Whether the transferor of registered shares is entitled to file a claim for change of title with the company under the name of the transferee (negative)

The right to claim a change of ownership is a right to claim the company to enter its name, address, etc. on the registered shares in the register of shareholders on the basis of a shareholder’s right, and to claim a change of ownership on the registered shares only by the person who acquired the registered shares. In addition, as a matter of principle, the person who acquired the registered shares has the right to freely decide whether to transfer the registered shares or not to dispose of them to another person without a change of ownership, barring any other special circumstances, the transferor is not entitled to claim a change of ownership in the name of the transferee of the shares to the company, barring any other special circumstances. This legal principle applies not only to the case where the registered shares are issued upon delivery of the share certificates, but also to the case where the registered shares are transferred by the declaration of intention between the transferor

Articles 335(3) and 337(1) of the Commercial Act

Supreme Court Decision 92Da16386 delivered on October 27, 1992 (Gong1992, 3261) Supreme Court Decision 94Da47728 delivered on March 24, 1995 (Gong1995Sang, 1731)

Plaintiff

E. E.S. E.C.D.

Seoul High Court Decision 2009Na27270 decided October 14, 2009

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

The grounds of appeal are examined.

1. Examining the reasoning of the lower judgment in light of the record, it is difficult to readily conclude that Nonparty 1, 2 (hereinafter “Nonindicted 1, etc.”) was merely a type shareholder of the instant registered shares, and that in fact, the Plaintiff, Nonparty 3, 4, and 5 (hereinafter “Plaintiff, etc.”) was a beneficial shareholder of the instant registered shares. In addition, even if Nonparty 1, etc. was not a type shareholder, it cannot be deemed that Nonparty 1, etc. requested the Defendant Company to transfer the ownership of the instant registered shares on February 18, 2008.

The court below is just in holding that there is no evidence to support the fact that the plaintiff et al. acquired the registered shares of this case from the non-party 1 and then requested the defendant company to transfer the registered shares, and there is no error in the misapprehension of legal principles as to who is the applicant for transfer of the registered shares, or failing to

2. The right to claim the change of holders is a right to claim the company to enter its name, address, etc. on the company’s registered shares on the basis of shareholders’ rights, and to claim the change of holders on the registered shares only by the person who acquired the registered shares. In addition, as a matter of principle, the person who acquired the registered shares has the right to freely decide whether to transfer the registered shares or not to dispose of them to another person without a change of holders, barring any special circumstances, barring any other circumstance, the transferor is not entitled to claim the change of holders in the name of the transferee of the shares to the company. This legal principle applies not only to the case where the share certificates are issued and the registered shares are transferred by delivery of the share certificates, but also to the case where the registered shares are transferred by declaration of intention between the transferor and transferee

Examining the reasoning of the lower judgment in light of the aforementioned legal principles, even if Nonparty 1, etc. transferred the instant registered shares for which no share certificate was issued at the lapse of six months after the establishment of the Defendant Company to the Plaintiff, etc., and thereafter, on February 18, 2008, notified the Defendant Company of the transfer by mail with the content-proof document with a fixed date and applied for the transfer of ownership in the name of the Plaintiff, etc., it cannot be said that the Defendant Company’s refusal of the transfer cannot be deemed to be unjust.

The decision of the court below to the same purport is just, and there is no error in the misapprehension of legal principles as to the transfer of shares as otherwise alleged in the ground of appeal.

3. 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 Kim Ji-hyung (Presiding Justice)