In cases where a retired director upon expiration of his/her term of office or resignation was unable to retain the number of the members of a director stipulated in the law or the articles of incorporation due to his/her retirement, and thus maintains his/her rights and duties as a director until the appointment of the succeeding director, whether the initial date of the alteration registration period due to the retirement of the director (=the date of the appointment of the succeeding director) and whether it is permissible to separately

If a director, including a representative director, retires from office due to the expiration of his/her term of office or resignation, results in the failure of the representative director or the head (minimum number of persons or a specific number) of the director prescribed by the Act or the articles of incorporation, the retired director has the rights and duties as a director until the newly appointed director (Article 386(1) and Article 389(3) of the Commercial Act). In such cases, the two or three weeks period during which the director must register his/her retirement should be calculated not from the date of his/her retirement, but from the date of his/her retirement, not from the date of his/her retirement, as in general cases, and it is reasonable to deem that only the registration of retirement of the retired director cannot be separately applied before his/her resignation is held.

Articles 183, 317(2)8, 317(2)9, and (4), 386(1), 389(3), and 635(1)1 of the Commercial Act

Supreme Court Order 67Ma921 dated February 28, 1968 (No. 16-1, 125) (Change)

[Judgment of the court below]

Busan District Court Order 2003Ra36 dated August 10, 2004

The order of the court below is reversed, and the case is remanded to Busan District Court Panel Division.

1. The name, resident registration number, and address of a director of a corporation and the name, resident registration number, and representative director of a corporation shall be registered at the time of registration of incorporation and such change has occurred, within two weeks at the place of the principal office and within three weeks at the place of each branch office, respectively (Article 317(2)8, 9, and (4) and Article 183 of the Commercial Act). In cases where a director, including the representative director, retires due to the expiration of his/her term of office or resignation, the registration of change due to his/her retirement shall be, in principle, made within the aforementioned registration period from the date of his/her retirement, and if such period has elapsed, administrative fines shall be imposed on him/her on the ground that he/she neglected registration prescribed by the Commercial Act (Article 63

However, in a case where the retirement of a director, including a representative director, becomes impossible due to the expiration of the term of office or resignation of a representative director or a director prescribed by the law or the articles of incorporation, the retired director has the rights and duties as a director until the newly appointed director is appointed (Articles 386(1) and 389(3) of the Commercial Act). In such a case, the two or three weeks period during which the retirement registration of a director should be completed is not calculated from the date of his retirement as in general cases, but from the date of his retirement. It is reasonable to view that only the registration of retirement of a retired director may not be separately applied for before his resignation. Even if the term of office expires or resignation continues to meet the rights and duties of a director for the purpose of filling the temporary deficiency of the number of directors prescribed by the law or the articles of incorporation, the fact that the retired director still fails to comply with the purpose of the Commercial Act after his/her retirement registration system is still subject to a public announcement for the purpose of maintaining the right and duties of a director, notwithstanding the maintenance of his/her rights and duties.

In contrast, in the Supreme Court Order 67Ma921 Decided February 28, 1968, the opinion that the Supreme Court held that even if a director whose term of office expires still has the right and duty as a director until the expiration of his/her office pursuant to Articles 386 and 389 of the Commercial Act, the duty to register the change of his/her retirement pursuant to Article 317 of the Commercial Act shall not be affected within two weeks from the expiration date of his/her term of office shall be modified by this decision.

2. The court below maintained the first instance court's decision imposing a fine for negligence on the ground that the period of registration of change due to retirement under Article 317 of the Commercial Act was calculated from the date of retirement of the representative director, even though the re-appellant was unable to receive the number of the representative director as prescribed by the articles of incorporation after the expiration of his/her term of office, and the latter representative director has the right and duty until he/she takes office. The court below erred by misapprehending the legal principles on the starting date of the period of registration of retirement in cases where the status of the retired director is continuously maintained, which affected the conclusion of the judgment. The ground for reappeal pointing this out has merit

3. Therefore, the order of the court below is reversed, and the case is remanded to the court below. It is so decided as per Disposition by the assent of all participating Justices on the bench.

The final judgment of the Chief Justice of the Supreme Court (Presiding Justice) shall be delivered with the assent of all participating Justices Kim Yong-dam, who reviewed the appeal for the plaintiff's appeal.