[1] In a case where a collection obligee has reached a judicial compromise between the garnishee and the garnishee, stating that “the part of the claims against which the collection obligee has made a payment of some amount of the claims against the seizure, and waives the remainder of the claims,” whether the part of the waiver of the claim against the collection obligee should be deemed to mean that the collection obligee would terminate the lawsuit without exercising the collection right against the garnishee (affirmative), and whether the effect of the above judicial compromise affects other creditors who exercise the collection right based on a separate collection

[2] In a case where multiple creditors received a seizure and collection order against the same claim, whether res judicata effect of the final and conclusive judgment in a collection payment lawsuit filed by either of the creditors extends to other collection creditors who received a seizure and collection order prior to the date of closing argument (negative)

[1] If a seizure and collection order has been issued against a monetary claim, the creditor shall obtain the right to directly collect the seized claim without subrogation pursuant to Article 229(2) of the Civil Execution Act. The creditor may waive his/her right to collect (Article 240(1) of the Civil Execution Act), but in such a case, there is no influence on the execution claim or the seized claim. Meanwhile, the collection creditor may not perform any act beyond the collection purpose, for example, the exemption, waiver, delay of the seized claim, assignment of claims, etc.

In a lawsuit for collection, where the collection obligee and the garnishee have reached a judicial compromise with the content that “the payment of some amount of the claims subject to seizure and waives the remainder of the claims,” the phrase “the part of waiver of the claim for payment” means that the collection obligee is related to his/her own right to collection that the collection obligee can lawfully waive and terminate the lawsuit with the third obligor without exercising the right to collect. In other words, even if the collection obligee used the expression that the remainder of claims would be renounced, it cannot be deemed to have waived the obligation itself without the right to dispose of. Therefore, the effect of judicial compromise as above does not extend to the other obligee who exercises the right to collect based on a separate collection order.

[2] Where multiple obligees have received a seizure and collection order against the same claim, the res judicata of the final judgment in the collection deposit lawsuit filed by a certain obligee does not extend to the other collection creditors who received the seizure and collection order prior to the date of closing of argument in the lawsuit. The reasons are as follows.

(1) The subjective scope of res judicata effect of a final and conclusive judgment is, in principle, limited to a person other than the parties, successors subsequent to a closure of pleadings, or persons who possess the object of claims on behalf of them, in cases where a plaintiff or a person who became a defendant obtains a final and conclusive judgment on behalf of others (Article 218(1) and (3) of the Civil Procedure Act), and does not extend to other third parties, except as otherwise provided for in Acts, such as a litigation on personal relations or a company-related litigation. Therefore, even if the subject matter of a collection claim filed by a collection creditor is the existence of a claim subject to attachment against a third debtor against a debtor, the res judicata effect of such final and conclusive judgment cannot be said

② Article 249(3) and (4) of the Civil Execution Act provides that a garnishee, who has filed a lawsuit in a lawsuit for collection, may apply to a creditor with an executory exemplification as co-litigants, by the first date for pleading, to order him/her to participate in the lawsuit on the side of the plaintiff. The said provision also provides that even if an obligee ordered to participate in the lawsuit does not participate in the lawsuit, the judgment on the lawsuit shall have an effect on the lawsuit. The said provision provides that a creditor who did not receive an order for participation may extend the scope of the judgment’s effect through an order for participation

(3) A garnishee may avoid continuing to bring an action against himself/herself by making an application for intervention order to another execution creditor, or making a repayment or deposit for the part in which he/she has lost, in a lawsuit for collection. Therefore, even though a judgment that became final and conclusive in a lawsuit for collection money raised by a certain creditor does not extend to any other creditor, it shall not be improper for a garnishee.

The final and conclusive decision of recommending compromise has the same effect as a judicial compromise (Article 231 of the Civil Procedure Act). The legal doctrine as to the final and conclusive judgment of a debt collection lawsuit is likewise applicable to cases where a decision of recommending compromise has become final and conclusive in a debt collection lawsuit filed by a creditor against a third debtor. Therefore, even if a decision of recommending compromise is final and conclusive in a debt collection lawsuit instituted by a creditor, the res judicata effect of a decision of recommending compromise does not extend to the other debt collection creditors

[1] Articles 229(2), 238, and 240(1) of the Civil Execution Act; Article 220 of the Civil Procedure Act / [2] Articles 218(1) and (3), and 231 of the Civil Procedure Act; Article 249(3) and (4) of the Civil Execution Act

[2] Supreme Court Decision 2010Da58889 Decided December 23, 2010 (Gong2011Sang, 222)

Plaintiff (Attorney Seo-he et al., Counsel for the plaintiff-appellant)

Defendant 1 and one other (Law Firm Lee, Attorneys Yang Yang-soo, Counsel for the defendant-appellant)

Seoul Central District Court Decision 2016Na14804 Decided July 20, 2016

The judgment below is reversed, and the case is remanded to the Seoul Central District Court.

The grounds of appeal are examined.

1. Facts and issues

A. According to the reasoning of the lower judgment, the following facts are revealed.

(1) On March 19, 2012, the Plaintiff received a claim seizure and collection order against the Defendants and the non-party 1’s claim amounting to KRW 183,309,000 (Seoul Southern District Court No. 2012TJ 201, 4914; hereinafter “instant claim seizure and collection order”), and around that time, the said decision was served on the Defendants.

(2) On June 22, 2012, Nonparty 1 filed a lawsuit against the Defendants seeking payment of KRW 559,219,358 (Seoul Central District Court 2012Gahap524777) on the ground of friendship or withdrawal from the business (Seoul Central District Court 2012Gahap52477). On June 21, 2013, the above court rendered a final and conclusive judgment that “The share value to be refunded by the Defendants following Nonparty 1’s withdrawal from the business of Nonparty 1 is KRW 9,806,683, and Nonparty 1 lost the standing as a party to the performance lawsuit within the scope of KRW 183,309,00, which is the claim subject to the attachment and collection order of Nonparty 1’s claim for the payment of KRW 183,309,000 among the lawsuit against Nonparty 1, and the remainder of Nonparty 1’s claim for delay was dismissed.”

(3) On May 22, 2014, Nonparty 2, the mother father of Nonparty 1, issued a seizure and collection order (Seoul District Court 2014TTTB 8869; hereinafter “the second seizure and collection order”) with respect to the claims to be returned due to Nonparty 1’s letter of credit against the Defendants or withdrawal from the company, with the amount of KRW 1,896,000,000, and around that time, Nonparty 2, the original copy of the decision was served on the Defendants.

(4) On March 4, 2015, Nonparty 2 filed a lawsuit claiming the amount of money (Seoul Central District Court Decision 2015Da38536, Jul. 24, 2015; hereinafter “pre-payment lawsuit”) against the Defendants on the basis of the order of seizure and collection of the second claim, “The Defendants jointly pay KRW 9,806,683 and delay damages therefor,” based on the order of seizure and collection. The Defendants deposited KRW 90 million with Nonparty 2 until July 31, 2015, in accordance with the above Reconciliation recommendation decision. The Defendants deposited KRW 90,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000).

(5) On July 14, 2015, the Plaintiff filed a lawsuit against the Defendants for the instant claim for the collection amount based on the seizure and collection order of the claim on July 14, 2015. The Plaintiff asserted that the Plaintiff should pay the remainder of KRW 9806,683 to the Plaintiff, as the Defendants deposited only KRW 99,80,683 as the Plaintiff deposited only KRW 90,000.

B. The main issue of the instant case is whether the ruling of recommending reconciliation, which waives part of the claim in the claim for collection, affects other collection creditors who had received a seizure and collection order before the ruling of recommending reconciliation becomes final and conclusive.

2. Where a decision to recommend compromise has become final and conclusive with the contents of waiver of part of the claim in a collection deposit lawsuit, whether the decision to recommend compromise affects the other collection creditors who received the seizure and collection order before such decision becomes effective

A. If a collection order is issued with respect to a monetary claim, the obligee obtains the power to directly collect the seized claim without subrogation pursuant to Article 229(2) of the Civil Execution Act. The obligee may waive his/her right to collect (Article 240(1) of the Civil Execution Act), but, in such case, there is no influence on the execution claim or the seized claim. Meanwhile, the collection obligee may not perform any act beyond the collection purpose, for example, the exemption, renunciation, delay of the time limit, assignment of claims, etc.

In a lawsuit for collection, where the collection obligee and the garnishee have reached a judicial compromise with the content that “the payment of some amount of the claims subject to seizure and waives the remainder of the claims,” the phrase “the part of waiver of the claim for payment” means that the collection obligee is related to his/her own right to collection that the collection obligee can lawfully waive and terminate the lawsuit with the third obligor without exercising the right to collect. In other words, even if the collection obligee used the expression that the remainder of claims would be renounced, it cannot be deemed to have waived the obligation itself without the right to dispose of. Therefore, the effect of judicial compromise as above does not extend to the other obligee who exercises the right to collect based on a separate collection order.

B. Where multiple obligees have received a seizure and collection order for the same claim, res judicata of the final and conclusive judgment in the collection claim filed by a certain obligee does not extend to the other collection creditors who received the seizure and collection order prior to the date of closing of argument in the lawsuit. The reasons are as follows.

(1) The subjective scope of res judicata effect of a final and conclusive judgment is, in principle, limited to a person who has become a party, successor subsequent to the closure of pleadings, or a person who has held the subject matter of a claim on behalf of the party or the person who has become a plaintiff on behalf of the party or the defendant, except as otherwise provided in law, such as a litigation in relation to personal relations or a company-related litigation, and does not extend to other third parties (see Supreme Court Decision 2010Da5889, Dec. 23, 2010). Therefore, even if the subject matter of a collection lawsuit filed by a collection creditor is identical to the existence of a claim subject to attachment against a third debtor, the res judicata effect of such final and conclusive judgment does not affect each other unless the parties to the lawsuit are different.

(2) Article 249(3) and (4) of the Civil Execution Act provides that a garnishee, who has filed a lawsuit in a lawsuit for collection, may apply for an order to a creditor with an executory exemplification as co-litigants to participate on the side of the plaintiff, by the first date for pleading. The said provision also provides that even if an obligee who has received such order does not participate in a lawsuit, the judgment on the lawsuit shall have the effect on the lawsuit. The said provision provides that an obligee who has not received such order may extend the scope of the judgment’s effect through an order for intervention on the premise that the final judgment on the lawsuit

(3) The garnishee may avoid continuing to bring a lawsuit against himself by making in the lawsuit of collection an application for intervention order to another execution creditor or by making a repayment or deposit for the part in which the order has been filed or the part in which the order has been lost has been lost. Accordingly, even though a final and conclusive judgment in a lawsuit of collection amount raised by a creditor does not extend to any other creditor, it is not unreasonable to the garnishee.

C. The final and conclusive decision of recommending a compromise has the same effect as a judicial compromise (Article 231 of the Civil Procedure Act). The legal doctrine as seen earlier concerning the final and conclusive decision of a debt collection lawsuit is likewise applicable to cases where a decision of recommending a compromise has become final and conclusive in a debt collection lawsuit filed by a creditor against a third debtor. Therefore, even if a decision of recommending a compromise is final and conclusive in a debt collection lawsuit instituted by a creditor, the res judicata effect of the said decision of recommending a compromise does not extend to

3. Determination on the instant case

A. The lower court determined on the basis of the foregoing factual basis as follows. The legal doctrine of Supreme Court Decision 93Da52808 Decided August 12, 1994 regarding res judicata of a creditor subrogation lawsuit applies to the instant case where a ruling of recommending a compromise that waives part of a claim in the collection amount lawsuit becomes final and conclusive. As long as Nonparty 1 became aware of the fact that the prior collection lawsuit was instituted by the debtor, the res judicata effect of the instant ruling of recommending a compromise has been binding on the Plaintiff, and the Plaintiff cannot claim the remainder exceeding KRW 90 million among the claims against Nonparty 1’s Defendants against the res judicata effect of the said ruling of recommending a compromise.

B. Such determination by the court below seems to have been premised on the premise that the part of the waiver of the claim in the decision of recommending reconciliation in this case pertains to the claims subject to attachment against the Defendants by Nonparty 1. However, even if the decision of recommending reconciliation in this case was finalized with the purport that payment of KRW 90 million in the prior collection lawsuit between Nonparty 2 and the Defendants and waiver of the remaining claims, the remaining part of the waiver of the claim means that Nonparty 2 would no longer exercise the collection right against the Defendants based on the second claim attachment and collection order, and it cannot be deemed that Nonparty 2 renounced the claims against the Defendants by Nonparty 1. The waiver of the collection right does not extend to the Plaintiff who filed the lawsuit of this case based on the separate claim attachment and collection order based on the separate claim attachment and collection order. Even if it is deemed that Nonparty 2 renounced the claims subject to attachment itself in the prior collection lawsuit as shown in the court below, it does not affect the res judicata effect against the Plaintiff who received the attachment and collection order prior to the date of the decision of recommending reconciliation in this case. Therefore, the Plaintiff may seek payment against the Defendants.

The above Supreme Court Decision 93Da52808 Decided the judgment against a creditor in a creditor subrogation lawsuit is related to the case in which the judgment against a creditor has become final and conclusive, and the meaning of waiver is different from the case in which the decision of recommending settlement with the content of waiver of a claim is final and conclusive. Furthermore, even though the subject matter of a lawsuit against a creditor subrogation and a collection payment lawsuit may be deemed to be the same as the existence of a claim against a third debtor against a debtor, the subject matter of a lawsuit against a creditor subrogation lawsuit may be deemed to be the same as the case in which the subject matter of a lawsuit against a creditor is the existence of a claim against a third

Therefore, the court below erred by misapprehending the legal principles on the validity of the ruling of recommending reconciliation in the collection amount lawsuit, thereby adversely affecting the conclusion of the judgment. The ground of appeal assigning this error

4. Conclusion

The judgment of the court below is reversed without examining the remaining grounds of appeal, and 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 Dong-won (Presiding Justice)