Of the terms and conditions of comprehensive insurance for business purpose motor vehicles, "no compensation shall be made to any employee of the insured who can receive accident compensation under the Industrial Accident Compensation Insurance Act," and "no compensation shall be made even in cases where damage has occurred beyond the scope of compensation under the Industrial Accident Compensation Insurance Act" shall be effective in the provision of the exemption clause (negative).

Article 6(1) and (2)1 and Article 7(2)2 of the Regulation of Standardized Contracts Act, Article 663 of the Commercial Act, Article 5 of the Industrial Accident Compensation Insurance Act

Supreme Court en banc Decision 2003Da2802 Delivered on March 17, 2005 (Gong2005Sang, 586)

Park Jae- Line (Attorney Kim Jae-Gyeong, Counsel for the plaintiff-appellant)

Tran Fire Marine Insurance Co., Ltd. (Attorney Lee Jong-sung, Counsel for the plaintiff-appellant)

Seoul High Court Decision 2004Na15302 delivered on June 15, 2005

The part of the lower judgment against the Plaintiff is reversed, and that part of the case is remanded to the Seoul High Court.

1. The judgment of the court below

The court below, based on its employed evidence, concluded an integrated insurance contract for business cars with the defendant as to the automobile studio 4240 (hereinafter “instant automobile”) owned by the company installing a building ventilation facility with a number of regular workers of not less than one, and Article 11(2)4 of the Terms and Conditions for Business Automobile Insurance, which applies to the instant insurance contract, can be compensated as an employee of the insured who is liable for damages due to an accident in the course of operation of insured automobile, the defendant is exempted from liability for damages for the portion beyond the scope of liability covered by liability insurance; on June 1, 2001, around 07:40, the court below acknowledged that the defendant was exempted from liability for damages for the automobile 200 minutes of the instant automobile studio 200 (hereinafter “the instant automobile”). On June 1, 2001, the court below concluded that the plaintiff was on board the front line of the instant automobile 200 Embio 27,000 pul 263,000.

Based on these facts, the court below determined that the instant accident constitutes occupational accidents, which occurred in the course of performing the business of an enterprise which is operated by gambling, and the number of workers at which the business operated by gambling falls under one or more business is naturally subject to the Industrial Accident Compensation Insurance Act (amended by Act No. 7049 of Dec. 31, 2003; hereinafter “Industrial Accident Insurance Act”) pursuant to Article 5 of the former Industrial Accident Compensation Insurance Act (amended by Act No. 7049 of Dec. 31, 2003), and that the construction of ventilation facilities subcontracted is merely three million won of total construction cost and thus constitutes an industrial accident accident under Article 3 (1) 3 of the former Enforcement Decree of the Industrial Accident Compensation Insurance Act (amended by Presidential Decree No. 1797 of May 7, 2003), but it constitutes an industrial accident under Article 1 of the former Enforcement Decree of the Industrial Accident Compensation Insurance Act where a contractor, at least 60,700,000 won of the total construction cost of a motor vehicle insurance contract, which is covered by the Act.

2. Judgment of the Supreme Court

However, it is difficult to accept such judgment of the court below for the following reasons.

According to the records, Article 11(2)4 of the Industrial Accident Compensation Insurance Clause applicable to the insurance contract of this case provides that "no compensation shall be made to an employee of the insured who is liable to compensate for losses under the Industrial Accident Compensation Insurance Act (no compensation shall be made even if any damage has occurred beyond the scope of compensation under the same Act)". The purport of the provision provides that "an employee of the insured who is liable to compensate for losses under the Industrial Accident Compensation Insurance Act shall not be compensated for losses arising from occupational accidents in the employment relationship between the employer and the employee," which provides for various liability for compensation under the Labor Standards Act governing the employment relationship, and as such, an industrial accident insurance system is established under the Industrial Accident Compensation Insurance Act to secure such liability, so it shall be compensated by industrial accident insurance for damages caused by occupational accidents which are the subject of industrial accident insurance, and it shall be interpreted that the insurer shall not be held liable for damages within the scope of automobile accident compensation under the Industrial Accident Compensation Insurance Act for the purpose of compensating for damages to a third party, which goes beyond the scope of compensation liability under the Industrial Accident Compensation Insurance Act."

Nevertheless, the court below held that the liability for compensation is exempted for the part beyond the scope of compensation under the Industrial Accident Insurance Act, without examining at all as to whether the Plaintiff suffered damages exceeding the scope of compensation under the Industrial Accident Insurance Act, on the premise that the exemption clause under Article 11 (2) 4 of the Industrial Accident Compensation Insurance Clause of the Industrial Accident Compensation Insurance Clause applicable to the insurance contract of this case is valid, on the condition that the exemption clause under Article 11 (2) 4 of the Industrial Accident Compensation Insurance Clause of the Industrial Accident Compensation Insurance Act is valid. It is obvious that the court below erred in the misapprehension of legal principles as to the validity of the Industrial Accident Compensation Insurance Exemption Clause, which affected the conclusion of the judgment.

3. Conclusion

Therefore, the part of the lower judgment against the Plaintiff is reversed, and that part of the case is remanded to the lower court for a new trial and determination. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Kim Young-ran (Presiding Justice)