The case of denying indemnity against the transferee of the business who has repaid the debt of the transferor; and

In the event that Party A, while running an entertainment business, borrowed operating funds from Party B under the Plaintiff’s joint and several sureties, the Defendant continued to operate the entertainment business by acquiring the said entertainment business from Party A, and the Plaintiff partly repaid the above business loans as joint and several sureties A, the Plaintiff’s right to indemnity as a guarantor cannot be created since it did not guarantee the Plaintiff’s obligation to the Defendant, and at the time of the transfer, the Plaintiff’s claim for indemnity against the business transferor is not yet created. Therefore, it is difficult to deem that the Defendant’s business transferee succeeds to the status of the guarantor with respect to the business funds of the transferor, and it is difficult to view that the Defendant’s business transferee is not a transferor’s succession to the status of the guarantor

Article 441 of the Civil Act, Article 42 of the Commercial Act

[Defendant-Appellee] Plaintiff 1 et al., Counsel for defendant-appellee

Defendant-Appellee et al., Counsel for the defendant-appellant

Seoul High Court Decision 88Na27039 delivered on April 11, 1989

The part of the judgment of the court of first instance against the plaintiff shall be revoked, and the part of the judgment of the court of first instance ordering the defendant to pay gold 20 million won and interest interest thereon shall be reversed, and the case shall be remanded to the Seoul High

According to the reasoning of the judgment below, the court below found that the non-party 1 and the non-party 2, who were co-defendants of the court below, jointly run the entertainment business from Youngdong 4 to Youngdong 4, 1987, borrowed 50 million won for the business fund from the Joseon 1 under the plaintiff's joint and several sureties 4 May 4, 1987, and the defendant continued to take over the above two persons' entertainment business, use the trade name "New 1", and continue to operate the business. The court below recognized the fact that the plaintiff paid 40 million won out of the above business fund to the above two persons on June 23, 198 and June 29, 198 as joint and several sureties, and recognized that the defendant is liable to pay 20 million won for indemnity as sought by the plaintiff.

However, according to the facts acknowledged by the court below, since the Plaintiff did not guarantee the obligation to the Defendant, the right to indemnity (see Articles 441 and 442 of the Civil Act) cannot be created as a guarantor, and at the time of the Defendant’s transfer by transfer of the new entertainment establishment, the Plaintiff’s claim for indemnity against the transferor of the business was not yet created, and it is difficult to deem that the Defendant’s transfer by transfer of business succeeds to the status of the guarantor related to the transferor’s business funds (see Article 42(1) of the Commercial Act).

Therefore, the defendant does not have a legal basis for paying the indemnity amount to the plaintiff. The judgment below did not err by misapprehending the legal principles on the responsibility of the transferee of business and the legal principles on the right to indemnity of the joint guarantor, and there is a ground for appeal pointed out this point.

The judgment below is reversed, and the case is remanded to the Seoul High Court. It is so decided as per Disposition by the assent of all participating judges.

Justices Kim Yong-sung (Presiding Justice)