[1] Meaning of “Bilateral contract” under Article 103(1) of the former Company Reorganization Act, and purport of Article 208 subparag. 7 of the former Company Reorganization Act, where an administrator performs his/her obligations pursuant to Article 103(1) of the same Act, the other party’s right to claim as a priority claim

[2] In a case where: (a) the amount of unpaid membership fees of Company A operating a golf club, including Company B, was adjusted to be unpaid; and (b) the unpaid membership fees were registered as paid after the commencement of reorganization proceedings against Company A; (c) the case affirming the judgment below that the claim for refund of membership fees based on the membership fees of Company B, including Company B, constitutes a reorganization claim based on the cause before the commencement of reorganization proceedings against Company A

[1] Article 103 (1) of the former Company Reorganization Act (repealed by Article 2 of the Addenda to the Debtor Rehabilitation and Bankruptcy Act, Act No. 7428 of March 31, 2005), Article 208 subparagraph 7 of Article 208 (see current Article 179 subparagraph 7 of the Debtor Rehabilitation and Bankruptcy Act) / [2] Article 102 of the former Company Reorganization Act (repealed by Article 2 of the Addenda to the Debtor Rehabilitation and Bankruptcy Act, Act No. 7428 of March 31, 2005), Article 103 (1) of the former Company Reorganization Act (see current Article 119 (1) of the Debtor Rehabilitation and Bankruptcy Act), Article 208 subparagraph 7 of Article 179 of the current Debtor Rehabilitation and Bankruptcy Act (see current Article 179 subparagraph 7 of the Debtor Rehabilitation and Bankruptcy Act)

[1] Supreme Court Decision 92Da56865 delivered on January 11, 1994 (Gong1994Sang, 678) Supreme Court Decision 2005Da38263 Delivered on September 6, 2007 (Gong2007Ha, 1530)

Plaintiff 1 and two others (Law Firm Name, Attorneys Park Dong-sik et al., Counsel for the plaintiff-appellant)

Seoul High Court Decision 201Na1448 delivered on May 1, 201

Daejeon High Court Decision 2012Na363 decided January 16, 2013

All appeals are dismissed. The costs of appeal are assessed against the plaintiffs.

The grounds of appeal are examined.

1. As to the grounds of appeal Nos. 1 and 2

In the case of bilateral contracts not performed by both parties, the term "a bilateral contract" under Article 103 (1) of the former Company Reorganization Act (repealed by Act No. 7428 of March 31, 2005, Article 2 of the Addenda to the Debtor Rehabilitation and Bankruptcy Act (hereinafter "former Company Reorganization Act") that grants the administrator an option to perform or cancel the contract is a contract for which both parties are liable for an equal consideration relationship. It refers to a contract which originally assumes an obligation between themselves, and functions as a security in which both parties are formed, performed, and existing legal and economic relations between themselves. To apply the above provision, the whole or part of the contractual obligations in an equal consideration relationship shall not be performed. Where a custodian performs his/her obligation pursuant to Article 103 (1) of the former Company Reorganization Act ("the Addenda to the Debtor Rehabilitation and Bankruptcy Act") provides for a claim for the other party's contractual obligation, and where a custodian intends to request the other party's performance, the latter party's obligation is also fulfilled, thereby maintaining equity between the parties.

According to the reasoning of the judgment below, if the defendant's computerized membership fees of 124,99,00 won out of 125,00,000 won were paid in lump sum at the time of the first membership agreement, and the amount of 1,000 won remains unpaid, the court below decided that the defendant's membership fees of 1,000 won were paid in installments on August 12, 1999 after the commencement of reorganization proceedings against the defendant, and that the defendant's membership fees of 1,00 won were paid in installments on August 7, 202, 202. Article 11 provides that "If the period of membership fees of 125,00,000 won was paid in full or completed, the defendant's membership fees of 1,000 won were issued for each of the above 1,000 won, and that the defendant's membership fees of 2,000 won were issued for each of the above 9,000 days after the commencement of reorganization proceedings."

In light of the above legal principles, since the unpaid amount of KRW 1,00 is extremely part of the plaintiffs' membership fee of KRW 125,00,000,000, the plaintiffs cannot be deemed to have functioned as securing the other party's repayment of obligations, each of the membership agreements on the club membership of this case cannot be deemed to constitute an executory bilateral contract under Article 103 (1) of the former Company Reorganization Act. Meanwhile, according to the records, the court below's aforementioned determination is just, and contrary to what is alleged in the grounds of appeal, the court below did not err by exceeding the bounds of the principle of free evaluation of evidence against logical and empirical rules and by exceeding the bounds of the principle of free evaluation of evidence, or by violating the principle of private autonomy concerning the interpretation of the parties' intent, or by violating the principle of pleading.

2. Regarding ground of appeal No. 3

According to the reasoning of the judgment below, the court below determined that Article 245 (1) of the former Company Reorganization Act has the same effect as a final judgment on the change of the right to reorganization claim of the members of the club in this case, and Article 5 (7) of the former Company Reorganization Act provides that "in the case of a member who is a member of the club in this case and does not report it as a reorganization claim, it shall not be affected by any disadvantage other than the reported member, and shall follow the above 3 through 6 of the reported member," and that Article 245 (7) of the former Company Reorganization Act has the same effect as a final judgment on the change of the reorganization plan in this case, since Article 245 (1) of the former Company Reorganization Act provides that the decision on the change of the reorganization plan in this case becomes final and conclusive without an immediate appeal after the decision on the approval of the reorganization plan becomes final and conclusive, the change of reorganization plan in this case's list or security holder's list has the same effect as that of the reorganization creditor, new company, security holder, and stockholder and security holder.

In light of the relevant legal principles and records, such determination by the court below is just, and contrary to the allegations in the grounds of appeal, there is no error of law by misapprehending the legal principles as to the subjective scope of the reorganization creditor list.

3. Conclusion

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 on the bench.

Justices Kim Yong-deok (Presiding Justice)