Cases where the head of the land improvement cooperative determined that the act of borrowing money from a third party without obtaining the approval of the Do Governor shall not be deemed an act within the scope of performing his/her duties.

Even if a member of a land improvement project fails to take the prescribed procedures under the Land Improvement Project Act and leaves money from a third party, such an act is reasonable to regard it as an act performed in connection with his/her duties. However, if the third party knows that he/she is using the head of the association, it cannot be argued that he/she suffered damage in connection with his/her duties.

Article 35 of the Land Improvement Project Act (Closure), Article 10 of the Addenda to the Land Improvement Project Act (Closure), Article 35 of the Civil Act

Plaintiff

Association for the Improvement of populated Land

Daegu High Court Decision 67Na203 delivered on November 23, 1967

The judgment of the court below is reversed, and the case is remanded to Daegu High Court.

We examine the ground of appeal No. 2 by the Plaintiff’s agent.

In order to raise funds or borrow loans from a land improvement cooperative, it shall obtain authorization from the Minister of Agriculture and Forestry or the Do governor pursuant to Article 46 of the Land Improvement Project Act, and shall obtain a deliberation resolution or approval from the Do governor pursuant to subparagraph 3 of Article 30 of the same Act and paragraph 10 (b) of the Addenda to the same Act. However, even if the head of the land improvement project cooperative borrows money from a third party without following the above procedure, such act is also deemed as an act performed by the head of the cooperative as stipulated in Article 35 of the Land Improvement Projects Act and Article 35 of the Civil Act. Of course, if a third party who borrowed money was aware of the fact that he/she intends to use the name of the cooperative as a debtor, the third party cannot assert that the head of the cooperative incurred damages to himself/herself with respect to his/her duties. However, the court below erred by misapprehending the legal principles as to the act of performing his/her duties, and thus, it cannot be viewed as an act of a third party within the scope of execution of his/her duties.

This decision is consistent with the opinions of the involved judges.

The judge of the Supreme Court is Hong Dong-dong (Presiding Judge) and Dong-dong (Presiding Justice)