[1] Whether the other party may terminate the insurance contract in a case where the trust relationship is destroyed due to an unfair act by one of the parties, etc. during the existence of the insurance contract and there is a serious reason not to expect the existence of the contract (affirmative)

[2] In a case where it is found that the policyholder claimed insurance proceeds as a ground for payment of the medical treatment or received the payment of the whole or part of the hospital treatment, whether the insurer may terminate the insurance contract (affirmative with restriction) / Whether the insurer has a prior obligation to explain the above termination right to the insurer (negative), and whether the insurer’s exercise of the insurer’s right to termination can be deemed as a violation of Article 63 of the Commercial Act and Article 9 subparag. 2 of the Regulation of Standardized Contracts Act (negative) / Whether the exercise of the above termination right can be deemed as a violation of the principle of trust and good faith under the insurance contract solely on the ground that the insurer did not disclose that the insurer did not meet the payment requirements at the stage of examining the payment of the insurance proceeds

[1] Article 2 of the Civil Act, Article 638 of the Commercial Act / [2] Article 2 of the Civil Act, Articles 638, 638-3, and 663 of the Commercial Act, Article 9 subparagraph 2 of the Regulation of Standardized Contracts Act

MJ Insurance Co., Ltd. (Law Firm Apex, Attorneys Kim Yong-sik et al., Counsel for the plaintiff-appellant)

Defendant (Attorney Appointment-at-Law, Counsel for defendant)

Suwon District Court Decision 2019Na60080 decided December 5, 2019

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

The grounds of appeal are examined.

1. An insurance contract is a continuous contract that continues to exist during the insurance period as well as a moral hazard, and thus, has a strong fiduciary relationship between the parties, as it is highly required by the parties’ ethical and good faith. Therefore, when the fiduciary relationship, which forms the basis of the contract, is destroyed due to a party’s unfair act, etc. during the existence of the insurance contract, and the other party is unable to expect the existence of the contract due to a serious cause, the other party may terminate the contract to the future by terminating

In a case where the policyholder claimed or paid the insurance money for the cause of the payment of the hospitalized treatment, but it is found that the whole or part of the hospitalized treatment was not required, the insurer may terminate the insurance contract if, comprehensively taking into account such various circumstances as the circumstance leading up to receiving the hospitalized treatment, whether he was hospitalized knowing that there was no need for the hospitalized treatment, the number of days of hospitalization without the necessity of the hospitalized treatment, the amount of the insurance money, claims or receipt frequency of the insurance money, circumstances relating to other insurance contracts to which the policyholder was enrolled, or the manipulation of documents, etc., and if it is deemed that there is a serious reason for the policyholder to expect the continuation of the insurance contract as a result of the policyholder’s unreasonable claim or receipt of the insurance money, and the said

Meanwhile, such termination right is based on Article 2 of the Civil Act that provides for the principle of trust and good faith and is naturally premised on an insurance contract relationship. Thus, it cannot be deemed that the insurer has an obligation to explain in advance to the insurer, or the insurer’s exercise of such termination right violates Article 63 of the Commercial Act and Article 9 subparag. 2 of the Regulation of Standardized Contracts Act. The insurer’s exercise of such termination right solely on the ground that the insurer did not disclose that it failed to meet the payment requirements at the stage of examining the payment of the insurance proceeds and paid the insurance proceeds. However, such termination right is not a violation of trust and good faith under an insurance contract. However, it is not clear whether there is any ground for termination in a specific case and it is not clear whether the insurer has a reason for termination in a specific case, and it may be an excessive disadvantage to the policyholder. Considering the fact that the insurer’s refusal of unfair claim for insurance proceeds or the termination of the insurance contract itself beyond being refunded the insurance

2. Based on its stated reasoning, the lower court determined that the Plaintiff’s notice of termination of the instant insurance contract was lawful, on the premise that, even if not explicitly included in the content of the instant insurance contract that was concluded in accordance with the terms and conditions, it may constitute a ground for termination of the insurance contract under the principle of trust and good faith, on the grounds that, in light of the number of days with which unfair hospitalization accumulated, claims for the payment of insurance proceeds and subsequent amounts of insurance proceeds repeated, and the amount of the insurance proceeds, etc., the underlying trust relationship of the instant insurance contract was destroyed

3. Examining the record in accordance with the aforementioned legal doctrine, the lower court did not err in its judgment by exceeding the bounds of the principle of free evaluation of evidence against logical and empirical rules, or by misapprehending the legal doctrine on the grounds for termination, the scope of application of the principle of trust and good faith, the interpretation and duty of explanation

4. 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 on the bench.

Justices Min You-sook (Presiding Justice)