(a) Resolution of the board of directors or the transfer of basic property of an educational foundation without permission from the supervisory authority;

(b) Whether the highest purchaser in the auction procedure for the basic property of a school may exercise in subrogation the supervisory authority an application for permission concerning the disposition of the basic property;

A. According to Articles 28(1) and 16 of the former Private School Act (amended by Act No. 4226 of Apr. 7, 1990), when a school foundation transfers its basic property, it shall obtain permission from the supervisory authority through a resolution of the board of directors. If it is transferred without a resolution of the board of directors or permission from the supervisory authority, it shall be null and void regardless of whether it is based on the school foundation’s intention or based on compulsory auction procedure.

B. In the procedure for compulsory auction, the highest bidder can not exercise in subrogation of the school juristic person, which is the execution obligor, the right to obtain permission of auction on the date of auction, but cannot be considered to have any right against the execution obligee or the debtor. Thus, the highest bidder cannot exercise in subrogation of the school juristic person which is the execution obligor the application for permission of disposition of

A.B. Article 28(1) and Article 16(2) of the former Private School Act (amended by Act No. 4226 of Apr. 7, 190), Article 627 of the Civil Procedure Act

[Plaintiff-Appellant] Plaintiff 1 and 1 other (Law Firm Gyeong, Attorneys Park Jae-soo et al., Counsel for plaintiff-appellant)

Plaintiff 1 and five others, Plaintiffs et al., Counsel for the plaintiff-appellant-appellee and two others

Attorney Lee Jae-hoon, Counsel for the plaintiff-appellant in Busan Special Metropolitan City

Busan High Court Decision 93Gu715 delivered on October 6, 1993

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

We examine the grounds of appeal.

According to Articles 28(1) and 16 of the former Private School Act (amended by Act No. 4226 of Apr. 7, 1990), where a school foundation transfers its basic property, it shall obtain permission from the supervisory authority through a resolution of the board of directors. If it is transferred without the resolution of the board of directors or the permission of the supervisory authority, it shall be null and void regardless of whether it is based on the school foundation’s intent or based on the compulsory auction procedure (see Supreme Court Decision 93Da42993 delivered on Jan. 25, 1994).

In addition, in the procedure of compulsory auction, the highest bidder only has the right to obtain permission of auction on the date of auction, and it cannot be said that the highest bidder has any right to directly execute creditor or debtor. Therefore, the highest bidder cannot exercise the right to request permission of disposition of fundamental property on behalf of the school juristic person which is the execution debtor.

Therefore, the decision of the court below that the plaintiffs who are only the successful bidder in the compulsory auction procedure for the basic property for profit of school juristic persons cannot apply to the supervisory authority for the permission is just, and there is no error in the misapprehension of legal principles, and so long as the plaintiffs do not have the right to apply for the permission, the ground that there was misunderstanding of legal principles as to the period of application for permission or the decision of permission of successful bid cannot be the ground for the decision of the court below. The argument is without merit.

Therefore, all appeals are dismissed, and the 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 Lee Jae-soo (Presiding Justice)