[1] The meaning of transfer of business and the standard for its determination

[2] The criteria for determining whether a transferee of business under Article 42 (1) of the Commercial Code belongs to the trade name

[3] The case holding that since the trade name before and after the transfer of the business and the trade name of the business owner are common in the main part, the business owner's liability for the transferee of the business is recognized as being common in the main part

[1] The term "business" under Article 42 (1) of the Commercial Act refers to a functional asset as an organic integration organized for a certain business purpose. The term "functional asset as an organic integration" means that the facts with tangible and intangible properties and economic values, which form a business, function as the source of revenue by systematically combining each other, and that the functional asset as the source of revenue that systematically combines as such, becomes an object of transaction like one goods. Thus, the issue of whether a business transfer exists shall be determined depending on whether the transferee continues to engage in the business activity such as the transferor, which is the source of revenue organized.

[2] Article 42(1) of the Commercial Act provides that a transferee who continues to use a trade name is liable to repay debts arising from the business of a transferor to a transferee who continues to use the transferor's business. Generally, the debtor's business credit is most substantially secured by the debtor's business property, even though the transferor's business credit is not succeeded to, and in cases where the transferee loses an opportunity to pursue debts to the creditor because the fact of the transfer of business or the failure to succeed to debts became difficult to prove externally, regardless of the fact of the transfer of business or the transfer of business makes it difficult to use the trade name continuously, and thus, the transferee shall also be held liable to repay debts. Thus, if the trade name used by the transferor and the transferee

[3] The case holding that since the trade name used by the transferor of business and the trade name used by the transferor of business are common in the main part, the business owner's liability for the transferee of business due to mutual use is recognized as being common in the main part

[1] Article 42 (1) of the Commercial Act / [2] Article 42 (1) of the Commercial Act / [3] Article 42 (1) of the Commercial Act

[1] [2] Supreme Court Decision 88Da10128 delivered on December 26, 1989 (Gong1990, 354) / [1] Supreme Court Decision 95Da7987 delivered on July 25, 1995 (Gong1995, 2947) Supreme Court Decision 96Nu19314 delivered on April 25, 1997 (Gong1997Sang, 1657Sang, 1657), Supreme Court Decision 96Da2644 delivered on June 24, 197 (Gong1997Ha, 2263), Supreme Court Decision 97Da35085 delivered on November 25, 197 (Gong1998, 198Sang, 3] Supreme Court Decision 97Da198788 delivered on March 28, 197 (Gong1988, 197)

Plaintiff

National concrete Industry Co., Ltd. (Attorney Lee Young-soo et al., Counsel for the defendant-appellant)

Seoul District Court Decision 95Na32159 delivered on December 6, 1995

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

The business under Article 42(1) of the Commercial Act refers to a functional asset as an organic integration organized for a specific business purpose (see Supreme Court Decision 88Meu10128, Dec. 26, 1989). The functional asset as an organic combination refers to a combination of tangible and intangible property and economic value that functions as a source of profit, and the functional asset as a source of profit that is an organic combination of economic value becomes an object of transaction like a single goods. Thus, the issue of whether a transfer of business can be viewed as a source of profit should be determined depending on whether the transferee continues to conduct the same business as that of the transferor after being transferred a functional asset as an organic organized source of profit (see Supreme Court Decision 97Da35085, Nov. 25, 1997). Since the above provision provides that if the transferee continues to use the transferor’s trade name to the transferee, the transferee is not liable for the mutual debt obligations arising from the business transfer to the transferee, it should not be deemed that the transferee becomes liable for the mutual debt transfer to the transferee.

According to the reasoning of the judgment of the court below, the court below held that the defendant company (the change of name from the so-called "mar concrete company as now in September 8, 1994) was transferred to the defendant company for business purposes on August 2, 1993, such as receiving the registration of transfer of the ownership to the factory building, etc. from the so-called "Jar concrete company" on the grounds of sale and purchase on July 19, 1993. On August 4, 1998, the company changed the trade name and representative of the so-called "mar concrete company" under the Industrial Placement and Factory Construction Act to that of the defendant company. The directors of so-called "mar concrete" were registered as directors of the defendant company, and part of the employees of so-called "mar concrete" were transferred to the defendant company as they were transferred to the defendant company. In light of the fact that the defendant company paid on behalf of the so-called "mar concrete company's main obligation," the defendant company's main business relationship with the defendant company's main business partners and its existing business partners.

If the facts are identical, in light of the above legal principles, the defendant company should be deemed to continue to use the trade name by taking over the business of the Pakistan. Therefore, the decision of the court below to the same purport is just, and there is no error of law by misunderstanding the legal principles as alleged in

In addition, according to the records, the defendant company did not assert that part of the check amount was repaid, and there is no evidence to acknowledge this, so there is no illegality in the judgment below as alleged in the grounds of appeal. Therefore, all of the grounds of appeal are not accepted.

Therefore, the appeal is dismissed and the costs of appeal are assessed against the losing party. It is so decided as per Disposition.

Justices Lee Don-hee (Presiding Justice)