleadings is added to the statement in evidence Nos. 4 through 8, and evidence No. 1, the Plaintiff: ① Company established to conduct business under an asset-backed securitization plan registered with the Financial Supervisory Commission in accordance with the Asset-backed Securitization Act; ② the Plaintiff entered into an asset management entrustment agreement with the company on December 8, 2004; ③ the Plaintiff’s business trustee registered with the Financial Supervisory Service under the Asset-backed Securitization Act and the Plaintiff’s articles of incorporation, respectively; ③ the Plaintiff’s business trustee is entitled to temporarily borrow funds under the name of the truster pursuant to Article 16, on behalf of the truster pursuant to the asset-backed securitization agreement. However, according to the asset-backed securitization plan established with the Financial Supervisory Service, the terms and conditions of the loan are clearly stated as “financial institution”; ④ The asset-backed securitization company’s disposal of the above asset-backed assets without the Plaintiff’s prior consent in writing, which is the asset-backed assets administrator’s right to use the asset-backed assets, are stated as invalid.

E. Determination as to the defendants' assertion

(1) The Defendants asserted that, in order to raise the repayment fund of asset-backed securities, the Plaintiff borrowed funds from the Defendants and set up a pledge against the Defendants as a collateral, and that the Plaintiff’s director Nonparty 3 had sufficiently consulted with Nonparty 4 Co., Ltd. in advance, so the pledge agreement of this case is valid.

In addition to the purport of the oral argument, the defendants transferred KRW 500 million from June 5, 2007 to the national bank account of Nonparty 3 from around 11:00 to around 14:20. On the same day, the amount of KRW 400 million was transferred to the plaintiff's Bank account (Account Number omitted) in the name of "Edian○○○○○○○" on the same day. On the same day, around 14:04 and 14:07, each KRW 100 million was deposited into the plaintiff's account of "Edian○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○.

(2) The Defendants also asserted that the Plaintiff’s assertion that the pledge agreement of this case is null and void is not permissible in violation of the principle of notions and the principle of trust and good faith.

However, if a person who violated the mandatory law voluntarily asserts the invalidity of his/her agreement on the ground that it is an exercise of the right in violation of the principle of good faith, this would result in realizing the outcome of excluding the contract under the mandatory law, and the legislative intent is entirely grounded, barring any special circumstances, such assertion cannot be deemed as contrary to the principle of good faith, and in order to deny the exercise of the right on the ground that it violates the principle of good faith, there should be a good faith provided to the other party or that the other party has good faith from an objective point of view. The exercise of the right against the other party's faith should be in a state that is not acceptable in light of the concept of justice. 4) In this case where the Plaintiff disposed of the Plaintiff's representative in violation of the provision of restriction on power of representation, asset-backed securitization Act, and asset-backed securitization plan, which can easily be confirmed by the Plaintiff's representative, in violation of the Plaintiff's ability to exercise his/her right, and there is no special reason to acknowledge the validity of the pledge contract of this case against the Defendants.

F. Sub-committee

Therefore, since a pledge agreement on the instant mortgage claim is null and void, the right to claim the payment of the instant deposit following the repayment deposit on the instant mortgage claim is against the Plaintiff, and as long as the Defendants are dissatisfied with this, there is a benefit of confirmation.

4. Conclusion

Therefore, the plaintiff's claim of this case shall be accepted on the grounds of its reasoning, and it is so decided as per Disposition.

Judges Choi Jin-soo (Presiding Judge)

Note 1) Supreme Court Decision 2005Da480 Decided May 27, 2005 et al.

Note 2) Htp:/dart. fs.or.k

Note 3) Supreme Court Decision 71Da476 Decided April 20, 1971 and Supreme Court en banc Decision 85Meu122 Decided November 26, 1985, etc.

Supreme Court Decision 2003Da1601 Delivered on June 11, 2004