The case affirming the judgment of the court below that Article 163 subparagraph 1 of the Company Reorganization Act does not apply to the case where a company reorganization procedure has been initiated and has been implemented as a bankruptcy procedure, after the bankruptcy is declared.

The case affirming the judgment of the court below that Article 24 (2) and (4) of the Company Reorganization Act is not based on the premise that both procedures are the same for the prompt withdrawal of insolvent enterprises by omitting the overlapping procedure where the company reorganization procedure is implemented as the bankruptcy procedure, and that Article 24 (1) of the Company Reorganization Act explicitly provides that public-interest claims shall be the bankruptcy estate claims, but there is no provision that the effect of the prohibition of offset shall be extended until after the bankruptcy is declared, and Article 95 of the Company Reorganization Act provides for the prohibition of offset separately from the Company Reorganization Act, since the company reorganization procedure is in progress and the company reorganization procedure is implemented as the bankruptcy procedure, it shall not be deemed that Article 163 subparagraph 1 of the Company Reorganization Act shall not apply even after the bankruptcy is declared.

Articles 24 and 163 subparag. 1 of the Company Reorganization Act, Article 95 of the Bankruptcy Act

The bankruptcy trustee of the bankrupt company, who is the non-party 1 bankruptcy trustee of the same family construction industry corporation, shall be the non-party 2 (Attorney Maximum Approval, Counsel for the plaintiff-appellant)

Samd Enterprise Co., Ltd. (Law Firm Tae Tae, Attorneys Kim Sung-soo et al., Counsel for the plaintiff-appellant)

Seoul High Court Decision 2004Na64328 delivered on April 22, 2005

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

1. The court below, based on its adopted evidence, acknowledged the facts that the company company of the East Asian Construction Industry (hereinafter referred to as the "Dong Asian Construction") was declared bankrupt on March 9, 200 after receiving a decision to discontinue the company reorganization procedure from the Seoul Central District Court on November 24, 200 after receiving a decision to discontinue the company reorganization procedure on March 9, 201, and the decision to abolish it became final and conclusive on May 11, 2001. The purpose of Article 24(2) and (4) of the Company Reorganization Act is not to promptly leave the insolvent company by omitting the company reorganization procedure where the company reorganization procedure is implemented under the bankruptcy procedure. The court below's determination is not based on the premise that both procedures are the same, but it does not stipulate that public-interest claims are estate estate claims under Article 24(1) of the Company Reorganization Act, but it does not include any provision extending the effect after the bankruptcy is declared, and it cannot be viewed that there is no error in the misapprehension of legal principles as to the prohibition of offset under Article 16 of the Company Reorganization Act.

2. In light of the records, we affirm the court below's rejection of the plaintiff's allegation of the prohibition of offset on the ground that the defendant's exercise of the right of offset against the claim of this case with the claim of this case as an automatic claim does not fall under any of the subparagraphs of Article 95 of the Bankruptcy Act concerning the prohibition of offset, and there is no error of law as to the prohibition of offset under Article 95 of the Bankruptcy Act as alleged in the ground of appeal.

3. Therefore, the appeal is dismissed, and the costs of appeal are assessed against the losing plaintiff. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Kim Yong-dam (Presiding Justice)