[1] In cases where it is evident that a refusal of payment is made on the face of a bill, whether an endorsement with maturity prior to the lapse of the time limit for drawing up the protest for refusal of payment has the same effect as an endorsement before maturity (affirmative)

[2] Whether the person against whom an endorsement with the same effect as an endorsement before maturity has to present his/her right to recourse in order to preserve his/her right to recourse in the position of the last holder of the bill (affirmative)

[3] Whether the endorsement, after maturity, has succeeded to the right of recourse preserved by the endorser upon his/her presentment of payment by the endorser, as the same effect as the assignment of nominative claim, can be asserted and exercised (affirmative)

[1] Under Article 20 of the Bills of Exchange and Promissory Notes Act, an endorsement after maturity shall have the same effect as an endorsement before maturity if it was made before the protest for non-payment is drawn up or after the lapse of the time limit for drawing up the protest for non-payment, and even if the fact of non-payment is clear on the face of a bill, such as the attachment of an attachment of a part of the payment bank to the effect that the check is bound by the exchange on the bill presented at maturity and the refusal of payment is made due to the occurrence of fraudulent exploitation or the shortage of deposits, it shall not be deemed that the lawful protest for non-payment has been drawn up. Thus, even if an endorsement is made before the drawing up of the protest for non-payment, it shall have the same effect as an endorsement before maturity, which is not an endorsement after maturity.

[2] In order to preserve the right of recourse against the obligor, such as the endorser, etc., in the position of the final holder of the bill, the person to whom the endorsement has the same effect as the endorsement before maturity, must present the payment to him/her within the lawful period of presentment, regardless of whether the endorser who made the endorsement after maturity presented the payment to him/her.

[3] If the endorser of an endorsement after maturity was aware of the fact that the endorser was refused to make payment upon presentment of payment, the endorser may assert that the right of recourse preserved by presentment of payment has been succeeded to the same effect as that of the assignment of nominative claim, and may be exercised.

[1] Article 20 (1) of the Bills of Exchange and Promissory Notes Act / [2] Articles 38 and 44 of the Bills of Exchange and Promissory Notes Act / [3] Article 20 (1) of the Bills

[1] Supreme Court Decision 87Meu152 decided Aug. 25, 1987 (Gong1987, 1519)

Plaintiff (Attorney Kim Jung-chul et al., Counsel for the plaintiff-appellant)

Defendant (Attorney Han-chul et al., Counsel for defendant-appellant)

Daegu District Court Decision 97Na16204 delivered on July 7, 1999

The part of the lower judgment against the Defendant regarding the claim for promissory notes is reversed, and that part of the case is remanded to the Daegu District Court Panel Division. The Defendant’s remaining appeal is dismissed.

The grounds of appeal are examined.

1. As to the violation of the rules of evidence as to the check transfer

Upon examining the reasoning of the judgment below in light of the records, the court below acknowledged the facts as stated in its ruling as to the process of changing the date of issuance from June 3, 1995 to June 30, 1995. Although the defendant signed and sealed before the alteration of the check of this case, the defendant shall not only consented to the alteration of the date of issuance of the check of this case, but also ratified it later. Thus, the defendant shall be held liable in accordance with the wording after the alteration, and it is just to reject the defendant's defense that the plaintiff lost its right of recourse against the defendant because the plaintiff did not present payment within the lawful period of payment as of the date of issuance before the alteration, and there is no error in the rules of evidence against the rules of evidence. This part of the grounds for appeal cannot be accepted.

2. As to the misapprehension of legal principles as to endorsement after maturity

Pursuant to Article 20 of the Bills of Exchange and Promissory Notes Act, an endorsement after maturity shall have the same effect as an endorsement before maturity, if it was made before the protest for non-payment is made or after the lapse of the period for drawing up the protest for non-payment, and even if it is clearly clear on the face of a bill that the non-payment is to be refused due to the check of exchange on the bill presented for payment at maturity and the check of the bank's non-payment is bound by the check of the bill, such as receiving money or shortage of deposits, it cannot be said that the lawful protest for non-payment has been drawn up. Therefore, an endorsement made on such bill shall be deemed to have the same effect as an endorsement before maturity, which is not an endorsement after maturity (see Supreme Court Decision 87Meu152, Aug. 25, 1987).

According to the reasoning of the judgment below, the court below determined that each of the non-party 1 and non-party 2's endorsement has the same effect as that of the previous endorsement, on July 15, 1995, when the non-party 1 presented payment at the place of payment on the maturity of the bill of this case, but refused payment on the ground of non-party 1's non-party 1's non-party 1's non-party 2 and the plaintiff's non-party 2's non-party 2's non-party 2's each endorsement was made after the expiration of the period for drawing up the protest. Thus, the court below's decision that each of the non-party 1 and non-party 2's non-party 2's endorsement is justified in light of the above legal principles.

However, in order to preserve the right of recourse against the obligor, such as the endorser, etc., in the position of the last holder of the bill with the same effect as the endorsement prior to maturity, the endorser, regardless of whether the endorser, who made the endorsement after maturity, presented payment to him/her within the lawful payment deadline, shall present him/her again within the period for presentment. Thus, unless there is any assertion or proof on the fact that the Plaintiff voluntarily presented payment of the bill of this case, the right of recourse cannot be exercised against the Defendant, who is the endorser, in the position of the last holder of the bill of this case.

However, if the plaintiff, who is the endorsement after maturity, was aware of the fact that the non-party 1 was refused to pay after the presentment of payment, the non-party 1 may assert and exercise the right of recourse preserved by the non-party 1 as the same effect as the assignment of nominative claim. In the case where the plaintiff exercises the right of recourse by using the non-party 1's presentation of payment, the defendant may oppose the plaintiff on the ground of the defense against the non-party 1. In such a case, the court below should have further judged the defendant's defense against the non-party 1.

Nevertheless, the court below rejected the defendant's defense that the defendant could not set up a defense against the non-party 2 and the plaintiff on the ground that each of the non-party 1 and the non-party 2's endorsement cannot set up a defense against the non-party 1, on the ground that the non-party 1's personal defense against the non-party 2 and the plaintiff can be set up against the non-party 1, and the plaintiff's exercise of the plaintiff's right of recourse against the defendant is justified, without examining whether the plaintiff's presentation of the bill of this case to pay the bill within the lawful period of time for presentment of payment satisfies the requirements for the preservation of the right of recourse and its validity, or whether the defendant's defense against the loan was legitimate. The part of the grounds of appeal pointing this out is with merit.

3. Therefore, the part of the lower judgment against the Defendant regarding the claim for promissory notes is reversed, and that part of the case is remanded to the lower court for further proceedings consistent with this Opinion. The Defendant’s remaining appeal is dismissed. It is so decided as per Disposition by the assent of all participating Justices.

Justices Lee Yong-woo (Presiding Justice)