Whether the avoidance power under Article 78 of the former Company Reorganization Act ceases to exist due to the completion of the company reorganization procedure (affirmative), and whether the company reorganization procedure is terminated before the assets are recovered to the company pursuant to the avoidance power exercised during the process of the company reorganization procedure (affirmative)

Articles 78 (refer to Article 100 of the current Debtor Rehabilitation and Bankruptcy Act), 82 (refer to Article 105 of the current Debtor Rehabilitation and Bankruptcy Act), and 271 (refer to Article 283 of the current Debtor Rehabilitation and Bankruptcy Act) of the former Company Reorganization Act (repealed by Article 2 of the Addenda to the Debtor Rehabilitation and Bankruptcy Act, Act No. 7428 of March 31, 2005)

Supreme Court Decision 95Da30253 Decided October 13, 1995 (Gong1995Ha, 3775) Supreme Court Decision 2002Da46058 Decided July 22, 2004 (Gong2006Ha, 1884) Decided October 12, 2006

1. A bankrupt person, a bankruptcy trustee, and one other (Attorney Choi Jae-soo, Counsel for the plaintiff-appellant)

The manager of the company's career of the reorganization company shall be the company's career (Attorneys Yoon Jae-sik et al., Counsel for the plaintiff-appellant)

Seoul High Court Decision 2004Na73469 delivered on October 21, 2005

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

The grounds of appeal are examined.

Article 78 of the former Company Reorganization Act (repealed by Article 2 of the Addenda to the Debtor Rehabilitation and Bankruptcy Act, Act No. 7428 of March 31, 2005, hereinafter the "Company Reorganization Act") provides that the right to set aside under Article 78 of the former Company Reorganization Act (the "Company Reorganization Act") is a special system with limited liability under the Company Reorganization Act, which is recognized to restore the company's property unfairly disposed prior to the decision to commence reorganization proceedings, and can only be exercised by the administrator on the premise that the reorganization proceedings are in progress. Thus, even if the right to set aside has been exercised during the reorganization proceedings, if the reorganization proceedings are completed prior to the recovery of the company's property, the right to demand return of the property against the other party or to demand redemption of the value thereof shall also be deemed to be extinguished as an effect of exercising the right to set aside (see Supreme Court Decisions 95Da30253, Oct. 13, 195; 2002Da46058, Jul. 22, 2004).

Examining the reasoning of the judgment below in light of the records, the court below's rejection of the defendant's right to set aside the grounds as stated in its holding is just and there is no error in the misapprehension of legal principles as to the nature of the denial lawsuit, the effect of the exercise of the right to set aside, and the effect of the completion of the reorganization proceedings

Furthermore, the Defendant’s remaining grounds of appeal are apparent that it is against additional and family judgment added to the above judgment even in light of the content of the judgment below. As seen above, insofar as the principal judgment of the court below is justifiable, the Defendant’s assertion in the grounds of appeal that the lower court erred in its additional judgment does not affect the conclusion of the judgment, and thus, it cannot be accepted without examining it.

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.

Justices Kim Hwang-sik (Presiding Justice)