In a case where an injured worker received insurance benefits from the Korea Workers' Compensation and Welfare Service pursuant to the Industrial Accident Compensation Insurance Act due to an act of a third party, whether the damage claim against a third party is reduced to the extent of the amount of benefits acquired by the Korea Workers' Compensation and Welfare Service by subrogation (affirmative)

Article 87(1) of the Industrial Accident Compensation Insurance Act

Supreme Court Decision 87Meu2057 Decided June 27, 1989 (Gong1989, 1138) Supreme Court Decision 2015Da23028 Decided December 10, 2015

Plaintiff 1 and three others (Attorney Nowon-gu, Counsel for the plaintiff-appellant)

Hyundai Marine Fire Insurance Co., Ltd. (Attorneys Lee So-uri et al., Counsel for the plaintiff-appellant)

Seoul High Court Decision 2016Na2016656 decided July 14, 2016

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

The grounds of appeal are examined.

1. As to the grounds of appeal Nos. 1 and 2

A. Where an injured worker received insurance benefits from the Korea Workers’ Compensation and Welfare Service pursuant to the Industrial Accident Compensation Insurance Act due to a disaster caused by a third party’s act, his/her damage claim against a third party is acquired by the Korea Workers’ Compensation and Welfare Service by subrogation within the scope of the amount of benefits, and thus, reduced accordingly (see Supreme Court Decision 87Meu2057, Jun. 27, 1989). In addition, the Korea Workers’ Compensation and Welfare Service may subrogate the tortfeasor or the insurer with respect to the whole amount of insurance benefits within the scope of the damaged employee’s damage claim after providing the insurance benefits to the victimized employee. Here, money paid to the injured party for compensation after receiving the insurance benefits from the Korea Workers’ Compensation and Welfare Service (see, e.g., Supreme Court Decision 2015Da

B. The court below interpreted the proviso of Article 682(1) of the Commercial Act to the effect that even if the insurer of a part insurance pays the total insurance money to the insured, if the insured’s claim against a third party remains, the insured may exercise the claim preferentially against the insurer, and in light of the legislative purpose of the Industrial Accident Compensation Insurance Act, inasmuch as the same legal principle is applied with respect to the exercise of the right of indemnity by the Korea Workers’ Compensation and Welfare Service, and the subrogation right of the Korea Workers’ Compensation and Welfare Service cannot be prejudicial to the plaintiffs’ rights, the defendant paid the insurance money to the plaintiffs within the limit of KRW 30 million,00,000,000, which is the maximum insurance money, and the remaining amount should be paid

C. However, based on the facts acknowledged by the lower court, the Korea Workers’ Compensation and Welfare Service paid KRW 84,056,460 in total insurance money under the Industrial Accident Compensation Insurance Act with respect to the instant accident caused by the defect in the installation or preservation of the structure of Nonparty 1 by December 19, 2013 to the deceased Nonparty 2 and the Plaintiffs, their bereaved family members. In light of the aforementioned legal principles, the Defendant, who is the insurer of Nonparty 1, should pay the insurance money to the Korea Workers’ Compensation and Welfare Service within the limit of the insurance amount with respect to the same nature of the insurance money received from the Plaintiffs out of the damages claim against Nonparty 1. On the premise that the proviso of Article 682(1) of the Commercial Act that limits subrogation in the case of partial non-life insurance, should apply mutatis mutandis to the non-life insurance, the lower court erred by misapprehending the legal doctrine on the scope of the right to indemnity under Article 87(1) of the Industrial Accident Compensation Insurance Act.

2. Conclusion

Therefore, without further proceeding to decide on the remaining grounds of appeal, the judgment of the court below is reversed, and the case is remanded to the court below for a new trial and determination. It is so decided as per Disposition by the assent of all participating Justices

Justices Lee Ki-taik (Presiding Justice)