In a case where the principal creditor bank under the Operating Convention of the Creditor Bank for Corporate Restructuring, etc. concluded by financial institutions has convened the autonomous council of creditor banks to resolve on the reorganization of claims, etc. against an enterprise subject to management and the creditor bank opposing such a creditor bank has a provision to recognize the right to purchase claims but it is deemed that it would approve the resolution if it is not exercised, whether the alteration of rights and the establishment of obligations under the resolution will affect the creditor bank

Article 105 of the Civil Act

Supreme Court Decision 2009Da41748 Decided July 28, 2011 (Gong2011Ha, 1729)

Korea Development Bank and five others (Law Firm, Kim & Lee LLC, Attorneys Cho Young-young et al., Counsel for the plaintiff-appellant)

Korea Technology Credit Guarantee Fund (Law Firm Rotex, Attorneys Cho Han-soo et al., Counsel for the defendant-appellant)

Seoul High Court Decision 2013Na2019623 decided August 20, 2014

All appeals are dismissed. The costs of appeal are assessed against the defendant.

The grounds of appeal are examined.

In cases where financial institutions enter into an agreement on the operation of the creditor banks' council for corporate restructuring, etc., and the principal creditor bank under the agreement calls for the autonomous council of creditor banks composed of the creditor banks of the relevant company in order to commence the joint management procedures, and makes a resolution on the readjustment of claims, such as the reduction of or exemption from interest, etc. with the consent of the creditor banks holding not less than 3/4 of the amount of claims in order to normalize the management of the relevant company, and where there is a provision to deem that the creditor banks would approve the relevant resolution if they do not exercise their rights, the effect of the alteration of rights, such as the readjustment of claims, etc. under the above resolution, and the creation of obligations, such as the apportionment of losses between the creditor banks, etc., is based on the aforesaid prior agreement and the resolution of the autonomous council, and thus, it affects the creditor banks participating

According to the reasoning of the judgment below, the court below determined, based on its reasoning, that the defendant's new funds were supported by the second autonomous council resolution in accordance with Article 22 (1) of the Operating Convention of the Creditor Bank Council which applies mutatis mutandis in the FTP Joint Operation Guidelines (hereinafter "FTP"), and that creditor banks, including the defendant, will share losses in proportion to each credit amount, and that creditor banks, participate in the second autonomous council resolution that recognizes the right to claim claims by the opposing creditor banks and exercised voting rights. As long as the above resolution was adopted, the effect of change of rights, such as the creditor banks' loss sharing, etc. pursuant to the above resolution shall naturally affect the defendant who participated in the resolution of the autonomous council and exercised voting rights. In addition, unless the defendant did not request the purchase of claims within seven days from the above resolution date, the second autonomous council's resolution in accordance with Article 22 (1) of the FTP Joint Operation Guidelines, which applies mutatis mutandis in the second autonomous council's guidelines, and rejected the defendant's new funds from the defendant's new funds and the same purpose as the defendant's new funds.

In light of the relevant legal principles and records, the above determination by the court below is just, and contrary to the allegations in the grounds of appeal, there were no errors by misapprehending the legal principles on the interpretation of the FTP Joint Operation Guidelines and the loss sharing agreement, or by violating the Korea Technology Credit Guarantee Fund Act

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

Justices Lee In-bok (Presiding Justice)