[1] Whether a mortgagee of a bill of exchange has the right to separation under the former Bankruptcy Act (affirmative)

[2] Whether a creditor may be deemed to have created a security right to the property belonging to the bankrupt estate even in cases where a bill endorsed and transferred by the debtor to a creditor for a discount loan of bill (affirmative)

[1] Article 84 of the former Bankruptcy Act (repealed by Article 2 of the Addenda to the Debtor Rehabilitation and Bankruptcy Act, Act No. 7428 of March 31, 2005) provides that a person who holds a lien, pledge, mortgage or right to lease on a deposit basis shall have the right to separation from his/her property subject to such right. Thus, a mortgagee of a bill shall be deemed a person who has the right to separation from a lien or a pledgee, etc., because he/she has the right to separation from the lien or a right to exercise the right to separation from a bill in the sense that he/she has a security right to a claim on a bill against the issuer of a bill. It is reasonable to deem that

[2] In cases where a bill endorsed and transferred by the debtor to a creditor for a discount loan is a financing bill, the lender who issued the financing bill is not liable to the beneficiary. However, the creditor who acquired the financing bill as security cannot oppose the creditor by defense that it was a financing bill issued without asking the creditor's good faith and bad faith. Therefore, even if the debtor cannot assert his/her rights on the financing bill due to the creditor's defense of the financing bill, it cannot be said that the rights on the financing bill do not belong to the bankrupt estate, and it is still deemed that the creditor established the security right on the property belonging to the bankrupt estate.

[1] Article 84 of the former Bankruptcy Act (repealed by Article 2 of the Addenda to the Debtor Rehabilitation and Bankruptcy Act, Act No. 7428 of March 31, 2005) (see Article 411 of the current Debtor Rehabilitation and Bankruptcy Act) / [2] Article 84 of the former Debtor Rehabilitation and Bankruptcy Act (repealed by Article 2 of the Addenda to the Debtor Rehabilitation and Bankruptcy Act, Act No. 7428 of March 31, 2005) (see Article 411 of the current Debtor Rehabilitation and Bankruptcy Act)

Korea Asset Management Corporation (Law Firm Pok, Attorneys Kim Gyeong-soo, Counsel for defendant-appellant)

The bankruptcy trustee in the period of counting the bankrupt corporation (Law Firm KEL, Attorney Lee Hon-soo et al., Counsel for the plaintiff-appellant)

Seoul High Court Decision 2004Na87949 Delivered on January 18, 2006

Of the judgment of the court below, the part of the judgment against the defendant as to each part of the general bankruptcy claims against the plaintiff, which the plaintiff acquired by transfer and return to the Seoul High Court as to the part of the promissory note No. 10 billion won in the face value of each general bankruptcy claim against the defendant as to the calculation of the amount of the plaintiff's financial claim, and this part of the case is remanded to the Seoul High Court. The defendant's remaining appeal is dismissed.

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

Examining the reasoning of the judgment below, the court below rejected the defendant's assertion that, as the plaintiff acquired the right of separation under the real estate disposal trust contract with the Korea Real Estate Trust Co., Ltd. (hereinafter referred to as the "Korea Real Estate Trust Co., Ltd.") which is a real estate collateral (hereinafter referred to as the "Korea Real Estate Co., Ltd.") at the time of transfer of one half of the amount of the right of separation under the same real estate disposal trust contract (hereinafter referred to as the "right of separation"), the above right of separation can not be deemed as a bankruptcy claim because the above right of loans which are the bill discount can not be recognized as a claim of general bankruptcy claim, the court below rejected the conclusion of the judgment, based on the comprehensive consideration of the newly admitted evidence, that the transfer of the right of separation under the trust agreement with the Korea Real Estate Trust Co., Ltd. (hereinafter referred to as the "Korea Real Estate Trust Co., Ltd.") can not be deemed as a new right of separation, which is a sub-pledge's new right of separation, which is a sub-right of the pledge right of this case.

In light of the records, the judgment of the court below is just, and there is no error in the misapprehension of legal principles as to the transfer of pledge rights or the right to foreclose outside bankruptcy, or in violation of the rules of evidence.

2. Regarding ground of appeal No. 2

Where a debtor obtains a loan from a financial institution at a discount from a financial institution using a bill issued by a third party, the debtor shall be liable to the financial institution as an endorser of the bill along with his/her loan obligations, and the bill issued by a third party transferred by means of endorsement shall be deemed to have established a security right on the bill in order to secure the debtor's loan obligations. Article 84 of the former Bankruptcy Act (repealed by Article 2 of the Addenda to the Debtor Rehabilitation and Bankruptcy Act, Act No. 7428, Mar. 31, 2005) provides that a person who has a lien, pledge, mortgage, or right to lease on a deposit basis shall have the right to separation as to his/her property. Thus, the mortgagee of the bill shall be deemed to have the right to separation under the Bankruptcy Act because he/she has a security right to the debtor's claim on the bill issued by the bill, and it shall not be deemed to be the person who has the right to exercise the right to separation under the Debtor Rehabilitation and Bankruptcy Act,

In addition, in case where a bill endorsed and transferred by the debtor to the creditor for a discount loan is a financing bill, the lender who issued the financing bill is not liable to the lender. However, the creditor who acquired the financing bill as security cannot set up a defense against the creditor that it was a financing bill issued without compensation without asking the creditor's good faith and bad faith. Therefore, the value as a security right of the financing bill exists inevitably. Therefore, even if the debtor cannot assert the right on the financing bill due to the creditor's defense of the financing bill against the lender, it cannot be said that the right on the financing bill belongs to the bankrupt estate, and it is still deemed that the creditor established the security right on the property belonging to the bankrupt estate.

In this case, the Defendant asserted that, from the initial date of calculation, three kinds of notes or one promissory note number Co., Ltd. (hereinafter “Korea-China”) issued at the face value of 10 billion won in the issuance of a promissory note (2/(2/3 omitted), which is the cause of the issuance of a note number Co., Ltd. (hereinafter “Korea-China Industries”) or one promissory note number Co., Ltd. (3/3 omitted) issued at the time of the issuance of a note number Co., Ltd. (hereinafter “Korea-China”) (3/3 omitted). The Defendant asserted that, since the Plaintiff, who was ordered to take over three types of notes and one kind of notes, received loans from the Korea-China Industries and the Korea-China Comprehensive Finance Co., Ltd. (hereinafter “Korea-China”) as collateral for a bill of exchange, the amount of loans from the above three types of notes and the amount of loans from each of the above promissory note are not subject to the right of separation as collateral for each obligee, the lower court rejected each of the above loans from each of the above three types of notes as collateral.

However, according to the legal principles as seen earlier, even if a financing bill is a financing bill, the lender who issued the financing bill cannot set up a defense against the third party who acquired the financing bill as a security without asking the third party's good faith and bad faith. Thus, even if the debtor cannot assert rights on the financing bill, the above financing bill belongs to the bankruptcy estate as long as it is recognized as a security right. Therefore, in calculating the calculation of the debtor, the court below held that the plaintiff cannot be deemed to have the right to separation of rights on each of the above financing notes because each of the above promissory notes belongs to the bankruptcy estate, since the court below did not have any factual rights such as the underlying claim or the claim for payment of the promissory notes. Therefore, it is erroneous in the misapprehension of the legal principles as to the transfer of security on the financing bill. The defendant's appeal pointing this out has merit.

3. As to the third ground for appeal

According to the judgment of the court below, the court below rejected the defendant's assertion that the claim for discount loans in bills was extinguished due to the set-off with each deposit claim held against Han-sung and Han-sung, Inc. (hereinafter "Korea-Japan-Japan-U.S."), or Korea-U.S. General Finance Co., Ltd. (hereinafter "Korea-U.S."), on the initial date of the above transfer notice, and the claim for Han-U.S. loan loans in bills cannot be set-off against the claims already transferred after Han-U.S. transfer of the claim for Han-U.S.-U.S. loan in exchange for Han-U.S. and Han-U.K.-U.S. loan in exchange for Han-U.S.-U.S. loan in exchange for the initial date of Han-U.S. Special Finance Co., Ltd. (hereinafter "Korea-U.S.-U.S. loan in exchange for the initial date of the transfer notice.

In addition, the court below held that the above argument is without merit since the plaintiff's transfer of claims from gold companies, such as Korean style gold, and even after the notice of transfer was given, the offset between gold companies and debtors was recognized as a whole and deducted from the total amount of claims. The plaintiff's rejection of some of the set-off details is contrary to the principle of gold and the principle of trust in the case of the plaintiff's claim that the time of partial set-off would be at the latest after the issue of the time of individual transfer of claims is in violation of the principle of set-off or the principle of trust. The court below found the defendant's assertion that the plaintiff's claim as bankruptcy claim against the defendant only after receiving the payment of each bill of exchange provided from the calculation of consideration-type gold after the notice of the transfer of claims was given, and the remaining amount after deducting KRW 300 million was deducted from the total amount of consideration-type gold after the notice of the transfer of claims was made. In light of the records, the judgment of the court below is just and there is no error in the misapprehension of legal principles as to gold and the principle of trust.

The Supreme Court precedents cited in the grounds of appeal are inappropriate to be invoked in this case, since they differ from this case.

4. As to the fourth ground for appeal

In light of the reasoning of the judgment below and the records, the court below is just in holding that the calculation of the admitted evidence is liable to pay the plaintiff damages for delay in accordance with the interest rate set by the Dongan Bank Co., Ltd. as stated in its judgment, and there is no error of law such as misunderstanding of legal principles as to the right

5. Conclusion

Therefore, among the judgment of the court below, the part against the defendant as to each part of the general bankruptcy claims against which the plaintiff is liable for the calculation of the set-off of the set-off of the set-off of the set-off of the set-off of the set-off of the set-off of the set-off of the set-off of the set-off of the set-off of the set-off of the face value of the set-off of the set-off of the set-off of the set-off of the set-off of the set-off of the set-off of the set-off of the set-off of the set-off of the set-off of the set-off of the set-off of the set-off of the set-off of the set-off of the set-off of the set-off of the set-off of the set-off of the set

Justices Cha Han-sung (Presiding Justice)