Plaintiff (Law Firm National, Attorneys Kim Ho-sung et al., Counsel for plaintiff-appellant)

Defendant (Law Firm Sejong, Attorneys Park Jong-soo et al., Counsel for the defendant-appellant)

October 30, 2008

Seoul Southern District Court Decision 2007Da14241 decided Dec. 28, 2007; 2007Kadan57316 decided Dec. 28, 2007

1. The plaintiff (Counterclaim defendant)'s appeal on the principal lawsuit is dismissed.

2. A. At the preliminary claim of the Plaintiff (Counterclaim Defendant) added at the trial, the Defendant (Counterclaim Plaintiff) paid 10 million won to the Plaintiff (Counterclaim Defendant) and 5% per annum from March 1, 2007 to November 27, 2008, and 20% per annum from the next day to the day of complete payment.

B. The plaintiff (Counterclaim defendant)'s remaining preliminary claims are dismissed.

3. The part against the plaintiff (Counterclaim defendant) among the part against the counterclaim in the judgment of the court of first instance is revoked, and the defendant (Counterclaim plaintiff)'s counterclaim claim corresponding to the revoked part is dismissed.

4. The defendant-Counterclaim plaintiff's counterclaim added in the trial is dismissed.

5. The total costs of the lawsuit shall be four minutes in total, including the principal lawsuit and the counterclaim, and one of them shall be borne by the Plaintiff (Counterclaim Defendant) and the remainder by the Defendant (Counterclaim Plaintiff).

6. Paragraph 2 can be provisionally executed.

1. Purport of claim

A. Main suit: The defendant (Counterclaim plaintiff; hereinafter the defendant only) paid 100,000,000 won to the plaintiff (Counterclaim defendant; hereinafter the plaintiff only) and 20% interest per annum from the day following the day when the copy of the complaint of this case was served to the day of complete payment (the plaintiff filed a claim for restitution on the ground of the initial cancellation of the contract, and added the claim for restitution of unjust enrichment due to the cancellation of the contract to the preliminary one at the trial).

B. Counterclaim: The plaintiff delivered a copy of the counterclaim to the defendant as to KRW 141,050,000 and KRW 100,000,000 among them, and with respect to KRW 41,050,00,000, the plaintiff paid 20% interest per annum from the day following the day when the application for claiming the counterclaim and for changing the cause of the counterclaim was served to the day of complete payment (the defendant added a claim for damages at the trial).

2. Purport of appeal

A. Main Action: Revocation of the part concerning the main action of the judgment of the court of first instance, and the same as that in the purport of the main action.

B. Counterclaim: The part against the plaintiff among the part concerning the counterclaim in the judgment of the court of first instance is revoked, and the defendant's counterclaim claim corresponding to the revoked part is dismissed.

A principal lawsuit and a counterclaim shall be deemed simultaneously.

1. Basic facts

The following facts do not conflict between the parties, or may be acknowledged by taking into account the following facts: Gap evidence 1, Gap evidence 2-1, Gap evidence 2-3, Gap evidence 4, Gap evidence 5-1 through 4, Eul evidence 1, Eul evidence 3, non-party 1's testimony of the court of first instance, and the whole purport of the pleadings.

A. On November 23, 2005, the non-party 2 acquired a license for electrical construction business and communications construction business from the non-party 1 corporation by dividing the non-party 1 corporation's electrical construction business and communications construction business into the non-party 2 corporation, but on June 13, 2006, the divided portion of the electrical construction business was merged with the defendant.

B. On July 18, 2006, the Plaintiff engaged in the electrical construction business, etc. entered into a contract for the transfer and acquisition of a corporation with the content that the Plaintiff would acquire the right to registration (license) of the electrical construction business from the Defendant as a broker of Nonparty 1 who is engaged in the business of acquisition, merger, brokerage, etc. from the Defendant through a corporate division and merger (hereinafter “instant contract”). The written draft of the contract was prepared by Nonparty 1, and its main contents were as follows.

(a) Article 1: Amount of transfer and acquisition, and method of payment;

The transfer amount shall be KRW 20 million, the down payment shall be paid at the time of a contract, and the intermediate payment of KRW 70 million shall be paid up to August 11, 2006, and the remainder KRW 100 million shall be paid at the same time with the merger documents and all other documents necessary for the future electrical construction business within three days after the notice is completed.

(2) Article 2: It excludes all the property and liabilities of the transferred or acquired object, and shall be succeeded only to all the qualifications, such as the registration right of construction business (license), performance records, and share of investment in the mutual aid association.

(3) Article 4: Transfer or acquisition shall be made by means of a corporate merger or acquisition through division.

(4) Article 8: Details of this Agreement, defects guarantee, principal obligation, guaranteed obligation, taxes and public charges, etc., other than those of this Agreement, shall be prepared and promised to be performed jointly and severally.

(5) Article 11: In the event that a merger by split is not possible on the ground of the third cause, not the grounds for disqualification of the plaintiff and the defendant, this contract shall become null and void, and the defendant shall promptly return the total amount of the transfer money received to the plaintiff

C. On July 19, 2006, the Plaintiff paid the Defendant the down payment of KRW 30 million and the intermediate payment of KRW 70 million on August 11 of the same year.

D. On August 11, 2006, the defendant, non-party 2, the representative director of the defendant, and non-party 3, the managing director of the defendant, prepared a letter (Evidence No. 3) stating that, pursuant to Article 8 of the contract of this case on August 11, 2006, the following matters shall be jointly and severally liable and dealt with, and received the authentication on September 4

(1) The payment of taxes and public charges under a corporation and license until the transfer or acquisition is completed shall be responsible.

(2) If any defect in the constructed electrical construction occurs, it shall be immediately resolved so as not to cause the transferee’s damage.

(3) The corporation and the joint guarantor shall be responsible for and resolve other debts incurred, such as joint and several sureties and warranty, and the wages and all other accounts payable to officers and employees.

(4) A corporation and construction business shall be fully responsible and treated in return for promising that there is no civil or criminal problem up to now.

E. Meanwhile, the non-party 1 corporation was suspended from current account transactions on July 4, 2005, and the non-party 1 corporation, the creditor of the non-party 1 corporation, filed a lawsuit against the defendant and the non-party 2 corporation on August 4, 2006 against the defendant and the non-party 2 corporation for the payment of the face value of 20,295,000 promissory notes issued by the non-party 1 corporation. The defendant who received a copy of the complaint on the 14th of the same month notified the plaintiff that the lawsuit was brought.

F. On August 31, 2006, the Plaintiff pointed out that a bill (including checks) issued by the bank to the Defendant in the name of Nonparty 1 was already about 50-60 copies, and demanded the Defendant to verify the amount of the bill issued by Nonparty 1 and the amount of the non-party 1’s default, and against this, the Defendant is sufficient to have jointly and severally guaranteed by the representative director and the officer as stated in the foregoing paragraph D. If the problem arises, it is sufficient that the representative director and the officer jointly and severally guaranteed the obligation of the non-party 1, thereby refusing the demand for the provision of the security while complying with the contract, and

G. At the time of a merger between the non-party 2 and the non-party 1 corporation, the non-party 1 corporation succeeds to all the rights and obligations regarding the property (business) divided from the non-party 1 corporation by a special resolution of the general meeting of shareholders; however, the defendant did not submit any data on August 17, 2006 as to the fact that the non-party 2 corporation determined that the non-party 1 corporation bears only the obligations concerning the invested business among the obligations of the non-party 1 corporation prior to the division. The defendant, on August 17, 2006, pursuant to Articles 530-9(4) and 527-5(1) of the Commercial Act, upon the division of the part of the defendant's electrical construction business and the merger between the plaintiff, the non-party 2 corporation should submit them in daily newspapers. However, the defendant did not submit any data on the fact that each

H. On September 14, 2006, the said claim was withdrawn on the said Telecom Co., Ltd.

I. On January 18, 2007, the Plaintiff sent a written statement demanding the Defendant to cancel the instant contract and return the money already paid.

2. The parties' assertion

A. The plaintiff's assertion

The plaintiff, when he takes over a license for the electrical construction business through a merger after division, concluded the contract of this case with the intention to take over only the company's obligation prior to the division pursuant to Article 530-9 of the Commercial Act with the intention to take over only the company's obligation before the division, and stated that the defendant's property and obligation should be excluded from the transfer subject to the license, etc. under the contract, and subsequently he became aware that the defendant and the non-party 1 corporation's obligation should be jointly and severally liable for the non-party 1 corporation's obligation pursuant to the above provisions of the Commercial Act. In fact, the plaintiff filed a lawsuit against the creditor of the non-party 1 corporation, which is the cause of the lawsuit, and therefore, the above circumstances are considered to be "where the merger after division is not possible due to the cause of the contract of this case, the defendant is obligated to return the price of KRW 100 million received pursuant to the above Article 11 of the contract of this case. (2) In addition, the plaintiff revoked

B. Defendant’s assertion

The defendant, on the premise that the grounds alleged by the plaintiff do not constitute a ground for rescission of contract, and on the premise that the plaintiff is bound to take over the obligation under the Commercial Act, set up a letter of joint and several surety in Article 8 of the contract so as not to cause damage to the plaintiff if the plaintiff bears the obligation, and the defendant submitted each letter (Evidence B No. 3) in accordance with Article 8 of the above contract, so there was no error in concluding the contract. Accordingly, the contract in this case is still valid and the contract in this case is asserted to be valid, and the defendant additionally claimed compensation for damages equivalent to the expenses incurred by the plaintiff in order to maintain the conditions of qualification

3. Judgment by issue

(a) Legal relations of the merger by division;

In full view of the provisions of Article 530-9(1), (2), and (3) of the Commercial Act, in cases where a company divided or divided and merged continues to exist after division, the Commercial Act provides that, in principle, a company established by division and a company established by division (hereinafter “newly established company”) or a company established by division and merger (hereinafter “existing company”) shall be jointly and severally liable for the obligations of the company prior to division or merger after division to protect creditors of the divided company. However, if the principle of joint and several liability is strictly strict, it may act as an element preventing the use of the company division system, thereby preventing the newly incorporated company or the existing company from taking advantage of the principle of joint and several liability, and thus, it can be determined by a special resolution of the general meeting of shareholders of the newly incorporated company or the divided company from among its obligations of the divided company. In such cases, the company bears only the obligations of the newly incorporated company or the divided company from among its obligations, and the newly incorporated company or the divided company from among its liabilities that it does not bear only the liabilities of the newly incorporated company or the divided company, regardless of its existence.

(b) the meaning of Article 11 of the Agreement;

According to the above facts, Article 11 of the contract of this case was presented in cases where it is not possible to merge due to the third cause, such as the amendment of the law or the amendment of the requirements for permission, which is not a cause attributable to the original and the defendant, but rather does not include cases where a party to the contract of this case misleads the legal effect of the contract of this case due to the legal non-existence of the provisions of the Commercial Act. Thus, the plaintiff's primary claim that the contract of this case is null and void or cancelled on the ground of the above contract

(c) the non-conformity and mistake of declaration;

For the purpose of the formation of a contract, there is a need for the objective agreement between the parties on several conflicting declarations of intention, and there is an objective agreement, all of the matters indicated in the parties' declarations of intention shall be the same. On the other hand, even if the contents of the contract are not "important" and the objective elements of the contract, when the parties expressed their intent with the significant significance and as a requirement for the formation of the contract, the contract is lawful and effective only when the agreement is reached (see Supreme Court Decision 2001Da53059, Apr. 11, 2003). In addition, in case where the parties did not reach an agreement on matters whose agreement should be reached, it is reasonable to deem that the contract has not been concluded unless there are special circumstances (see Supreme Court Decision 200Da51650, Mar. 23, 2001).

According to the above facts, the plaintiff thought that it is possible to acquire only a license except the defendant's obligation or property, and concluded the contract of this case with such intention by stating that "shall succeed to all the qualifications, such as the right to registration of construction business (license), performance records, and share of investment in mutual aid association," the subject matter of transfer under the contract shall be excluded from all the rights to obtain registration of construction business (license), construction work, and contribution to mutual aid association". However, it is reasonable to deem that the defendant entered into the contract of this case with the intent of the defendant and the representative director, etc. to compensate the plaintiff if any ex post problem arises with the knowledge that the plaintiff would be liable for joint and several liability for the defendant's obligation in accordance with the provisions of the Commercial Act. The contract of this case and each of the following documents (No. 3) shall be deemed as a way to resolve the problem by mutual understanding between the plaintiff and the defendant. Accordingly, the contract of this case is not inconsistent with the intent of both parties to request the confirmation of the amount of obligation and the decision to cancel the contract of this case.

Even if the contract of this case was effective, according to the above facts, the contract of this case is deemed to have been duly revoked since it is obvious that the plaintiff expressed his intent to cancel the contract of this case to the defendant on August 19, 2008 on the ground that it was clearly recorded that the plaintiff would succeed only to the qualification requirements for the electrical construction business, etc., and that it is not likely that the transferor would be forced to pay back the transferor's debts. After concluding the contract of this case, it would be caused by mistake in the important part of the contents of the legal act.

D. Sub-committee

Therefore, upon the plaintiff's conjunctive claim added at the trial court, the defendant is obligated to claim against the plaintiff about 100,000,000 won as return of unjust enrichment and damages for delay at each rate of 5% per annum under the Civil Act and 20% per annum under the Act on Special Cases Concerning the Promotion, etc. of Legal Proceedings from the next day of November 27, 2008, which is the date when the copy of the complaint of this case was served on the plaintiff as the return of unjust enrichment, until November 27, 2008, which is the date when the defendant delivered the copy of the complaint of this case. The defendant is obligated to claim against the plaintiff about the payment of the remaining price and damages for the plaintiff's default on the premise that the contract of this case is still valid, without any need to further examine.

4. Conclusion

Therefore, the plaintiff's primary claim is dismissed as it is without merit, and the supplementary claim added at the court of first instance is justified within the scope of the above recognition, and the remainder of the conjunctive claim is dismissed as it is without merit, and all of the counter-claim claims of the defendant are dismissed as it is without merit. Since the part concerning the main claim of the court of first instance which dismissed the plaintiff's primary claim is justified, the plaintiff's appeal is dismissed, and the plaintiff's conjunctive claim added at the court of first instance order is ordered to pay the above amount. The part concerning the counter-claim of the court of first instance is unfair with the above conclusion and it is so unfair to accept the plaintiff's appeal and dismiss the part against the plaintiff, and the defendant's counterclaim corresponding to the revoked part is dismissed, and the defendant's counterclaim added at the court of first instance is also dismissed.

Judges Hah Jin-hun (Presiding Judge)