(a) Whether interruption of prescription recognized as an act of participation in company reorganization has also on the guaranteed obligation;

B. Whether the application of Article 440 of the Civil Code, which stipulates the effect of interruption of prescription as to the guarantor, is excluded on the ground that Article 240(2) of the Company Reorganization Act exists

A. Where company reorganization procedures have commenced for an enterprise which is the principal debtor, the participation in such procedures such as report of reorganization claims, etc., are real rights of reorganization creditors, and the interruption of prescription acknowledged for such participation, pursuant to Article 5 of the Company Reorganization Act, shall also affect the guaranteed obligation of the reorganization company whose principal obligation is its liabilities, and its effect shall remain in force as long as the exercise of rights

B. Article 240(2) of the Company Reorganization Act excludes the subsidiary nature of the guaranteed obligation by prescribing the purport that the principal obligation of the reorganization company does not affect the guaranteed obligation with respect to the effective scope of the company reorganization plan, but it is interpreted that the reorganization plan does not affect the guarantor by setting a difference between the reorganization company and the guarantor with respect to the validity of the reorganization plan. Meanwhile, Article 440 of the Civil Act, which provides for the effect of interruption of prescription as to the guarantor, is not a natural provision derived from the subsidiary nature of the guaranteed obligation, but a policy provision to prevent the extinction of the guaranteed obligation separately for the protection of the creditor, and thus, Article 440 of the Civil Act does not exclude the application

(a)Article 440 of the Civil Code, Section 5 of the Company Reorganization Act, Section 2 of Article 240;

A. Supreme Court Decision 87Meu2055 Decided February 23, 1988 (Gong1988, 588)

Attorney Kim J-jin, Counsel for the defendant-appellant

Defendant 1 and one other Defendants, Kim Dong-dong Law Office, Attorneys Kim In-ap et al., Counsel for the defendant-appellant-appellee)

Daegu High Court Decision 92Na10044 delivered on August 19, 1993

All appeals are dismissed.

The costs of appeal shall be assessed against the defendants.

We examine the grounds of appeal.

According to the reasoning of the judgment below, the court below rejected the Defendants’ defense that the Defendant’s guaranteed liability against the Plaintiff, which is the deceased Nonparty’s heir, a joint guarantor of the debt, was also extinguished upon the completion of the extinctive prescription of the claim for reimbursement against the Plaintiff, on the ground that the Plaintiff’s reorganization procedure for the said company, the principal debtor, commenced, reported the claim for reimbursement, and participated in the reorganization procedure, thereby suspending the extinctive prescription, and the effect of suspension extends to the guaranteed liability that exists until the completion of the reorganization procedure and is the principal obligation of

Where a company reorganization procedure has commenced for a company which is a principal debtor, the participation in the procedure such as a report of reorganization claim has the substance of the reorganization creditor's exercise as a right, and the interruption of prescription which is recognized as an act of participation under Article 5 of the Company Reorganization Act extends to the guaranteed obligation whose principal obligation is the reorganization company's obligation, and its effect is maintained as far as the exercise of the right to participate in the reorganization procedure continues (see Supreme Court Decision 87Meu2055, Feb. 23, 198). Article 240 (2) of the Company Reorganization Act excludes the subsidiary nature of the guaranteed obligation by stipulating that the principal obligation of the reorganization company with respect to the effective scope of the company reorganization plan does not affect the guarantor, but it is interpreted that the reorganization plan does not affect the guarantor, while Article 440 of the Civil Act, which provides that the effect of interruption of prescription as to the guarantor of the reorganization plan, has a different effect between the reorganization company and the guarantor, and it is a policy to prevent the extinction of prescription as well as the effect of creditor's protection.

Ultimately, the judgment of the court below based on the precedents of party members is just and it is not erroneous in the misapprehension of legal principles as to the validity of the interruption of prescription due to participation in reorganization proceedings. We cannot accept as an independent opinion.

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.

Justices Park Jong-ho (Presiding Justice)