[1] Whether the proviso of Article 107(1) of the Civil Act applies mutatis mutandis to an act of acting as an agent in breach of trust (affirmative), and the criteria for determining whether the other party's bad faith or negligence

[2] The case denying the establishment of a deposit contract by applying the proviso of Article 107(1) of the Civil Code in a case where the standing director of a credit union pays a higher rate of interest, which is separate from the normal interest, first of all, and receives deposit money, and arbitrarily uses it, by applying the proviso of

[1] Articles 107 (1) and 116 of the Civil Act / [2] Articles 107 (1) and 116 of the Civil Act

[1] Supreme Court Decision 97Da43826 delivered on February 13, 1998, Supreme Court Decision 98Da39602 delivered on January 15, 1999 (Gong1999Sang, 290) Supreme Court Decision 2000Da20694 Delivered on January 19, 2001 (Gong2001Sang, 504)

west-si (Attorney Seo-gu, Counsel for the plaintiff-appellant)

Korea Deposit Insurance Corporation (Attorney Kim Jong-soo, Counsel for defendant-appellee)

Daegu High Court Decision 2003Na2445 delivered on October 1, 2003

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

The grounds of appeal are examined.

In a case where the other party knew or could have known that the other party's expression of intention was made by an agent and the intention of the agent was in breach of trust for the benefit of himself or a third party against the principal's interest or will, the principal cannot be held liable for the act of the agent under an analogical interpretation of the proviso of Article 107 (1) of the Civil Act. Whether the other party knew or could have known that the other party was not the intention of the agent should be determined reasonably based on objective circumstances, such as the process of formation of the expression of intention between the agent and the other party, the contents thereof, and the effects arising therefrom, etc. (see Supreme Court Decisions 97Da43826, Feb. 13, 1998; 98Da39602, Jan. 15, 199).

According to the reasoning of the judgment below, based on the facts established based on the comprehensive examination of evidence, the court below determined that the non-party 1, a manager of the non-party credit union (hereinafter referred to as the "non-party credit union") received a higher rate of interest from the plaintiff, first of all, from the normal interest, and then arbitrarily used the deposit money under the so-called deposit agreement, and that the non-party 1's expression of intent to conclude each deposit contract in the name of the non-party 1 was a breach of trust against his own interest against the non-party 1's interests and intent. It is extremely exceptional that the plaintiff did not have any specific connection with the region, and that the non-party 1's deposit contract was deposited several times in the non-party credit union which is a small financial institution that did not have any previous transaction, and that the plaintiff received a higher rate of interest than the normal interest from the non-party 1 through the fund laundering company prior to the conclusion of each deposit contract, even if it was difficult for the non-party 1 to have been aware that it would have been more effective within 20% interest at the time.

In light of the above legal principles and records, the fact-finding and decision of the court below is just, and there is no error in the misapprehension of facts against the rules of evidence or in the misapprehension of the legal principles as to the expression of intention without intention as alleged in the grounds of appeal.

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 Park Jae- Jae (Presiding Justice)