[1] The legislative purport of Article 240 (2) of the Company Reorganization Act that provides that the reorganization plan shall not affect any extent of the guarantor's liability

[2] The validity of the provisions of the reorganization program to exempt the guarantor's liability guaranteed by the reorganization company (negative)

[3] The case affirming the judgment of the court below which held that a reorganization security holder cannot be deemed to have made an individual declaration of intent to exempt a guarantor from a guaranteed obligation solely on the ground that he consented to the reorganization program including the exemption provision from guarantee at the meeting of interested persons

[1] The company reorganization procedure aims at achieving the purpose of reorganization and re-resolution of a company faced with insolvency due to financial deficiencies in the needs of public interest, which makes it possible for the company to continuously enjoy profits from its business in a state where the company is low enough to reduce its liabilities or responsibilities to be borne by it. As such, the company's obligations to be borne by the reorganization creditors are subject to extensive changes such as discharge, and it is nothing more than the original purpose of the company reorganization procedure to achieve the company reorganization procedure, but it is nothing more than to the original purpose of the company reorganization procedure to reduce its obligations to the reorganization creditors such as the guarantor, etc., and if the reorganization plan is completed or reduced equally, the rights of the reorganization creditors such as the guarantor, etc. other than the extinguishment or reduction of the rights of the company by the reorganization plan, it can be an obstacle to the reorganization reorganization and re-issuance of the company, which is beyond the direct scope of the reorganization and re-determination of the company, and it does not affect the reorganization plan.

[2] The same content as the exemption of the guarantor's liability guaranteed by the reorganization company is not of the nature that can be determined by the reorganization plan, and even if the contents as such are stipulated by the reorganization plan, the part shall not be effective as the reorganization plan.

[3] The case affirming the judgment of the court below which held that the reorganization creditor or security holder may not be deemed to have expressed his/her intent to exempt the guarantor from the guaranteed obligation solely on the ground that the reorganization program, including the provision exempted from the guarantee, cannot be deemed to have been approved at the meeting of the persons concerned, on the ground that the reorganization creditor or security holder, even though he/she consented to or consented to the reorganization program, cannot be deemed to have expressed his/her intent to have had a judicial effect as to the individual contents stated in

[1] Articles 1 and 240 (2) of the Company Reorganization Act / [2] Article 240 (2) of the Company Reorganization Act / [3] Articles 205 and 240 (2) of the Company Reorganization Act, Article 105 of the Civil Act

[1] Constitutional Court en banc Order 91Hun-Ga8, 9 decided June 26, 1992 (Hun-Ga4, 323)

Korea Development Bank (Law Firm Jeong, Attorneys Choi Jin-seok et al., Counsel for the defendant-appellant)

Defendant (Law Firm Han-soo, Attorneys Song Du-hwan et al., Counsel for the defendant-appellant)

Seoul High Court Decision 2005Na17619 delivered on July 21, 2005

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

1. As to the grounds of appeal Nos. 1 and 3

In order to achieve the purpose of reorganization and re-resolution of a company that faces bankruptcy due to financial deficiencies in the needs of public interest, the company's company reorganization procedure is to create conditions under which the company can continue to enjoy profits from its business in a state where it is unfilled so that it can reduce its liabilities or responsibilities that the company bears in order to be borne by the company. Therefore, the company's obligations to be borne by the reorganization creditor are subject to broad changes, such as exemption from liability, and it is entirely irrelevant to the original purpose of the company reorganization procedure to achieve the company reorganization procedure.

In addition, if the reorganization creditor's right against the company is extinguished or reduced by the reorganization plan, and the right against the guarantor, etc. is also extinguished or reduced as well, this would result in compelling the reorganization creditor to make a unilateral sacrifice beyond the extent necessary directly for the reorganization reorganization reorganization of the company, which would result in undermining the reorganization of the company. In addition, Article 240 (2) of the Company Reorganization Act provides that the reorganization plan shall not affect the scope of liability of the guarantor, etc. (see Constitutional Court Order 91HunGa8, June 26, 1992, Supreme Court Order 91HunGa8, June 26, 1992).

In light of such legislative intent, the contents such as exempting the guarantor from the liability of the guarantor that guarantees the obligations of the reorganization company are not of the nature that can be determined by the reorganization plan, and even if such contents are stipulated by the reorganization plan, such contents are not effective as the reorganization plan.

In addition, Article 240 (2) of the Company Reorganization Act cannot be deemed to prohibit the reorganization creditor or security holder from adjusting their interests by exempting him from liability to the guarantor of the company. Thus, the court below's rejection of the defendant's assertion by deeming the nature of Article 240 (2) of the Company Reorganization Act as a mandatory provision is somewhat inappropriate. However, it is just in accordance with the above legal principles to determine that the part of the reorganization plan in this case where the reorganization obligation is fully repaid, the obligation of the guarantor of the company shall be extinguished as the reorganization plan, and contrary to the allegations in the grounds of appeal, there is no error of law by misapprehending the legal principles as to the validity of

On the other hand, the argument in the grounds of appeal that the approved reorganization program has the same effect as a final and conclusive judgment, and that the case concerning the validity of the party members' decision to approve the reorganization program only pertains to the case where the decision to approve the reorganization program becomes final and conclusive, and that part of the reorganization program cannot be applied to this case where the original contents are

2. Regarding ground of appeal No. 2

Even if a reorganization creditor or security holder consented to or consented to the reorganization programs, it cannot be deemed that the reorganization creditor or security holder generally expresses his/her intent to bring about legal effects to the individual contents stated in the reorganization programs, unless there are special circumstances.

In the same purport, the court below is just in holding that the Plaintiff’s consent to the reorganization program including the exemption clause from guarantee at the meeting of interested persons cannot be deemed to have made an individual declaration of intent against the guarantor. Contrary to the allegations in the grounds of appeal, the court below did not err by misapprehending the legal principles on the interpretation of declaration of intent

3. Conclusion

Therefore, the appeal is dismissed. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Zwon (Presiding Justice)