A. The purport of the arbitration clause which provides for "legal disputes which cannot be resolved by the parties to the contract" as the subject of arbitration under the contract for transfer of business

B. Whether the dispute about the existence of tort liability is included in the subject matter of arbitration as stipulated in the above arbitration clause in a case where warranty liability and tort liability are concurrent due to the defect of the subject matter of transfer in the above “A” (affirmative)

(c) The validity of the arbitral award in which only two arbitrators participate in the case where the parties have consented to the conclusion of the hearing with the absence of one of three arbitrators

A. In a case where the arbitration clause of the business transfer contract provides "legal dispute which cannot be settled between the parties regarding the contents of this contract" as a subject of arbitration, the term "legal dispute concerning the contents of this contract" should be deemed to include not only a dispute on the meaning of the contents of this contract, but also a dispute directly related to the establishment and implementation of the contents of the contract and its existence and validity, or a dispute closely related thereto.

B. In the event of damage caused by hidden defects in the subject matter of transfer, the warranty liability, which the transferor bears against the assignee, is an incomplete performance liability and is directly related to the implementation of the content of this contract. In a case where the warranty liability and tort liability are concurrent based on the same factual basis, the dispute over the existence of tort liability is closely related to the implementation of the content of this contract, and it is reasonable to view that the dispute is included in the subject matter of arbitration stipulated in the arbitration clause of the above

C. Even if the parties agree on the process of hearing and the closure of hearing with the absence of one of three arbitrators on the hearing date, it cannot be deemed that the remaining two arbitrators have consented to the arbitral award. In addition, if there is no other evidence to find that the parties consented to the arbitral award by the two arbitrators as above, the arbitral award made by only two of the three arbitrators without the consent of the parties shall not be revoked because the arbitral proceedings under Article 13(1)1 of the Arbitration Act are not in compliance with the Arbitration Act or the arbitration agreement.

(b)Article 580(1) and Article 750(c) of the Arbitration Act; Article 13(1)1 of the Arbitration Act;

Korea Heavy Industries Co., Ltd. (Law Firm Central Patent Office, Attorneys Cho Tae-tae et al., Counsel for the defendant-appellant)

Geumsung Electric Co., Ltd., Counsel for the defendant-appellant-appellant and 6 others, Counsel for the plaintiff-appellant-appellant-appellant-appellee

Seoul High Court Decision 90Na50902, 90Na50919 (Counterclaim), April 12, 1991

The appeal is dismissed.

The costs of appeal are assessed against the Defendant (Counterclaim Plaintiff).

Defendant-Counterclaim Plaintiff (Defendant-Counterclaim Plaintiff, hereinafter Defendant-Counterclaim Plaintiff)’s ground of appeal is examined.

1. According to the reasoning of the judgment below, the court below acknowledged that the plaintiff's non-party 1's non-party 1's non-party 2's non-party 1's interest in the sale of the above non-party 1's underground floor and the non-party 2's interest in the transfer of the above non-party 1's industrial complex and its affiliated buildings and rights were transferred to the defendant on October 10, 1983. The non-party 1's interest in the transfer of the above non-party 2's non-party 1's non-party 2's interest in the non-party 1's claim against the defendant's non-party 1's non-party 2's non-party 1's interest in the transfer of the above non-party 1's underground floor and the non-party 1's interest in the non-party 2's non-party 9's non-party 1's interest in the non-party 1's non-party 9's interest in the plaintiff 1'

2. According to the arbitration clause of Article 14 of the Business Transfer Agreement (Evidence 2 of the A), "legal dispute which cannot be resolved by the parties to the contract" is subject to arbitration. The legal dispute on the contents of this contract is not only a dispute on the meaning of the contract but also a dispute directly related to or closely related to the formation and implementation of the contract and the existence of its validity.

As in the instant case, the warranty liability, which the transferor bears against the assignee, is an incomplete performance liability, and is directly related to the implementation of the content of this contract. In a case where the warranty liability and the tort liability are concurrent based on the same factual basis, the dispute over the existence of tort liability is a dispute closely related to the implementation of the content of this contract, and it is reasonable to view that the dispute is included in the subject matter of arbitration as stipulated in the instant arbitration clause.

The lower court determined that a dispute regarding tort liability was a dispute which could not be predicted by the parties at the time of the contract, on the ground that the Plaintiff and the Defendant agreed to exempt the warranty liability, but it is reasonable to view that tort liability in competition with the warranty liability could also be predicted if the extent of an agreement to exempt the warranty liability is the same. Therefore, it is difficult to say that a dispute could not be predicted even if the parties to the household did not predict the agreement due to negligence and did not cause the agreement to exempt the tort liability under

After all, the judgment of the court below is erroneous in the misapprehension of the interpretation of the subject matter of arbitration as stipulated in the above arbitration clause, which affected the conclusion of the judgment, and there is a reason to point this out.

3. However, according to the facts duly established by the court below, the 14th hearing date of the arbitration of this case was commenced on January 11, 1990 and concluded after the hearing. Among three arbitrators, the non-party 3 did not appear on the above hearing date and died on the same day at around 23:00, and there was no agreement between three arbitrators from the date of the hearing to the date of the arbitration. According to the evidence 5-14 of the above evidence employed by the court below, the parties did not appear on the hearing date and agreed to the closure of the hearing, but there is no other evidence to acknowledge that the parties agreed to the arbitration by the two arbitrators as above.

Thus, the arbitral award of this case is not exempt from its revocation because only two arbitrators among three arbitrators without the consent of the parties participate, and the arbitral procedure under Article 13 (1) 1 of the Arbitration Act is not governed by the Arbitration Act or a contract of arbitration.

The judgment of the court below that determined the above purport is justifiable, and there are errors in the reasoning of the court below, but the conclusion that ordered the revocation of the above arbitral award is justified and the judgment below is bound to be maintained.

4. Therefore, the appeal shall be dismissed, and all costs of appeal shall be assessed against the losing party. It is so decided as per Disposition by the assent of all participating Justices.

Justices Song Man-man (Presiding Justice)