Whether other creditors can seek a payment of the proportional amount in proportion to the amount of the claim against the cancelled creditor as to the amount of compensation received directly by the creditor by exercising the right to revoke the fraudulent act (negative)

Since the revocation of fraudulent act and restitution are effective for the benefit of all creditors (Article 407 of the Civil Act). Therefore, the revocation of fraudulent act and restitution are effective for the benefit of all creditors (Article 407 of the Civil Act). Although the revocation creditor does not have preferential right to payment to the debtor with respect to the property recovered by the exercise of the creditor's right to revoke, other creditors are entitled to receive the proportionally distributed amount from the total amount of claims. However, this means that other creditors are entitled to receive the distributed amount from the debtor's responsible property recovered by the joint security of claims through legal procedures, such as the Civil Execution Act. It cannot be said that other creditors obtain the right to directly seek the distributed amount against the revocation creditor without such legal procedure, or that other creditors have the right to obtain the right to receive the distributed amount from the cancelled creditor, or that the obligation to distribute the transferred property or the equivalent amount is recognized.Although there is an unfair result caused by the revocation creditor's failure to bear such a distribution obligation, it is inevitable in the interpretation of the current provisions related to revocation.

Article 407 of the Civil Act

Plaintiff (Law Firm Sam Pung, Attorneys Kim Young-il et al., Counsel for the plaintiff-appellant)

Korea Federation of Small and Medium Business

Seoul High Court Decision 2006Na71474 decided May 18, 2007

The appeal is dismissed. The costs of appeal are assessed against the plaintiff.

The grounds of appeal are examined.

Since the revocation of fraudulent act and restitution are effective for all creditors' interest (Article 407 of the Civil Code), it is not effective for the creditor to have preferential payment right against the property restored to the debtor by the exercise of the creditor's right of revocation, but it is possible for other creditors to receive the distributed amount among the total amount of claims. However, this means that other creditors can receive the distributed amount from the debtor's responsible property recovered by the joint security of claims through legal procedures such as the Civil Execution Act. It cannot be said that other creditors obtain the right to directly seek the distributed amount against the cancelled creditor or bear the obligation to distribute the transferred property or the equivalent amount.Although there is an unfair result of the cancelled creditor receiving the preferential payment due to the non-performance of the obligation of distribution, it is inevitable to interpret the current provisions related to the cancellation of creditor's claim.

In light of the above legal principles, the court below is just in rejecting the plaintiff's claim for the payment of the proportional amount of the plaintiff's claim, which is another creditor and beneficiary, based on the judgment that the cancelled creditor who received the equivalent amount compensation has no obligation to distribute the equivalent amount to other creditors, and there is no error

Therefore, the appeal is 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 Kim Young-ran (Presiding Justice)