Criteria for determining whether the act of the joint and several sureties's disposal of property constitutes fraudulent act

Article 406(1) of the Civil Act

[Plaintiff-Appellant] Plaintiff 1 and 1 other (Law Firm Gyeong, Attorneys Park Jong-soo et al., Counsel for plaintiff-appellant)

Korea Credit Guarantee Fund (Law Firm Sejong, Attorneys Kim Han-chul et al., Counsel for the defendant-appellant)

Hyundai Housing Co., Ltd.

Daegu High Court Decision 2009Na6449 Decided January 8, 2010

The part of the lower judgment against the Defendant is reversed, and that part of the case is remanded to the Daegu High Court.

We examine the grounds of appeal.

1. According to the reasoning of the judgment of the court of first instance cited by the court below, since the non-party 1, a joint and several surety debtor with respect to the plaintiff's claim for indemnity, was found to have sold to the defendant the non-party 1, the only property of the non-party 2, 30-11, YYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYY.

2. However, it is difficult to accept such a determination by the lower court for the following reasons.

A. Whether a joint and several sureties had the intent to harm at the time of selling real estate shall be determined by the fact that the joint and several sureties knew that his/her property status is insufficient to secure the obligation for joint and several sureties to the creditor. Although the joint and several sureties should have known that his/her property status is insufficient to secure the obligation of the principal debtor, he/she may not recognize his/her intention. The debtor's act of selling real estate which is the only property of the principal debtor and changing it into money which is easy for the debtor to consume is presumed to be a fraudulent act against the creditor, barring special circumstances, and the debtor's intention is presumed to be intentional, and the purchaser bears the burden of proving that he/she is bona fide (see Supreme Court Decision 97Da5420, Apr. 14, 1998, etc.).

B. Examining the record in light of the above legal principles, even if Nonparty 1 and Nonparty 2 were to engage in the non-party 1's fraudulent act, it is difficult to determine whether the non-party 1's disposal of the apartment house constitutes the non-party 1's fraudulent act. From a legal point of view, it should be determined by the fact that the non-party 1's own property status is insufficient to secure joint and several liability obligations to the creditor. Thus, among the judgment of the court of first instance cited by the court below, it is reasonable to view that the non-party 1's disposal of the apartment house was not an element to determine whether the non-party 1's disposal of the apartment house was the non-party 1's own property or the non-party 2's disposal of the apartment house, and that the non-party 2's disposal of the apartment house was the non-party 0's disposal of the apartment house under the name of the non-party 1's own property and the non-party 0's disposal of the apartment house is the non-party 1's property.

C. Nevertheless, the court below held that the sale of the apartment of this case, which is the only property of the non-party 1, is merely a disposal of the real estate by the means of financing to continue the business, which is the husband of the non-party 2's financial situation. Thus, the non-party 1's intention of death is not recognized. In so determining, the court below erred by misapprehending the rules of evidence or misapprehending the legal principles on presumption of intention to commit suicide, and the plaintiff's assertion pointing this out is with merit.

3. Therefore, the part of the judgment of the court below against the defendant is reversed, and that part of 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 Lee Hong-hoon (Presiding Justice)