[1] In a case where the guarantor provided new funds to the respondent who has no means to repay the debt, or provided a security to borrow them, and had it used for the repayment of the debt already guaranteed, whether the risk of new damage may be deemed to have occurred (negative)

[2] The case affirming the judgment below which held that the defendants' representative director Gap corporation's debt obligations of Eul corporation, the guarantor Eul corporation, or provided blank bills as security; since the defendants provided Gap corporation's deposit as security at the time of borrowing funds from Byung mutual savings and finance companies, it cannot be deemed that the risk of causing new damage to Gap company's debt obligations of the above financial institution, which was guaranteed by Eul company, does not constitute a crime of occupational breach of trust, since it did not result in the risk of causing new damage separately from the debt guaranteed by king

[3] In a case where a director of a company lends a company fund to an affiliated company which has lost its ability to repay debts, or provides a payment guarantee in the company's name, knowing that the company's loss would occur to the company (affirmative)

[4] The case holding that the defendants, the representative director of Gap corporation, offered Gap corporation's deposit as security in order to enable Eul corporation to receive a loan even though they knew that Eul corporation, which is in a situation in which it is impossible to repay a large amount of debt with its own funds, did not use it for the repayment of existing debt, and it is unclear whether it is realizing profit, and that it constitutes a breach of trust against Gap corporation and its criminal intent is recognized

[1] Articles 355(2) and 356 of the Criminal Act / [2] Articles 355(2) and 356 of the Criminal Act / [3] Articles 355(2) and 356 of the Criminal Act / [4] Articles 355(2) and 356 of the Criminal Act

[1] Supreme Court Decision 2007Do541 Decided July 23, 2009 (Gong2009Ha, 1454) / [3] Supreme Court Decision 99Do1141 Decided June 25, 199 (Gong199Sang, 1556), Supreme Court Decision 2004Do5167 Decided November 10, 2006, Supreme Court Decision 2007Do3373 Decided September 7, 2007

Defendant 1 and one other

Prosecutor

Attorney Lee Jin-jin et al.

Seoul High Court Decision 2009No604 decided August 20, 2009

The judgment below is reversed and the case is remanded to Seoul High Court.

The grounds of appeal are examined.

1. As to the [Attachment 14, 16] Nos. 14, 16, and 15 of the lower judgment’s [Attachment 100 million won]

In the event that a guarantor has already guaranteed another person's obligation, as the principal is not sufficient to pay his/her obligation, which is likely to cause the guarantor to pay his/her guaranteed obligation, and the guarantor has provided new funds to the principal debtor or collateral for the principal debtor to borrow new funds, and the new funds have already been used for the repayment of the guaranteed obligation, the guarantor cannot be deemed to have incurred a risk of causing a new loss separate from the guaranteed obligation (see Supreme Court Decision 2007Do541, Jul. 23, 2009).

According to the reasoning of the judgment below, the court below acknowledged the facts as stated in its reasoning based on the adopted evidence, and determined that since the defendants, the representative director of the non-indicted 1 corporation, had already jointly and severally guaranteed the obligations of the non-indicted 2 corporation, the guarantor, or provided blank bills as security, provided the deposits of the non-indicted 1 corporation to the non-indicted 2 corporation as security and used new funds to repay the obligations to the financial institutions, such as the new capital capital guaranteed by the non-indicted 1 corporation, etc., it cannot be deemed that it caused a risk of causing new damages separately from the debt guaranteed by the former, and thus, the crime of occupational breach of trust is not established

In light of the above legal principles and records, we affirm the above judgment of the court below as just and there is no violation of law as otherwise alleged in the ground of appeal.

2. As to the [Attachment 15] Nos. 15 and 3.9 billion won among the [Attachment 15] of the lower judgment, and before the amendment of indictment [Attachment Ⅱ] No. 12

Each of the above parts was withdrawn in accordance with the amendment of the indictment at the court below, and accordingly, it is clear in the record that the court below did not make any decision thereon. Accordingly, this part of the ground of appeal is unlawful.

3. As to the [Attachment 7] Nos. 7 and 10 of the lower judgment

A. If a director of a company extended a company fund to another person or provided a payment guarantee under the name of another person with sufficient knowledge that it would cause damage to the company when the other person lends a fund or provided a payment guarantee for that person's debt, such lending of fund or payment guarantee is an act of causing profit to the other person and causing damage to the company, and the director of the company cannot be exempted from the liability for the crime of breach of trust just because it is a management judgment. This does not change because the other person is an affiliated company of the financial support company (see Supreme Court Decisions 9Do1141, Jun. 25, 199; 2007Do373, Sept. 7, 2007, etc.).

B. On January 30, 201, the lower court determined that Nonindicted Co. 1 offered 500 million won to Nonindicted Co. 2 as collateral in order to obtain a loan from Nonindicted Co. 1 to Nonindicted Co. 2 on January 30, 2001, Nonindicted Co. 2 offered a loan of KRW 1 billion from Nonindicted Co. 1 to Nonindicted Co. 2, May 15, 2001; Nonindicted Co. 3’s representative director of Nonindicted Co. 2, at the time of investing in venture businesses, realized considerable investment profits by investing in venture businesses; it is favorable for Nonindicted Co. 2 to make an additional investment in venture businesses; Nonindicted Co. 1, 200, it was difficult to view that Nonindicted Co. 2, who had been using Nonindicted Co. 1’s funds, as evidence for investment in new venture businesses, and that it was more favorable to Nonindicted Co. 1, 200, which had been using Nonindicted Co. 1’s assets as an investment partner of Nonindicted Co. 1, 2006.

C. However, the above determination by the court below is difficult to accept in light of the above legal principles.

First, according to the facts acknowledged by the court below, even if it is based on the facts acknowledged by the court below, it is difficult for the non-indicted 2 corporation to repay it to its own financial resources due to a large amount of debt, and even if it does not use the loan borrowed under the provision of security for the non-indicted 1 corporation in the repayment of the existing debt, it is unclear whether it is realizing profit, and used it for the stock investment that is likely to cause loss, and the defendants knowingly provided the deposit of the non-indicted 1 corporation as security. Thus, it is difficult to view the above acts of

Furthermore, the following circumstances acknowledged by the court below and the court of first instance as follows: (a) Nonindicted Co. 1 acquired 53.5 billion won of shares or non-guaranteed bonds for the purpose of providing funds to Nonindicted Co. 2; (b) the financial structure of Nonindicted Co. 2; (c) as of August 24, 1998, the amount of KRW 61.8 billion of assets as of March 3, 200; (d) the amount of KRW 73.1 billion of liabilities; and (e) the amount of KRW 80.6 billion of assets; and (e) the amount of KRW 41.2 billion of assets in March 2001; and (e) the amount of KRW 81.9 billion of liabilities; and (e) the amount of KRW 1.3 billion of assets in violation of the duty of management of Nonindicted Co. 2 Co. 300, Dec. 29, 2000; and (e) the amount of KRW 200,300,000.

D. Nevertheless, the court below determined that each of the above security acts is not a breach of duty, or that the Defendants did not have an intent to commit a breach of duty. The court below erred by misapprehending the legal principles on breach of duty, breach of duty, and criminal intent, which affected the conclusion of the judgment. On the other hand, this part of the judgment below is in the relation of a crime as a whole with the remainder of the facts charged, and thus, the judgment

4. Conclusion

Therefore, the judgment of the court below is reversed, and the case is remanded to the court below for a new trial and determination. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Shin Young-chul (Presiding Justice)