[1] Whether Article 395 of the Commercial Act applies mutatis mutandis to the act of an apparent representative director who is not qualified as a director (affirmative)

[2] Whether Article 395 of the Commercial Code shall apply where an apparent representative director uses another representative director's name (affirmative)

[3] The contents of "the other party's good faith" under Article 395 of the Commercial Code concerning the liability of expression representative director

[4] In a case where a resolution of the board of directors is necessary for an act recognized as an act of an expression representative director and the other party knew or could have known that the resolution was not made (negative), whether the

[1] Article 395 of the Commercial Act provides for the company's liability for acts of directors using a name that can be recognized as having the right to represent the company, and therefore, the expression representative director must be qualified as a director. However, this provision aims to protect a third party who trusted the appearance of a representative director in accordance with the doctrine of gold-competing or external theory based on an indication, and make the company responsible for such acts of a third party acting in good faith, as well as allowing a person who is not qualified as a director to use the name of the expression representative director, as well as allowing a company to use the expression representative director's name to a person who is not qualified as a director, and not taking any measure with the company's knowledge that a person who is not qualified as a director is using the expression representative director's name at his own discretion

[2] Article 395 of the Commercial Act applies not only to cases where an apparent representative director used his/her own name to do a legal act, but also to cases where he/she did an act using another representative director's name without

[3] "Good faith" under Article 395 of the Commercial Code means that an expression representative director did not know that he/she had no power of representation, and it does not necessarily need to be limited to that of failure to know that he/she was not a nominal representative director.

[4] The acts of the representative director and the acts of the representative director without the resolution of the board of directors are all acts that are not originally responsible for the company, but they are also protected by a third party who trusted such acts on the basis of the safety of transaction and the spirit of external appearance theory. However, in the former case, the object of trust by the third party is the existence of the representative authority in the latter case, while in the latter case, the third party is the scope of the representative authority, and therefore the specific requirements for the third party to be protected are not necessarily the same. Therefore, even if the act of the representative director is recognized as acts of the representative director, if the resolution of the board of directors is necessary, and if he knew or could have known that the resolution of the board of

[1] Article 395 of the Commercial Act / [2] Article 395 of the Commercial Act / [3] Article 395 of the Commercial Act / [4] Articles 395, 209 (2), and 389 (3) of the Commercial Act

[1] [2] Supreme Court Decision 77Da2436 delivered on February 13, 1979 (Gong1979, 11790) / [1] Supreme Court Decision 84Da35816 delivered on June 11, 1985 (Gong1985, 995), Supreme Court Decision 91Da35816 delivered on July 28, 1992 (Gong192, 2547) / [2] Supreme Court Decision 86Da128 delivered on October 25, 198 (Gong198, 1467)

Book General Market of the Corporation

Cheong So comprehensive Financial Co., Ltd.

Daejeon High Court Decision 96Na3607 delivered on June 24, 1997

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

The grounds of appeal are examined.

1. On the second ground for appeal

A. According to the reasoning of the judgment below, the court below, based on the evidence adopted by the non-party 2 in its judgment, found that the non-party 2 had been registered as the representative director of the non-party 1 and the non-party 2 had been registered as the non-party 2's representative director on July 8, 192. The non-party 2, who was registered as the representative director of the non-party 1, was not registered as the non-party 1, and the non-party 2 had been registered as the non-party 2's representative director under the name of the non-party 5's representative director and was not registered as the non-party 2's representative director on the non-party 2's corporate registry for the purpose of establishing the non-party 2's corporate registry and thus, the non-party 2 was not registered as the non-party 9's representative director on the non-party 2's own corporate registry and was not registered as the non-party 1's representative director on the non-party 2's corporate registry.

B. Article 395 of the Commercial Act provides for the company's liability with respect to the act of a director who uses a name that can be recognized as having the authority to represent the company. Although this provision requires the Apparent representative director to be qualified as a director, it intends to protect a third party who trusted the appearance of the representative director in accordance with the legal doctrine or external theory by indication, the company which is responsible for such act should be held responsible for the third party acting in good faith. Thus, it is reasonable to interpret the above provision to apply mutatis mutandis to cases where the company permits a third party who is not qualified as a director to use the name of the Apparent representative director, as well as cases where the company neglects the use of the Apparent representative director's name with the knowledge of the use of the Apparent representative director's name at will without taking any measures, and only where the Apparent representative director did not know that he/she is not aware of the fact that he/she is not entitled to represent the company's name at will, the above provision should not apply to cases where he/she did not use the Fictitious representative director's name in 28197.

C. In light of the records and the above legal principles, the above fact-finding and judgment of the court below are justified, and there is no error in the misapprehension of the rules of evidence or in the misapprehension of the legal principles as to the apparent representative director, who has violated the rules of evidence or exercised his right to explanation, or who has failed to exhaust all necessary deliberations. The grounds of appeal on this point cannot be accepted.

2. On the first ground for appeal

Examining the reasoning of the judgment below in light of the records, the court below did not render any judgment as to the plaintiff's assertion that the act of creating the right to collateral security of this case by the non-party 2 was invalid without the resolution of the board of directors.

The acts of the representative director and the acts of the representative director without the resolution of the board of directors are all acts that are not the act of the representative director and the acts of the representative director shall not be responsible for the company. However, while the third party's trust is the existence of the representative authority in the former case, while the latter is the scope of the representative authority in the latter case, the specific requirements to be protected by the third party are not necessarily the same. Therefore, even if the act of the representative director is recognized as the act of the representative director, if the resolution of the board of directors is necessary and the third party who is the transaction partner knew or could have known that the resolution of the board of directors was not made in the position of the third party, it is reasonable to view that the company is exempted from liability for such act. Thus, even if the act of the representative director is recognized as the act of the representative director, it is erroneous that the court below did not make any judgment on the plaintiff's assertion that the act of the creation of the right of collateral security by Nonparty 2

However, according to the facts established by the court below, it cannot be deemed that the defendant knew or could have known the fact that the non-party 2 had restricted the exercise of its power of representation because it did not go through the resolution of the board of directors in the act of creating the right to collateral security in this case, and even according to the records, the plaintiff's assertion should be rejected since the above error of the court below did not affect the conclusion of the judgment, and there was no other evidence to acknowledge it, so the court below's failure to confirm the representative director's writing and seal, financial institution's confirmation, and omission of judgment on the argument that the non-party 2 violated the principle of prohibition of dual representation as acts contrary to the interests of this case, and therefore, it cannot be deemed a legitimate ground of appeal, and there is no illegality in the court below's failure to exercise its right of explanation. All of the grounds of appeal on this point

3. Therefore, the appeal is dismissed, and the costs of appeal are assessed against the plaintiff-Appellant. It is so decided as per Disposition by the assent of all Justices who reviewed the appeal.

Justices Park Jong-chul (Presiding Justice)