2016Da228109 Requests for the return of the price of goods

A Stock Company

H

Co., Ltd.

Seoul Central District Court Decision 2015Na51622 Decided May 20, 2016

September 8, 2016

The judgment of the court below is reversed, and the case is remanded to the Seoul Central District Court Panel Division.

The grounds of appeal are examined.

Article 395 of the Commercial Act provides for the company's liability for the act of a director who uses a name that can be recognized as a representative director. In order to protect a third party who has trusted the appearance of a representative director in accordance with the doctrine of notions or theory of external appearance by an indication, the above provision shall apply mutatis mutandis to cases where a company allows a third party who is responsible for the existence of such appearance to use the name of the representative director who is expressed in good faith, as well as cases where a company allows a person who is not qualified as a director to use the name of the representative director who is expressed in his/her own discretion, but has neglected the company's use of the name of the representative director who is expressed in his/her own discretion, without taking any measures (see, e.g., Supreme Court Decision 97Da34709, Mar. 27, 199

Nevertheless, the court below rejected the Defendant’s assertion that “the Plaintiff’s former representative director G, in the name of the Plaintiff’s representative director, delivered the Promissory Notes to the Defendant for the payment of the Defendant’s obligation to D” (Evidence No. 3-2) and the issuance of the Promissory Notes to the Defendant is an act as an expression stand-off director as prescribed in Article 395 of the Commercial Act.” The court below rejected the Plaintiff’s assertion on the ground that G is not a Plaintiff’s regular director. The court below erred by misapprehending the legal principles on the expression stand-off director, thereby failing to exhaust all necessary deliberations, thereby adversely affecting the judgment. The ground of appeal No. 2 pointing this out is with merit. Therefore, the judgment of the court below is reversed without examining the remaining grounds of appeal, and the case is remanded to the court below for further proceedings consistent with this Opinion. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Park Sang-ok

Justices Lee Sang-hoon

A person shall be appointed.