In case where a registration of alteration (Supplementary Registration) replacing a debtor due to the assumption of the obligation with respect to the right to collateral security has been completed, whether the right to collateral security provides a new obligation borne by the claimant for another reason (negative)

Where a debt is taken over, a security provided by a third party with respect to the debt of the former debtor shall be extinguished due to assumption of the obligation, but it shall continue to exist for the new debtor without extinguishment only where the third party has given his/her consent to assume the obligation. In this case, the consent to assume the obligation of a person who has pledged his/her property to secure the obligation is merely a declaration of intent not to establish a new security for the person to assume the obligation but to continue to maintain the existing security for the person to assume the obligation, and thus the security maintained by such consent has the same contents as the existing security. Therefore, in cases where a registration of change (Supplementary Registration) replacing the debtor due to the assumption of the obligation with respect to the right to collateral has been completed, unless there are special circumstances, such right to collateral is provided by the former debtor only as a security for the new debtor, and it cannot be deemed that the new debtor bears any other obligation even if the new debtor

Articles 357 and 459 of the Civil Act

Supreme Court Decision 96Da27476 delivered on October 11, 1996 (Gong1996Ha, 3325) Supreme Court Decision 98Da40657 delivered on September 3, 199 (Gong199Ha, 2026)

is the taking over of the lawsuit of the Han Credit Depository, one merged corporation

Maritime Credit Depository (Attorney Park Byung-chul, Counsel for the defendant-appellant)

Seoul High Court Decision 99Na62687 delivered on September 28, 2000

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

A security provided by a third party with respect to a debt of the former debtor shall be extinguished due to the assumption of the obligation, but the security provided by the former debtor shall continue to exist for the new debtor without extinguishment only where the third party has given consent to assume the obligation (Article 459 of the Civil Act). In this case, the consent given by the person who has pledged his/her property to assume the obligation is merely a declaration of intent to continue to maintain the existing security for the person who assumes the obligation, not a declaration of intent to create a new security for the person who assumes the obligation, and thus, the security maintained by such consent has the same contents as the existing security (Supreme Court Decision 96Da27476 delivered on October 11, 196). Thus, in cases where the registration of alteration is completed due to the assumption of the obligation of the former debtor with respect to the right to collateral security, unless there are special circumstances, it cannot be deemed that the right to collateral security is only secured by the former debtor with respect to the newly assumed obligation, and thereafter, it cannot be deemed that the new obligation has been borne by another debtor due to be borne by another (person).

After recognizing the facts of the judgment, the court below held that the defendant's debt secured by the right to collateral security on October 23, 1992 and the debt secured by the right to collateral security on November 10, 1992 is limited to the debt of the former debtor (stock company) which was acquired by the non-party 2, who is the assumption of the obligation, and thereafter, the defendant's decision was made on September 27, 1995 (the debtor is the non-party 2) after the establishment and registration of the right to collateral security (the debtor is the non-party 2) was made on June 30, 198, and the debt incurred by the non-party 2 was not the secured debt under each right to collateral security (the secured debt under each right to collateral security) but the debt guaranteed by the above non-party 3 is the secured debt under the above right to collateral security, and therefore, the judgment of the court below is justified in its determination on the ground that the above legal principles are not applied to the debt acquisition of the former company and the debtor.

Therefore, the appeal is dismissed. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Lee Ji-dam (Presiding Justice)