Method of exercising rights by creditors in cases where a bank has received a promissory note as security for payment of existing debts

If a promissory note has also been issued by the bank as a security for payment of existing debts, the creditor who has the duty to exercise his rights under a bill, such as collecting it first, unless otherwise stipulated by the parties, that the bank will discharge its existing obligations at the place of performance of obligations.

Article 75 of the Bills of Exchange

Plaintiff

Defendant 1 and three others

Gwangju District Court Decision 79Gahap110 decided)

The plaintiff's appeal is dismissed in entirety.

Expenses for appeal shall be borne by the plaintiff.

The judgment of the first instance shall be revoked.

Defendant 1, 2, and 3: (a) filed on February 12, 1979 with respect to the real estate listed in the separate sheet No. 1 with the Gwangju District Court Decision 2228, which was received on February 26, 1979; (b) the provisional registration of the right to claim the transfer registration of ownership based on the reservation for sale and purchase on January 26, 1979; (c) the procedure for the cancellation registration of the ownership transfer registration made on March 20, 1979 with the court No. 4914, which was received on March 20, 1979; and (d) the defendant 1 filed on March 3, 1979 with respect to each building listed in the separate sheet No. 3772, which was made on February 3, 1979 with respect to each of the buildings listed in the separate sheet No. 375, Feb. 3, 1979; and (d) the procedure for the registration of ownership transfer registration entered in the separate sheet No. 3(1) within 397. 4.37.

Defendant 4 ordered the Plaintiff to order each of the buildings listed in the attached Table 3 list.

Litigation Costs shall be assessed against the Defendants in both the first and second instances.

1. First, we examine the Plaintiff’s claims against Defendant 1, 2, and 3.

Between the Plaintiff and the Defendants, on January 26, 1979, enter into a sales contract with two parcels of land listed in [Attachment Nos. 1, 2], the buildings listed in [Attachment No. 3] and all of the machinery installed in the above real estate in [Attachment No. 3] and the above real estate in combination with KRW 78,00,000;

(1) The above Defendants, the buyer, paid 15,000,000 won to the Plaintiff, the seller, as the down payment on the day.

(2) At the same time, the Plaintiff paid KRW 20,000,000 for the first intermediate payment by February 28, 1979, and at the same time, cancelled the registration of the establishment of a neighboring mortgage and other rights established on the subject matter of sale, and made the registration of ownership transfer to the Defendants.

(3) The Defendants agreed to pay the remaining amount of KRW 20,000,000 for the second intermediate payment of KRW 23,000,000 until May 30, 1979 to the respective payment dates until June 30, 1979, and the Defendants paid the said down payment of KRW 15,00,000 to the Plaintiff, and as stated in the purport of the claim regarding the real estate (hereinafter the instant real estate), there is no dispute between the parties as to the facts for which each provisional registration and ownership transfer registration has been made in the name of the said Defendants, as stated in the purport of the claim.

On the other hand, at the same time as the above 0-1 registry No. 2, No. 10-1, No. 10-2, No. 12-1, No. 3-2, and No. 1-3 of the above 0-1, No. 97 were issued for the above 0-1, and the above 9-2 were issued for the above 0-1, No. 90-2, No. 97, No. 1, and the above-mentioned 0-1, No. 9, No. 2, and the above-mentioned 0-1, No. 97 were issued for the above 0-1, No. 97, No.

The Plaintiff’s legal representative asserted that the Defendants paid the first intermediate payment agreed upon by the Defendants by delivering one of the above banks at face value of KRW 20,000,000 to the Plaintiff. The above bank is not a substitute for the first intermediate payment, but it is merely a receipt of the first intermediate payment obligation confirmation certificate or the payment security, and the contract execution place is not a party’s office, and there is no reason for the Plaintiff to bear the obligation to collect the said intermediate payment at the point inside the Seoul Trust Bank, which is located far away from this point as the contract execution place was agreed with Nonparty 1’s office. Thus, on February 28, 1972, the contract payment date was concluded by the Plaintiff at the above attorney’s office, which is the contract execution place, the above first intermediate payment was not paid at face value of KRW 20,000,000, and the Defendants notified the above Defendants to pay the intermediate payment within three days, and the above Defendants did not have the same payment. Accordingly, the Plaintiff and the Defendants’ registration as the above cancellation of the contract should be legally cancelled.

However, if a promissory note is issued by a bank, it is reasonable to view that the existing bank has an obligation to exercise its rights on the promissory note, such as collecting the existing obligation first, notwithstanding the delivery of a promissory note, unless otherwise stipulated that the bank will discharge its existing obligation at the place of performance of obligation. Therefore, the cancellation of the contract on the ground that the creditor did not exercise its rights on the promissory note first and did not provide the existing obligation. Thus, the contract cannot be deemed lawful. In this case, the above agreement contains a statement that the place of performance of the contract is to be designated as the office of Nonparty 1, and the remaining two banks are to deliver the bill to the plaintiff only after the date of delivery by Nonparty 1, the custodian of the bill, and the first installment payment. Further, the bank bank as of February 28, 1979, which issued for the first installment payment, did not have any legal effect on the part of the plaintiff's claim for cancellation of the contract, and it cannot be viewed that there exists no special agreement for the above cancellation of the contract as the plaintiff's witness's right to the cancellation of the contract.

2. Next, we examine the Plaintiff’s claim against Defendant 4.

There is no dispute between the parties as to the facts that Defendant 4 occupies each building listed in the separate sheet No. 3. As of July 18, 1977, the plaintiff claims 70,000,000 won against the defendant as of July 18, 197, and the plaintiff and the defendant on the same day together with the above claim amount and interest rate of 2% per month from June 5, 1977 to September 5, 197. When the above payment period has expired, each real estate in the separate sheet and another lot of land and the building site and the building on the ground shall be paid in substitutes for the purpose of execution of the provisional registration of the right to claim ownership transfer transfer registration on July 18, 197, and the provisional registration of the right to claim ownership transfer registration is completed in the name of the plaintiff on May 25, 197, each of the above real estate registered in the separate sheet No. 608 of the previous Civil Code shall be effective for the purpose of ownership transfer registration.

However, it is recognized that the registration of ownership transfer has already been made from the plaintiff in the name of defendant 1 on the ground of sale and purchase of the building in the attached list, and there is no evidence to deem that the above registration is null and void, and in this case, the plaintiff cannot be said to have the right to obtain an explanation from the plaintiff, or to have the right to obtain an explanation from the defendant 4, who is the possessor of the above building. Therefore, the plaintiff's claim for an explanation is groundless.

3. Therefore, the plaintiff's claim of this case against the defendants is without merit, and it shall be dismissed in its entirety. The judgment of the court of first instance is just in conclusion with the party members, and all of the plaintiff's appeal is dismissed and the costs of appeal are assessed against the plaintiff. It is so decided as per Disposition

Judges Lee Lee-soo (Presiding Judge)