[1] Criteria for determining the applicable law under the former part of Article 9 of the former Conflict of Laws Act

[2] Requirements for revocation of a legal act on the ground of a motive mistake

[1] Article 9 (see current Article 25 of the Private International Act) of the former Conflict of Laws (amended by Act No. 6465 of April 7, 2001) / [2] Article 109 of the Civil Act

[1] Supreme Court Decision 2002Da56130, 56147 decided Jun. 25, 2004 (Gong2004Ha, 1230) / [2] Supreme Court Decision 97Da4737 decided Feb. 10, 1998 (Gong198Sang, 686), Supreme Court Decision 2000Da12259 decided May 12, 200 (Gong200Ha, 1417)

Plaintiff 1 and four others (Law Firm Dong-dong et al., Counsel for the plaintiff-appellant)

Defendant (Attorney Han-soo et al., Counsel for the defendant-appellant)

Seoul Central District Court Decision 2004Na27388 Decided September 14, 2006

All appeals are dismissed. The costs of appeal are assessed against the plaintiffs.

The grounds of appeal are examined (to the extent of supplement in case of supplemental appellate briefs not timely filed).

1. Regarding ground of appeal No. 1

A. In making a legal judgment on the validity of the agreement between the Plaintiffs and the Defendant on June 21, 2001 (hereinafter “instant agreement”), the lower court applying the Civil Act of the Republic of Korea to the effect that the said agreement is unlawful, despite the fact that the Plaintiffs’ ground of appeal was first raised in the first instance, and cannot be a legitimate ground of appeal.

B. Furthermore, even if the governing law applicable to the validity of the instant agreement is examined, it is reasonable to view the Civil Code of the Republic of Korea as the governing law for the following reasons.

Article 9 of the former Conflict of Laws (amended by Act No. 966 of Jan. 5, 1962 and amended by Act No. 5809 of Feb. 5, 199), which had been in force at the time of the agreement in this case, provides that "the law applicable to the establishment and validity of the act in this case shall be determined by the party's intent. However, if the party's intent is not clear, the law applicable to the act in this case shall apply." Accordingly, in determining the governing law by the party's intent, if there is an explicit agreement as to the choice of governing law, the party's implied intent should be presumed based on the party's expression of intent other than the governing law included in the agreement in this case's agreement, or the party's attitude expressed through the act of litigation. Even if such implied intention cannot be presumed, considering the party's nationality, address, etc., background of the formation of the agreement in this case and other objective circumstances, it shall be presumed that the party would have designated the governing law at the time of this case's agreement.

In light of the above legal principles and records, it is determined that the applicable law applicable to the validity of the agreement in this case is consistent with the implied intent of the parties.

C. Therefore, the plaintiffs' assertion in this part of the grounds of appeal cannot be accepted.

2. Regarding ground of appeal No. 2

A. As to the allegation of revocation of the instant agreement based on mistake

If a motive mistake falls under a mistake in an important part of the contents of a juristic act on the ground that it constitutes a mistake in the contents of the juristic act, it is sufficient that the other party stated the motive in the content of the juristic act in question and it is deemed that the other party is an object of the juristic act in the interpretation of an expression of intent, and it is not necessary to conclude that the parties agree to separately consider the motive as an object of the juristic act. However, the mistake in the contents of the juristic act should be related to the important part of the juristic act so long as it would have been deemed that it would not have been intended if the general public entered into the position (see, e.g., Supreme Court Decisions 97Da44737, Feb. 10, 1998; 200Da12259, May 12, 200).

The court below acknowledged the facts and circumstances as stated in its reasoning based on the adopted evidence. In light of the above, the court below determined that (i) the plaintiffs (the inheritors of the non-party 1 who are the non-party 1) agreed to transfer their shares to the defendant (the non-party 1's Nam) by the agreement of this case constitutes 30% of total shares issued by the (name omitted) stock company (the non-party 1's 3,000 shares; hereinafter referred to as "the shares of this case") not the non-party 1 nominal trust with the deceased non-party 2; and (ii) the plaintiffs' belief that the shares of this case were nominal trust with the non-party 1 and did not lead to the agreement of this case on the premise that the agreement of this case was not entered into by mistake or the attorney-at-law before the conclusion of the agreement of this case; and (iii) the plaintiffs' assertion that the agreement of this case was not made with respect to the non-party 1's intention to transfer the shares of this case, and thus, it cannot be viewed that the plaintiffs' assertion was made by mistake or omission.

Upon examining the reasoning of the judgment below in light of the records, the above fact finding and judgment of the court below are just and acceptable, and there are no errors in the misapprehension of legal principles as to the cancellation of juristic act on the grounds of misconception of facts or mistake due to violation of the rules of evidence, as

B. As to the ground of revocation of the instant agreement based on fraud

The court below acknowledged the facts and circumstances as stated in its decision by taking full account of the adopted evidence, and, in light of such facts and all the evidence, it is difficult to recognize the plaintiffs' assertion that the defendant deceivings the plaintiffs by driving out a false statement to the effect that "the plaintiffs want to transfer the shares of this case to the defendant" at the time of the conclusion of the agreement of this case, and even if it is assumed that there was such deception, it is difficult to view the plaintiffs to have caused the agreement of this case by mistake due to such deception only by the plaintiffs.

Examining the reasoning of the judgment below in light of the records, the above fact-finding and judgment of the court below are just and acceptable, and there are no errors in the misapprehension of legal principles as to the cancellation of juristic act on the grounds of mistake of facts or fraud due to violation of the rules of evidence

3. Therefore, all appeals are dismissed, and the costs of appeal are assessed against the losing plaintiffs. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Kim Yong-dam (Presiding Justice)