Appellant 1 and two others (Law Firm LLC et al., Counsel for the appellant-appellant)

Korea Daily Co., Ltd.

The administrator, non-party 1 (non-party to the decision of the Supreme Court) (Law Firm Construction, Attorney Kim Jong-soo, Counsel for the plaintiff-appellant)

Seoul Central District Court Order 2013 Ma142 dated September 6, 2013

1. All of the instant appeals are dismissed.

2. Costs of appeal shall be borne by the appellant.

1. Purport of request;

The rehabilitation procedures shall commence for the debtor.

2. Purport of appeal;

The decision of the first instance is revoked and the case is remanded to the Seoul Central District Court.

1. The decision of the first instance and the reasons for an immediate appeal;

The applicants, including Nonparty 2, who were creditors who did not receive wages, allowances, retirement allowances, etc. from the debtor company, filed an application with the Seoul Central District Court 2013 Gohap142 for the commencement of rehabilitation procedures against the debtor company. On September 6, 2013, the above court decided the first instance court to the effect that rehabilitation procedures were commenced against the debtor company and that Nonparty 1 is appointed as the administrator of the debtor company. Accordingly, the appellant, who is the shareholders of the debtor company, filed the instant immediate appeal as the interested parties of the above case.

2. Determination on the legitimacy of the petition

The reasoning for this part is as stated in the first instance court’s decision No. 2, 4, and 4, except where the first instance court’s decision “Article 43” is deemed to be “Article 34, Article 443(1) and Article 420 of the Civil Procedure Act. Therefore, the reasoning for this part is as follows.

3. Judgment on whether the grounds for commencement of rehabilitation procedures exist

The reasoning for this part is as follows. The court’s reasoning is that “ August 22, 2013” of the first instance court Order 6, 6, 15 is dismissed as “ August 23, 2013.” 6, 16, 16, and 10, 4, 4, 10, 4, 10, and 420 of the Civil Procedure Act is the same as the “determination as to the existence of the cause for commencement of rehabilitation procedures” of the first instance court Order 4,43(1), and 420 of the Civil Procedure Act.

【Revised Contents】

B. Determination

1) According to the facts acknowledged above, the debtor company has a reason to commence the rehabilitation procedure under Article 34(1) of the Act, since the fact (in excess of the debt) which is the cause of bankruptcy occurred in the debtor company.

2) On this issue, the appellant asserts that there is a ground to dismiss the application for the commencement of rehabilitation procedure under each subparagraph of Article 42 of the Act, since the appellant's claims against the obligor company are claims for wages and retirement allowances, so if rehabilitation procedures for the obligor company are not commenced, the applicants are in a position to receive the top priority dividends in various auction procedures. Upon commencement of rehabilitation procedures for the obligor company, the applicants shall be paid in proportion to other public interest creditors, and the proceeds from sale of a specific property for which rehabilitation security rights are established shall not be paid in preference to the rehabilitation secured creditors, and the status of the applicants may not be paid in preference to the rehabilitation secured creditors. In addition, the applicants filed the application for rehabilitation in this case for the main purpose of replacing the major shareholders and management of the obligor company by promoting the merger of the acquisition of the company in the rehabilitation procedures in addition to the recovery of claims, since the applicants filed the application for rehabilitation in this case with the aim of replacing the major shareholders of the obligor company

The reason for the appellant’s assertion alone is that rehabilitation procedures for the debtor company commence, and it is difficult to view that the applicant’s status in the recovery of the claim is more unfavorable than the case where rehabilitation procedures commence. The materials submitted by the appellant alone are insufficient to vindicate that the applicant filed the instant application for the primary purpose of replacing the major shareholder and management of the debtor company, and there is no other evidence to vindicate this otherwise. Thus, the appellant’s assertion is without merit.

5. Conclusion

If so, the applicant's application is reasonable, and the rehabilitation procedure shall commence against the debtor company, and the decision of the court of first instance is just in conclusion, and the appeal of this case is dismissed in its entirety as it is without merit.

Judges Lee Sang-sung (Presiding Judge)