Supreme Court Decision 99Da23888 delivered on April 11, 2000 [Assigned Claim]

【Main Issues】

[1] Whether a person who became an assignee of a claim after a provisional seizure order against the claim had been served on the garnishee can file a suit for performance of the claim against the garnishee (affirmative)

[2] Who has the standing to file a suit for performance of the obligation under a seized claim against the garnishee after a seizure and collection order has been issued against a claim (i.e., collection creditor)

【Summary of Decision】

[1] Because the provisional seizure against claims generally prevents only the collection by the provisional seizure obligor from the garnishee, the provisional seizure obligor can file a suit for the performance against the garnishee and the court cannot reject such claim because of the provisional seizure; the assignment of claims refers to a contract to assign the claims from the former creditor, the assignor, to the new creditor, the assignee, while maintaining the identity of the claims; a claim is assigned from the assignor to the assignee without losing its identity; the claims subject to the provisional seizure can be assigned without being subject to any restrictions; provided, that the assignee of the claims subject to the provisional seizure obtains the claims as restricted in rights by such provisional seizure.

[2] When there exists a seizure and collection order, the claim for performance against the garnishee can be filed only by the collection creditor and the debtor shall lose its standing to file a claim for performance in connection with the seized claims.

【Reference Provisions】 [1] Article 449 of the Civil Code, Paragraph 3 of Article 709 of the Civil Procedure Act / [2] Articles 47 and Paragraph 2 of Article 563 of the Civil Procedure Act

Article 449 of the Civil Code (Assignability, Nature of Claim) (1) A claim may be assigned, except in cases where its nature does not so permit.

(2) Where the parties have declared a contrary intention, a claim shall not be assigned: Provided, that such declaration of intention cannot be set up against a third person acting in good faith.

Article 709 of the Civil Procedure Act (Execution of Provisional Seizure against Movables) (3) For a provisional seizure against claims, an order shall be issued to the garnishee to the effect that he or she shall not make any payment to the debtor.

Article 47 of the Civil Procedure Act (Principles as to Capacity for being a Party and Litigation Capacity, etc.) Unless otherwise prescribed in this Act, the capacity for being a party, the litigation capacity, the granting of authorization required for the legal representation of and for the procedural acts for the persons lacking litigation capacity, shall be governed by the Civil Code and other Acts.

Article 563 of the Civil Procedure Act (Method of Encashment of Monetary Claim) (2) When there exists a collection order, the execution creditor may collect the seized claim without going through the subrogation procedure.

【Reference Cases】 [1] Supreme Court Decision 88Daka25038 delivered on November 24, 1989 (Gong1990, 112), Supreme Court Full Bench Decision 92Da4680 delivered on November 10, 1992(Gong1993Sang, 72), Supreme Court Decision 98Da42615 delivered on February 9, 1999 (Gong1999Sang, 471) / [2] Supreme Court Decision 82Daka889 delivered on March 8, 1983 (Gong1983, 650), Supreme Court Decision 87Daka2931 delivered on January 17, 1989 (Gong1989, 292)

【Plaintiff, Appellant】 Kim Duk-hee (Law Firm Baak, Jang & Park, Attorneys Park Jang-woo and 3 others, Counsel for plaintiff-appellant)

【Defendant, Appellee】 Samchang Industry & Development Co.(Attorney Lee Gi-sub, Counsel for defendant-appellee)

【Court of First Instance】 Western Branch of Seoul District Court Judgment 97Gahap7219 delivered on August 26, 1998

【Court of Second Instance】 Seoul Hight Court Judgment 98Na52195 delivered on April 6, 1999

【Disposition】 The judgment of the court below shall be reversed and the case shall be remanded to Seoul High Court.

【Reasoning】 The grounds for appeal are examined as follows.

Pursuant to the reasoning for the judgment of the court below, the court below made its findings of facts as described in its judgment based on the evidence presented, and held that, based on such findings, the defendant assumed the obligation to pay 99,656,268 won as construction payment (deducting 100,313,312 won, the amount assumed by non-party Haitai Electronics Co., Ltd., 2,100,000 won, the damage for defects and 54,799,520 won, the liquidated damages, from 256,869,100 won, the remainder of construction payment) to a non-party to the suit, Greenline Co., Ltd. (hereinafter referred to as the "non-party company"). In response to the defendant's assertion that the defendant cannot comply with the plaintiff's request on the grounds that the defendant was served with the provisional seizure order and the seizure and collection order from other creditors in an amount exceeding the above-stated construction payment before it received the notice of assignment of the claims from the non-party company, the court below found, based on the evidence presented, that, on January 25, 1997, the defendant was served with a provisional seizure order against claims rendered by Jecheon Branch of Cheongju District Court (Order 97Kahap13) on January 21, 1997 for the claimed amount of 105,920,000 won with Chung Ju-hee as the creditor, the non-party company as the debtor and the defendant as the garnishee in relation to the claims for the above-mentioned construction payment before it received a bond transfer notice from the non-party company; that, on February 17, 1997, the defendant was served with a provisional seizure order against claims rendered by the above-mentioned branch (Order 97kahap26) on February 15, 1997 for the claimed amount of 55,736,330 won with Choi Dae-yoon and two others as the creditors, the non-party company as the debtor and the defendant as the garnishee; that, on April 4, 1997, the defendant was served with an amended Judgment rendered by the above-mentioned branch (Order 97Kagi61) on March 31, 1997 in connection with the above-mentioned provisional seizure order against claims (Order 97Kahap26); that, on the same date, the defendant was served with a seizure and collection order rendered by the above-mentioned branch (Order 97Tagi287, 288) on April 1, 1997 amending the above-mentioned provisional seizure order (Order 97Kahap26) to the order for seizure; and that, on April 1, 1997, the defendant was served with a provisional seizure order against claims rendered by Western Branch of Seoul District Court (Order 97Kadan2974) delivered on March 31, 1997 for the claimed amount of 40,000,000 won with Lee Kil-won as the creditor, the non-party company as the debtor and the defendant as the garnishee. Based on the foregoing facts, the court below determined that the defendant's assertion had merit and consequently rejected the plaintiff's claim as having no merit on the ground that the plaintiff, who became an assignee of the claim for 71,000,000 won out of the above-stated claim for construction payment after the defendant was served with each of the above-mentioned provisional seizure orders against claims, could not claim the construction payment assigned from the non-party company over the above-mentioned provisional seizure obligees preferentially in the order of priority.

However, because the provisional seizure against claims generally prevents only the collection by the provisional seizure obligor from the garnishee, the provisional seizure obligor can file a suit for the performance against the garnishee and the court cannot reject such claim on the ground of the provisional seizure (See Supreme Court Decision 88Daka25038 delivered on November 23, 1989, Supreme Court Full Bench Decision 92Da4680 delivered on November 10, 1992, etc.), and the assignment of claims refers to a contract to assign the claims from the former creditor, the assignor, to the new creditor, the assignee, while maintaining the identity of the claims; a claim is assigned from the assignor to the assignee without losing its identity; the claims subject to the provisional seizure can be assigned without being subject to any restrictions; provided, that the assignee of the claims subject to the provisional seizure obtains the claims as restricted in rights by such provisional seizure.

The judgment of the court below, notwithstanding the above, to the effect that the plaintiff, who became an assignee of the claim for 71,000,000 won out of the above-mentioned claim for construction payment after the defendant was served with each of the above-mentioned provisional seizure orders against claims, could not claim the construction payment against the defendant over the above-mentioned provisional seizure obligees preferentially in the order of priority was rendered due to a misinterpretation of the law concerning the legal status of the assignee of the provisionally attached or confiscated claims and he appeal on this ground shall therefore be justified.

Also, considering that, when there exists a seizure and collection order, the claim for performance against the garnishee can be filed only by the collection creditor and the debtor shall lose its standing to file a claim for performance in connection with the seized claims (See Supreme Court Decision 82Daka889 delivered on March 8, 1983, Supreme Court Decision 87Daka2931 delivered on January 17, 1989, etc.) and, pursuant to the determination of the court below, there existed the seizure and collection order against claims dated April 1, 1997 changing the provisional seizure order against claims dated February 15, 1997 or the claimed amount of 55,736,330 won with Choi Dae-yoon and two others as the creditors, the non-party company as the debtor and the defendant as the garnishee, the part of the suit in this case claiming the above-mentioned confiscated amount is unjustifiable. Thus, the court below's decision that all of the suits in this case were justifiable. was a reversible error as to a misinterpretation of the law concerning the legal status of the obligor subject to the collection order.

Accordingly, the judgment of the court below shall be reversed and the case shall be remanded to the court below for retrial. This decision is delivered with the assent of all Justices who reviewed the appeal.

Justices Song Jin-hun (Presiding Justice)

Lee Don-hui (Justice in charge)

Lee Im-soo

Yoon Jae-sik