[1] Nature of Article 30 of the former Door-to-Door Sales Act (=Control Regulations)

[2] The contents of a payment guarantee as a form of credit transaction and the method of determining the scope of guarantee

[3] Requirements for the establishment and validity of a payment guarantee contract under the former Door-to-Door Sales Act

[4] Whether a multi-level sales business entity may cancel a payment guarantee agreement with a bank after the establishment of the payment guarantee agreement under the former Door-to-Door Sales, etc. Act, and whether a multi-level sales business entity may oppose the beneficiary guarantee creditor, solely on the ground that the bank recovered the original payment guarantee agreement from the multi-level sales business entity (negative)

[5] The meaning of guarantee period under the former Door-to-Door Sales Act

[6] Whether it is necessary to possess and present a payment guarantee certificate when a payment guarantee creditor requests a payment guarantee deposit under the former Door-to-Door Sales, etc. Act (negative)

[1] Article 30 of the former Door-to-Door Sales, etc. Act (amended by Act No. 5771 of Feb. 5, 1999) provides that if Article 30 is violated, it shall be punished, but only if the requirements are met, it shall be deemed a multi-level salesman. In full view of the legislative intent of Article 30 and legislative purpose of Article 1, Article 61 (Penal Provisions) 9 and Article 30 (1) are not registered under Article 30 (2) and Article 61 (2), it is reasonable to interpret Article 30 of the same Act as a regulation provision.

[2] In the form of a credit transaction, a payment guarantee refers to a transaction in which the bank guarantees a third party’s obligation pursuant to the entrustment of the customer (applicant). A guarantee agreement entered into between the bank and the customer, based on the guarantee consignment agreement entered into between the bank and the customer, and thus, the bank, which made the payment guarantee, is liable to perform the guaranteed obligation in a case where the customer is unable to discharge the principal obligation. Such a guarantee agreement is entered into in the form of a written guarantee that the bank expresses its intent to guarantee the principal obligation in the form of a written guarantee payment guarantee and delivers it to the principal creditor who is the guarantor. The scope of the guarantee is determined through the interpretation of the guarantor’s intent expressed

[3] A guarantee transaction agreement between a multi-level marketing business entity and a bank (i.e., a guarantee transaction agreement) is for a third party. However, a guarantee contract is established and its effect takes effect by a bank again with a creditor. The parties to this guarantee contract are not a contract for a third party between a multi-level marketing business entity and a bank, but a creditor and a bank. The former Door-to-Door Sales Act (amended by Act No. 5771 of Feb. 5, 199) does not specify a creditor at the time of issuing a bank's guarantee payment guarantee certificate, and it is not possible for a multi-level marketing business entity to deliver a guarantee certificate to a creditor in this case. Thus, it is practically impossible for a multi-level marketing business entity to legally exercise a right to withdrawal within a guarantee period after purchasing goods from a multi-level marketing business entity and a multi-level marketing business entity to deliver it to the creditor. Thus, the Seoul Special Metropolitan City Mayor's certificate of payment guarantee is deemed as a multi-level marketing business entity's representative in the creditor group and the bank.

[4] Since a multi-level marketing business entity is not a party to a payment guarantee contract, a multi-level marketing business entity cannot cancel a payment guarantee contract with a bank after the establishment of the payment guarantee contract under the former Door-to-Door Sales, etc. Act (amended by Act No. 5771 of Feb. 5, 1999), and the payment guarantee transaction agreement is a type of a contract for third party, but merely because the bank recovered the original payment guarantee contract from a multi-level marketing business entity who is the client of the payment guarantee contract, it cannot be asserted against the multi-level marketing business entity who has lawfully exercised its right to withdraw within the guarantee period

[5] Generally, the guarantee period of a payment guarantee contract means that the bank bears the obligation to pay the guarantee amount within the guarantee period, and if the guarantee accident occurs within the guarantee period, the guarantee liability of the payment guarantor terminates due to the expiration of the guarantee period. The former Door-to-Door Sales, etc. (amended by Act No. 5771 of Feb. 5, 199) also a payment guarantee contract under the former Door-to-Door Sales, etc. Act (amended by Act No. 5771 of Feb. 5, 199), if a multi-level marketing salesperson purchases the product regardless of the date of purchase, and exercises the right of withdrawal within the guarantee

[6] A payment guarantee issued by a bank to guarantee the debtor's payment of goods, price obligations, etc. according to a payment guarantee transaction agreement is merely a certificate of civil guarantee, but not securities. Thus, if a creditor claims a payment guarantee, it does not necessarily require the possession and presentation of the original or copy of the payment guarantee certificate. This is also true even if there is a provision under the former Door-to-Door Sales, etc. Act (amended by Act No. 5771 of Feb. 5, 199) that "if a claim for payment is made, the claim amount shall be stated in the certificate of payment guarantee: Provided, That the claim for payment before the expiration of the payment guarantee period shall be made at the place of direct execution with relevant

[1] Articles 1, 30, and 61 subparagraph 9 of the former Door-to-Door Sales, etc. Act (amended by Act No. 5771 of Feb. 5, 199) / [2] Article 428 of the Civil Act / [3] Article 428 of the Civil Act, Articles 30, 35, 36, and 37 of the former Door-to-Door Sales, etc. Act (amended by Act No. 5771 of Feb. 5, 1999) / [4] Articles 428, 539, and 543 of the Civil Act, Article 37 of the former Door-to-Door Sales, etc. Act (amended by Act No. 5771 of Feb. 5, 199) / [5] Article 428 of the Civil Act, Article 47 of the former Door-to-Door Sales, etc. Act (amended by Act No. 5771 of Feb. 5, 19997)

[2] Supreme Court Decision 98Da27784 delivered on October 27, 1998 (Gong1998Ha, 2774), Supreme Court Decision 99Da56192 delivered on October 12, 2001 (Gong2001Ha, 2440) / [4] Supreme Court Decision 96Da32188 delivered on December 10, 1996 (Gong197Sang, 316) / [5] Supreme Court Decision 98Da8028 delivered on September 7, 199 (Gong199Ha, 2057)

Plaintiff 1 and 197 others (Law Firm Dong-dong, Attorney Shin Chang-dong, Counsel for the plaintiff-appellant)

Korea Exchange Bank (Attorney So-young et al., Counsel for defendant-appellant)

Seoul High Court Decision 99Na40526 delivered on August 31, 2001

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

We examine the grounds of appeal.

1. On the first ground for appeal

According to the reasoning of the judgment below, the court below acknowledged the fact that the Il-young International Co., Ltd. purchased goods from the non-party company around September 10, 1996, and paid or settled by credit card each of the cited amount in the list of the attached papers of the judgment below to the non-party company by the former Door-to-Door Sales Act (amended by Act No. 5771 of Feb. 5, 1999; hereinafter referred to as the " Door-to-Door Sales Act") around September 10, 1996, the non-party company's multi-level marketing was a multi-level marketing business operator established by the former Door-to-Door Sales Act (amended by Act No. 5771 of Feb. 5, 199; hereinafter referred to as the " Door-to-Door Sales Act"), and reported business suspension to the Seoul Special Metropolitan City Mayor around December 19, 197 due to the deterioration of business management, and the plaintiffs made a report on January 10, 1998.

The grounds of appeal pointing out this issue are rejected.

2. On the second ground for appeal

Furthermore, the court below rejected the defendant's assertion that multi-level salesman is a general consumer, not multi-level salesman, because multi-level salesman is registered as multi-level salesman pursuant to Article 30 of the Door-to-Door Sales Act, and multi-level salesman's registration certificate and multi-level salesman's multi-level salesman's multi-level salesman's registration certificate and multi-level salesman's multi-level salesman's multi-level salesman's registration certificate and multi-level salesman's multi-level salesman's registration certificate, the plaintiffs can recognize the plaintiffs as multi-level salesman's multi-level salesman's multi-level salesman's multi-level salesman's multi-level salesman's multi-level salesman's registration, and even if part of the plaintiffs are not registered as non-level salesman's multi-level salesman's multi-level salesman's multi-level salesman's multi-level salesman's multi-level salesman's multi-level salesman's multi-level salesman's multi-level salesman's multi-level salesman's multi-level salesman's status.

Article 30 of the Door-to-Door Sales Act provides that a multi-level marketing salesperson shall be deemed a multi-level marketing salesperson only if the requirements are met. In full view of the legislative intent of Article 30 and the legislative purpose of Article 1 and Article 30 (1) and Article 61 (Penal Provisions) through Article 61 (9) and Article 30 (2), Article 30 of the Door-to-Door Sales Act provides that a multi-level marketing salesperson shall be a person who is a multi-level marketing salesperson in violation of Article 30 (2).

The judgment of the court below to the same purport is acceptable, and there is no error in the misapprehension of legal principles as to the status of multi-stage salesmen under the Door-to-Door Sales Act.

The grounds of appeal pointing out this issue are rejected.

3. On the third ground for appeal

A. In addition, the court below rejected the defendant's defense that each of the payment guarantee contracts of this case is not effective since the non-party company entered into a payment guarantee contract of this case on October 31, 1997 with a copy of each payment guarantee contract for a third party as stipulated in Article 539 of the Civil Code, and the plaintiffs and the Mayor of Seoul Special Metropolitan City, who are the beneficiaries and their legal representatives, must express their intent to make profits. Since the plaintiffs and the Mayor of Seoul Special Metropolitan City returned the original copy of each payment guarantee certificate to the defendant and the non-party company cancel each contract with the defendant on November 31, 1997, prior to expressing their intent to make profits to the defendant, each of the payment guarantee contracts of this case is concluded in lieu of the deposit of the payment guarantee deposit of multi-level distributor of multi-level marketing business pursuant to Article 37 (6) of the Door-to-Door Sales Act, the non-party company's effect was confirmed by submitting a copy of each payment guarantee certificate to the Seoul Special Metropolitan City Mayor, and it does not have been allowed the plaintiffs or non-party beneficiary.

B. In the form of a credit transaction, a payment guarantee refers to a transaction in which the bank guarantees a third party’s obligation pursuant to the entrustment of the transaction partner. The bank is established by concluding a payment guarantee agreement with the creditor because it is based on the guarantee consignment agreement concluded between the bank and the transaction partner. Accordingly, the bank that provided a payment guarantee is liable to perform the guaranteed obligation if the transaction partner fails to perform the principal obligation. Such a payment guarantee agreement is concluded by the bank expressing its intent in the form of a written guarantee that provides a payment guarantee guarantee in the form of a payment guarantee guarantee to the creditor who is the guarantor, and the scope of the guarantee is determined through the interpretation of the guarantee intent expressed in the payment guarantee certificate, etc. (see Supreme Court Decisions 98Da2784, Oct. 27, 1998; 9Da56192, Oct. 12, 2001, etc.).

Therefore, a guarantee transaction agreement between the non-party company and the defendant, a bank (i.e., a guarantee transaction agreement) is a contract for a third party. However, it does not result in a guarantee obligation in itself, and thus, a guarantee contract is established and its validity takes effect by the defendant, and the parties to this guarantee contract are not a contract for a third party between the non-party company and the defendant, as the creditor and the defendant.

However, the payment guarantee contract under the Door-to-Door Sales Act does not specify a creditor at the time of issuing the defendant's payment guarantee certificate, and it is unique that it is an unspecified and multiple creditors group meeting the requirements of multi-stage salesman and legally exercising the right to withdraw within the guarantee period after purchasing goods from the non-party company in the future. Therefore, it is practically impossible to deliver the payment guarantee certificate to the creditor. Therefore, it is reasonable to interpret that the Seoul Special Metropolitan City Mayor, which received a copy of the payment guarantee certificate, is deemed the legal representative of the creditor group and the Seoul Special Metropolitan City Mayor, which received a copy of the payment guarantee certificate, and the payment guarantee contract between the creditor group and the defendant takes effect. Therefore, even though the creditor's declaration of intention of profits is not necessary, the condition that multi-stage salesman legitimately exercises the right to withdraw

Furthermore, the non-party company is not a party to the payment guarantee contract, and the non-party company cannot cancel the payment guarantee contract with the defendant after the formation of the payment guarantee contract and the payment guarantee transaction agreement is a kind of contract for the third party, but the defendant cannot immediately oppose the plaintiffs, the beneficiary, just because the defendant recovered the original payment guarantee letter of this case from the non-party company, the client, the original (see Supreme Court Decision 96Da32188 delivered on December 10, 196).

Although the judgment of the court below is somewhat insufficient, it is acceptable in accordance with this purport, and there is no error of law by misapprehending the legal principles on the establishment and cancellation of a payment guarantee contract under the Door-to-Door Sales Act.

The grounds of appeal pointing out this issue are not accepted.

4. On the fourth ground for appeal

The court below rejected the claim that the guarantee creditor under each of the payment guarantee contracts of this case used the right of withdrawal between the non-party company and the non-party company from August 10 to September 9 of the same year based on the payment guarantee guarantee letter as of August 1997, and the multi-stage salesman who used the right of withdrawal between August 11, 1997 and November 10 of the same year as the guarantee period of multi-stage salesman; and (2) based on the payment guarantee letter as of September 10 of the same year from September 1997 to October 9 of the same year, each multi-stage salesman purchased the goods or provided the services from the non-party company within the guarantee period as of September 11 to 10 of the same year, and each multi-stage salesman purchased the goods or provided the services from the non-party company to the non-party company within the guarantee period as of November 19, 198, regardless of its claim that the multi-stage salesman purchased the goods or provided the services within the guarantee period as of September 19, 198.

In general, the guarantee period of a guarantee contract has the meaning that the defendant bears the obligation to pay the guarantee amount within the guarantee period, and the guarantee obligation of the guarantor terminates unless the guarantee accident occurs within the guarantee period (see, e.g., Supreme Court Decision 98Da8028, Sept. 7, 1999). If a multi-level marketing salesperson purchases a product regardless of the purchase date of the product and exercises the right of withdrawal within the guarantee period, a guarantee contract under the Door-to-Door Sales Act bears the obligation to pay the refund amount to the non-party company, and the defendant bears the obligation to pay the guarantee amount.

The judgment of the court below is just as the above purport, and there is no error of law by misapprehending the legal principles as to the guarantee period of the door-to-door sales contract.

The grounds of appeal pointing out this issue are also rejected.

5. On the fifth ground for appeal

In addition, Article 39(4) of the Door-to-Door Sales Act provides that where a multi-level distributor concludes a payment guarantee contract in lieu of a deposit, a person intending to receive a refund pursuant to the provision of paragraph (1) may claim against the financial institution which provided the payment guarantee in question in accordance with the conditions of the relevant payment guarantee contract, and the defendant and the non-party company agreed that the request for the performance of the guaranteed obligation based on each payment guarantee certificate must be stated in the payment guarantee document, so the plaintiffs can only be made by the payment guarantee to the defendant in order to demand the performance of the guaranteed obligation, and the plaintiffs' claim which does not carry the payment guarantee certificate as well as the time of the lawsuit in this case, is unreasonable. The court below rejected the plaintiffs' assertion that the terms and conditions of the payment guarantee contract provide that "The request for the performance guarantee prior to the expiration of the guarantee period shall be made in direct place with relevant documentary evidence, and the non-party company concluded the payment guarantee contract with the defendant in accordance with the relevant provisions of the Door-to-Door Sales Act and received the original copy, and thus, it cannot be deemed as a copy of the plaintiffs's claim.

The payment guarantee issued by a bank in order to guarantee the payment of the debtor's goods, price obligations, etc. according to a payment guarantee transaction agreement is merely a civil guarantee, not securities. Thus, if a creditor claims a payment guarantee, it does not necessarily require the possession and presentation of the original or copy of the payment guarantee. This is likewise true even if each of the payment guarantee contracts of this case is stipulated in the terms and conditions as alleged by the defendant as to each of the instant payment guarantee contracts (see, e.g., Supreme Court Decision

The judgment of the court below is just and acceptable, and there are no errors in the misapprehension of legal principles as to the method of exercising the right by the creditor under the Door-to-Door Sales Act.

The grounds of appeal pointing out this issue are rejected.

6. Therefore, the appeal is dismissed, and all 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 Yoon Jae-sik (Presiding Justice)