[1] In a case where a representative director borrowed money to use the company's funds, whether such borrowed money can be viewed as a commercial obligation (negative)

[2] In a case where Gap et al. entered into a share contract for a redevelopment project with Eul corporation, and Byung who actually led a reconstruction project as the actual management owner of Eul corporation and borrowed money from Eul under the pretext of the construction cost, etc. of a reconstruction project, the case holding that the court below erred by misapprehending the legal principles that the above borrowed money is subject to commercial extinctive prescription as a commercial debt

[1] Articles 4, 5(2), and 47 of the Commercial Act / [2] Articles 4, 5(2), 47, and 64 of the Commercial Act

[1] Supreme Court Decision 92Da7948 decided Nov. 10, 1992 (Gong1993Sang, 74) Supreme Court Decision 201Da43594 decided Jul. 26, 2012 (Gong2012Ha, 1491)

Plaintiff (Law Firm Clovis, Attorneys Lee Woo-soo, Counsel for the plaintiff-appellant)

Defendant 1 and five others (Law Firm Tae, Attorneys Kim Jong-sik et al., Counsel for the defendant-appellant)

Suwon District Court Decision 2013Na42622 decided September 26, 2014

The judgment of the court below is reversed, and the case is remanded to Suwon District Court Panel Division.

The grounds of appeal are examined.

1. The lower court acknowledged the following facts: (a) Hyundai Co-owners, located in each site of this case, entered into a share-based construction contract for the reconstruction project of this case with the Daean Construction Co., Ltd. (hereinafter “ Daean Construction”); (b) the Nonparty de facto led to the reconstruction project of this case as the actual management owner of Daean Construction; and (c) the Nonparty borrowed money from the Defendants under the pretext of using the Nonparty as the construction cost for the reconstruction project of this case; and (d) on the ground that the act of borrowing business funds for the reconstruction project of this case constitutes a commercial activity; and (b) on the ground that the Nonparty’s borrowing of business funds for the reconstruction project of this case constitutes a subsidiary commercial activity, the lower court determined that the Defendant’s borrowing debt owed to the Defendants of this case as a commercial obligation is subject

2. However, we cannot accept the above judgment of the court below as it is.

A. A merchant is engaged in a commercial activity as a principal agent of rights and obligations arising from a commercial activity. The premise that a person who conducts a business is qualified as a merchant in order to be subject to the Commercial Act as an auxiliary commercial activity is that the person who conducts the business, and even if the company is deemed as a merchant under the Commercial Act, the representative director, who is the institution of the company, is not a merchant, and even if the representative director, who is the institution of the company, is not a merchant, cannot be deemed as a commercial obligation (see Supreme Court Decisions 92Da7948, Nov. 10, 1992; 201Da8326, Mar. 29, 201; 201Da43594, Jul. 26, 2012).

B. Examining the reasoning of the judgment below in light of the aforementioned legal principles, as long as a substitute construction which is deemed a merchant under the Commercial Act enters into a contract for the construction project of this case for the said share-based interest-based interest-based interest-based interest-based interest-based interest-based interest-based interest-based interest-based interest-based interest-based interest-based interest-based interest-based interest-based interest-based interest-based interest-based interest-based interest-based interest-based interest-based interest-based interest-based interest-based interest-based interest-based interest-based interest

Nevertheless, the lower court determined otherwise that the commercial statute of limitations applies to the Nonparty’s obligation to the Defendants as commercial debt. In so doing, it erred by misapprehending the legal doctrine on commercial activities and the statute of limitations, thereby adversely affecting the conclusion of the judgment. The allegation contained in the grounds of appeal on this point is with merit.

3. Therefore, without further proceeding to decide on the remaining grounds of appeal, the lower judgment is reversed, and the case is remanded to the lower court for further proceedings consistent with this Opinion. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Kwon Soon-il (Presiding Justice)