[1] Whether a seizure by a disposition on default constitutes a seizure by another creditor under Article 229(5) of the Civil Execution Act or a seizure by another creditor under Article 236(2) of the same Act (affirmative)

[2] In a case where a third party obligor responded to a claim for collection by a creditor subjected to a seizure and collection order, or deposits for execution under Article 248(1) of the Civil Execution Act in the civil execution procedure after the seizure and collection order under the Civil Execution Act competes with the seizure and collection order under the Civil Execution Act, whether the seizure under a disposition for arrears loses its effect by achieving the purpose of the seizure under a disposition for arrears (affirmative), and in this case, whether an execution creditor under a disposition for arrears may participate in the distribution procedure without a demand for distribution under Article 247

[1] A seizure by a disposition on default does not include a seizure under Article 248(1) of the Civil Execution Act, in which an execution deposit may be made only on the ground of its own, but it is effective to prohibit a garnishee from paying to a debtor and from disposing of and receiving a claim against a debtor, and thus, it constitutes a seizure by another creditor under Article 229(5) of the Civil Execution Act or a seizure by Article 236(2) of the Civil Execution Act, which requires a third party debtor to undergo a distribution procedure only through the exclusion of the exclusive satisfaction of the creditor subject to an attachment order in the civil execution procedure.

[2] If a third-party obligor complies with a creditor who has received a seizure and collection order in the civil execution procedure, or makes a deposit for execution under Article 248(1) of the Civil Execution Act after the seizure and collection order under the Civil Execution Act competes with the seizure and collection order under the Civil Execution Act, the seized claim becomes extinguished, and such effect is limited not only to the creditor who has received a seizure and collection order under the Civil Execution Act but also to the execution creditor under the disposition for arrears. Thus, the seizure under the disposition for arrears shall become null and void, along with the seizure and collection order under the Civil Execution Act.

Therefore, the status of the execution creditor under the disposition on default as well as the creditor subject to the seizure and collection order in the civil execution procedure is also converted to the status of the creditor entitled to receive dividends in the distribution procedure under the Civil Execution Act. Thus, even if the execution creditor under the disposition on default did not separately make a demand for distribution under Article 247 of the Civil Execution Act until the time when the report on the reason for deposit or the

[1] Articles 229(5), 236(2), and 248(1) of the Civil Execution Act; Articles 24 and 41(1) of the National Tax Collection Act; Article 25(1) of the Enforcement Rule of the National Tax Collection Act / [2] Articles 148, 236(2), 247, and 248(1) of the Civil Execution Act; Articles 24 and 41(1) of the National Tax Collection Act; Article 25(1) of the Enforcement Rule of the National Tax Collection Act

[1] Supreme Court Decision 2004Da20326 Decided April 12, 2007 (Gong2007Sang, 668) / [2] Supreme Court Decision 2013Da20774 Decided April 23, 2015 (Gong2015Sang, 727)

Han Savings Bank (Law Firm Barun, Attorneys Yoon-Gyeong et al., Counsel for the plaintiff-appellant)

Korea

Seoul High Court Decision 2012Na43685 decided March 15, 2013

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

The grounds of appeal are examined (to the extent of supplement in case of supplemental appellate briefs not timely filed).

1. Regarding ground of appeal No. 1

A. Under the current law, the procedure for disposition on default and civil execution are separate procedures, and there is no provision in the law regulating relations between two procedures, and thus one procedure cannot interfere with the other party’s procedure. As such, a seizure and a collection order may also be issued against a claim seized by a disposition on default pursuant to the Civil Execution Act. On the contrary, a seizure by a disposition on default may be conducted against a claim subject to a seizure and collection order under the Civil Execution Act.

As can be seen, in cases where seizure by means of a seizure and a collection order under the Civil Execution Act and a disposition for arrears competes with each other, the garnishee may, in civil execution procedures, claim the performance of the obligation to either of the creditors subject to a seizure and collection order, and any execution creditor by a disposition for arrears, in response to either of the creditors subject to a seizure and collection order under the Civil Execution Act and any of the execution creditors by a disposition for arrears, and may also be discharged from liability by making a deposit for execution under Article 248(1) of the Civil Execution Act (see Supreme Court Decisions 2007Da29591, Sept. 6, 2007; 2013Da60982, Jul. 9, 2015)

Meanwhile, a seizure by a disposition on default does not include a seizure under Article 248(1) of the Civil Execution Act, where the execution deposit can be made only on the ground of its own (see Supreme Court Decision 2004Da20326, Apr. 12, 2007). However, it is effective to prohibit a third debtor from paying to a debtor and from disposing of and receiving a claim against a debtor. Thus, it constitutes a seizure by another creditor under Article 229(5) of the Civil Execution Act or a seizure under Article 236(2) of the Civil Execution Act, where the creditor subject to an attachment order is excluded from the exclusive satisfaction of the creditor subject to an attachment order and undergo a distribution procedure.

However,

If a third-party obligor complies with a creditor who has received a seizure and collection order in the civil execution procedure, or deposits for execution pursuant to Article 248(1) of the Civil Execution Act, after the seizure and collection order under the Civil Execution Act and the seizure based on a disposition for arrears are concurrent, the seized claim becomes extinct. This effect is limited not only to the creditor who has received a seizure and collection order in the civil execution procedure but also to the execution creditor under a disposition for arrears. Therefore, the seizure under a disposition for arrears, along with a seizure and collection order under the Civil Execution Act, should be deemed null and void by accomplishing its purpose.

Therefore, the status of the execution creditor under a disposition on default as well as the creditor subject to a seizure and collection order in the civil execution procedure is also converted into the status of the creditor entitled to receive dividends in the distribution procedure under the Civil Execution Act. Thus, even if the execution creditor under a disposition on default did not separately make a demand for distribution under Article 247 of the Civil Execution Act until the time when the reason for deposit is reported or the collection is reported, he/she may participate in the distribution procedure (see Supreme Court Decision 2013Da20774, Apr. 23, 2015)

B. According to the reasoning of the judgment below, the court below acknowledged the fact that ○○○○○○○ Company, which is the third debtor, deposited the settlement money in accordance with Article 248(1) of the Civil Execution Act after combining the seizure and collection order, etc. under the Civil Execution Act with the Plaintiff’s seizure and collection order under the Civil Execution Act regarding the settlement money claim, and the seizure based on the Defendant’s disposition on default, and determined to the effect that the Defendant, the execution creditor, following the above execution deposit, was in the position

In light of the above legal principles and records, the above judgment of the court below is just, and contrary to the allegations in the grounds of appeal, there were no errors by misapprehending the legal principles as to the effect of the request for delivery

2. As to the grounds of appeal Nos. 2 and 3

According to the reasoning of the judgment below, the court below acknowledged the facts as stated in its reasoning, and determined that the part of the amount of KRW 788,194,410 out of the amount of the dividends against the defendant was lawful, on the ground that the amount exceeding KRW 788,194,410 out of the amount of the gross real estate tax notified from time to time in June 2007, which was the delinquent amount related to the seizure of this case, was extinguished by the appropriation after the seizure of this case, inasmuch as △△△△△△△△△△, including the instant settlement money claim, was subject to the disposition on default on the entire claim for delivery of trust property against the defendant ○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○ corporation.

In light of the records, the above determination by the court below is just, and contrary to what is alleged in the grounds of appeal, there were no errors by exceeding the bounds of the principle of free evaluation of evidence against logical and empirical rules, by misapprehending the legal principles as to the specification of seized claims or the calculation of dividend amount in seizure

3. Conclusion

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 Lee In-bok (Presiding Justice)