The appeal is dismissed.

The costs of appeal are assessed against the defendant.

The grounds of appeal are examined.

1. As to the grounds of appeal Nos. 2 and 3

A. Article 530-9(1) of the Commercial Act provides that “A company established by division or merger after division or a surviving company shall be jointly and severally liable for the obligations of the company prior to the division or merger after division.”

However, by a resolution of the approval of division at the general meeting of shareholders, the above joint and several liability may be excluded by prescribing that only a company established by division or a company with which a company is invested in accordance with division (hereinafter referred to as the “debtor company”) bears the liability with respect to the property invested among the obligations of the divided company (Article 530-9(2) and (3) of the Commercial Act), but in such cases, the procedures for protecting creditors pursuant to Article 527-5 of the Commercial Act, etc. shall

(Article 530-9(4) of the Commercial Act. In such a case where the Commercial Act divides a stock company, the successor company and the division company surviving the division shall, in principle, hold the joint and several liability for the existing obligations of the divided company because the division may affect the existing creditors of the divided company by arbitrarily allocating the positive property and the small property of the divided company due to the division to the succeeding company and changing the debtor and the responsible property.

Meanwhile, according to Article 193(2)6 of the Debtor Rehabilitation and Bankruptcy Act (hereinafter “Rehabilitation Act”), the rehabilitation procedure may determine the division, merger after split-off, etc. of the debtor who is a stock company in the rehabilitation plan. In such cases, a joint and several liability under Article 530-9(1) of the Commercial Act may be excluded by prescribing that the succeeding company in the rehabilitation plan shall only bear the liability for the assets invested among the

(Article 212(1)7, Article 213(1)7, and Article 272(1) of the Debtor Rehabilitation Act.