The judgment below is reversed and the case is remanded to Seoul High Court.

The grounds of appeal are examined.

1. The bona fide acquisition of share certificates is a system that protects a person who trades in trust outside the right of possession of share certificates.

The acquisition of share certificates is not recognized in good faith or by gross negligence (Article 359 of the Commercial Act and Article 21 of the Check Act). The issue of whether a person has bad faith or gross negligence is determined on the basis of the time of acquisition. The term “ bad faith” refers to the acquisition by the previous holder of a share certificate knowing that there is a defect in a delivery contract, that is, the previous holder is an unentitled person, incompetent person, or lack of power of representation, and the gross negligence refers to a lack of duty of care required for a transaction.

(See Supreme Court Decision 9Da58471 delivered on September 8, 2000). In a case where the transferor acquires share certificates without any reasonable investigation as to whether the transferor is an unentitled person in light of the common transaction standards when acquiring share certificates, etc., the transferee should be deemed to have “serious negligence” as prescribed in Article 359 of the Commercial Act and the proviso of Article 21 of the Check Act.

(Supreme Court Decision 2006Da58684 Decided November 9, 2006). 2. A.

The judgment below

The reasoning and the evidence admitted by the court below reveal the following facts.

(1) On December 31, 2012, where C had worked as the Chairperson of E, the Defendant purchased registered ordinary shares of 60,000 shares (hereinafter “instant shares”) issued by the Defendant from the Defendant’s Intervenor, an affiliate company of the said company, the Defendant, at its face value of 10,000 (hereinafter “instant shares”) and purchased the purchaser’s name.

C On January 25, 2013, upon entering into a title trust agreement with D on title trust (hereinafter “instant title trust agreement”) with D, it had D pay KRW 600 million of the purchase price of the instant shares to the Defendant joining the Defendant.

(ii).