The case holding that a partnership business agreement, the purport of which is that the plaintiff and the defendant shall jointly establish and operate a stock company by investing cash and goods in kind, and jointly manage the company according to the share ratio, shall be based on the joint business conducted by the plaintiff and the defendant in the name of the joint business and shall be based on the legal principles of the company in external relations and domestic relations, and its liquidation shall also be conducted in accordance with the provisions of the Commercial Act concerning the liquidation of the corporation.

The case holding that the liquidation should also be conducted in accordance with the provisions of the Commercial Act concerning the liquidation of a corporation on the ground that a partnership agreement, the purport of which is that the original and the defendant's joint investment in cash and in kind, jointly establish and operate a stock company and jointly manage the company in proportion to the share ratio of expenses incurred in the joint management of the company, shall be based on the joint investment of the original and the defendant in the name of the joint investment company and on the premise of the legal principles of the joint investment

Article 531 of the Commercial Act, Article 703 of the Civil Act

Plaintiff 1 and two others (Law Firm Hank, Attorneys Lee Ho-pon et al., Counsel for the plaintiff-appellant)

[Defendant-Appellant] Plaintiff 1 and 3 others (Attorney Lee Dong-sik, Counsel for defendant-appellant)

Seoul High Court Decision 2000Na27673 delivered on October 25, 2000

All appeals are dismissed. The costs of appeal are assessed against the plaintiffs.

1. As to the ground of appeal on the primary claim

The court below accepted the judgment of the court of first instance and acknowledged the facts as stated in its holding, and rejected the plaintiff's assertion that the defendant company is jointly and severally liable with the remaining defendants for the payment of the agreed amount of KRW 3.8 billion on the premise that the defendant company was a party to the above agreement, on December 2, 1997, on the ground that there is no evidence to acknowledge that the defendant company was a party to the above agreement. The court below rejected the plaintiff's rescission of the agreement on the ground that the plaintiffs did not send the documents necessary for the registration of establishment of a neighboring forest that had been performed prior to the payment of the agreed amount and did not follow the application for provisional disposition for termination of provisional disposition as to the forest of this case. Furthermore, the court below rejected the plaintiffs' assertion on the ground that the cancellation of the agreement by the defendants was legitimate on the ground that the defendants did not comply with the above agreement and did not follow the procedure for provisional disposition for the registration of establishment of a mortgage in the name of the plaintiffs as to the forest of paulium.

In light of the records, the above judgment of the court below is just, and there is no error of law such as misconception of facts or misapprehension of legal principles due to violation of the rules of evidence.

2. As to the ground of appeal on the conjunctive claim

The court below rejected the plaintiff 1 and the defendant 2's claim for unjust enrichment on October 18, 190 by citing the judgment of the court of first instance, since it is evident that the liquidation affairs of the above partnership were not yet completed, such as the liquidation issues of the defendant company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's company's dissolution or dispute's company's company's company's company's company's dissolution.

According to the facts established by the court below, it appears that the agreement of this case was aimed at jointly establishing and operating the defendant company by investing in cash and in kind (land) and jointly establishing the defendant company, and at sharing expenses and profits from the joint management of the defendant company. Thus, it is deemed that the agreement of this case is based on the joint business in the name of the defendant company and based on the legal principles of the corporation in external and internal relations, and it is not aimed at establishing an association for their joint business.

Furthermore, as long as the defendant company was established under such a partnership agreement and the entity as a stock company has been equipped, the plaintiffs cannot receive distribution of residual assets unless liquidation procedures are conducted under the provisions of the Commercial Act on the liquidation of the corporation. Therefore, the legal nature of the partnership agreement of this case is viewed as a partnership agreement under the Civil Act, and the judgment of the court below that premised on the existence of such partnership relationship is erroneous. However, the conclusion of rejecting the plaintiffs' conjunctive claim is just and there is no error of law such as misunderstanding of legal principles or incomplete

3. Therefore, all appeals are 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 on the bench.

Justices Son Ji-yol (Presiding Justice)