[1] The legal nature of a novation and whether a renewal contract may be rescinded on the grounds of non-performance of a new obligation (negative)

[2] Whether it is possible to restore old bonds by cancelling an open contract by agreement (affirmative)

[1] A novation agreement is an act of disposing of the establishment of a new claim and the extinguishment of a old claim, and the effect of a new claim is completed when a new claim is established, and there is no room for the issue of performance of a new contract itself, and thus, the renewal agreement cannot be rescinded on the ground of nonperformance of a new obligation established by a novation.

[2] Under the principle of freedom of contract, it is possible for at least the parties to recover the old claim by cancelling the agreement after the formation of a novation contract.

[1] Articles 500 and 544 of the Civil Act / [2] Articles 500 and 543 of the Civil Act

[1] Supreme Court Decision 80Da2050 delivered on November 11, 1980

[Judgment of the court below]

Defendant (Attorney Cho Jae-soo, Counsel for the defendant-appellant)

Busan High Court Decision 2000Na4340 delivered on October 2, 2002

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

According to the reasoning of the judgment below, the court below acknowledged facts based on the evidence of employment, and determined that the exchange contract of this case was restored because the final agreement between the plaintiff and the defendant was implicitly rescinded, based on the above fact-finding.

A novation agreement is a disposal act that establishes a new claim and terminates the old claim, and the effect of a new claim is concluded, and there is no concern about the performance of the renewed contract itself, so the renewed contract cannot be rescinded for the reason of nonperformance of the new obligation established by the novation (see Supreme Court Decision 80Da2050, Nov. 11, 1980). However, it is possible between the parties to restore the old claim by cancelling the renewed contract after the formation of the renewed contract under the principle of freedom of contract.

In light of the above legal principles and records, the fact-finding and judgment of the court below are just and acceptable, and there are no errors in the misapprehension of facts against the rules of evidence or misapprehension of the legal principles as to light contracts, or violation of the judgment of the Supreme Court.

Therefore, the appeal is 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 Song Jin-hun (Presiding Justice)