The Supreme Court en banc on the 23rd changed a precedent related to creditor-debtor relationships involving a creditor, a debtor, and a third-party debtor for the first time in 25 years. Until now, Supreme Court precedent held that if a creditor obtained a collection order on a claim the debtor had against a third-party debtor, or if the National Tax Service seized the claim due to tax delinquency, the debtor lacked standing to file a performance claim suit. However, a new precedent has been issued that the debtor should be considered to have standing to file a performance claim suit even in such cases.
On the day, all 13 members, including the chief justice and all justices, took part in the Supreme Court en banc, and 12 of them expressed the opinion that "the existing precedent is changed."
A, a reinforced concrete construction company, filed a lawsuit for damages and unjust enrichment against B, who had been paid business investment funds, saying it was unjust that B recovered more money than was actually lent. In the first trial, the court ruled that B must pay A about 87 million won, the amount corresponding to unjust enrichment. In the second trial, the amount B had to pay A increased to a little over 300 million won.
B appealed the ruling, arguing that "because A's other creditors obtained seizure and collection orders on each claim for the pecuniary claims disputed in this lawsuit, A lost standing (qualification) to file this lawsuit." This argument was based on existing Supreme Court rulings.
In Feb. 2021, the Supreme Court reversed and remanded the case to the Suwon High Court. At the time, the Supreme Court said, "The court needs to first establish the facts, including whether the claims subject to each seizure and collection order asserted by B are identical to the claim disputed in this lawsuit, and then, accordingly, reconsider whether A has standing (party standing) to file a lawsuit against B regarding the claim."
On remand in Jul. 2021, the court said, "As to part of A's claims, the collection creditor canceled or waived the collection right, thereby restoring A's standing to sue B, and some are unrelated to the pecuniary claims disputed in this lawsuit." It then ruled, as the previous appellate court did, that B must pay A a little over 300 million won.
However, B filed a further appeal against the remand decision. B argued that after the remand ruling was delivered, A received new seizure and collection orders for the pecuniary claims disputed in this lawsuit, and that as A was delinquent on value-added taxes and other taxes, the tax authorities also seized the same claims, so A lacks standing to file this lawsuit.
The Supreme Court en banc on the day changed the existing precedent, saying that "A has standing to file a lawsuit to compel B to perform the debt."
A Supreme Court official said, "We will discard the existing precedent that deemed standing lost merely because there was a collection order, without a clear legal basis." The official added, "Even under the new precedent, it does not lead to unfair results for the parties and can promote one-time resolution of disputes."