[edit] Supreme Court Decision 98Da17145 delivered on September 4, 2002 [Assumed Debt]

【Main Issues】

[1] Where a claimant's conjunctive claim was mentioned neither in the disposition nor in the reasoning of the judgment in a previous lawsuit, whether a subsequent lawsuit whose chose in action is identical to the conjunctive claim of the previous lawsuit, is barred by res judicata (negative)

[2] Where it was possible to use more convenient and expeditious procedures to obtain an appropriate decision of the court for resolving a dispute, whether the fact that the party did not resort to such procedures would make the party's subsequent attempt to seek judicial resolution of the same dispute unlawful and whether it is for the court to inquire into such a fact by itself in order to fulfil the requirement of passively protecting rights in legal action (affirmative)

[3] Where a party was aware of a lower court's error affecting its judgment and nevertheless did not make use of the appeal procedure which was available to correct the error, whether the party is allowed, after the lower court's judgment thus became final, to bring a separate lawsuit to correct the error (negative)

[4] Where an intermediate appellate court's judgment dismissed the main claim and did not at all consider the conjunctive claim, whether a second appeal will carry the conjunctive claim as well as the main claim to the Supreme Court (affirmative)

[5] Where an intermediate appellate court did not deal with the conjunctive claim at all while dismissing the main claim, and the plaintiff, through a second appeal, pointed out the appellate court's error, and the Supreme Court also overlooked the error, what remedy should be allowed to the plaintiff (=review procedure).

[6] Whether a plaintiff, with respect to alternative claims, may designate the one as the main claim and the other as the conjunctive claim, fixing the order and scope of a hearing (known as a joinder of quasi conjunctive claim) (affirmative)

[7] Whether a plaintiff may join an conjunctive claim which purports to be considered in the event and to the extent that the main claim is not wholly accepted (affirmative)

[8] Where a plaintiff, although being aware that an intermediate appellate court had not judged the conjunctive claim it should have, did not resort to a second appeal available to correct the error, and as a result, the intermediate appellate court's judgment became final, whether he or she can bring a separate lawsuit for all or part of the conjunctive claim which was overlooked (negative)

【Summary of Decision】

[1] If the court did not make any decision as to a claim at all, such a claim is not to be barred by res judicata. So, the court below erred where it held that the plaintiff's claim was barred by res judicata for the reason that it was identical to the plaintiff's conjunctive claim of the previous lawsuit which the court below understood had been dismissed by the previous court although the plaintiff's conjunctive claim was not mentioned in the disposition or in the reasoning of the previous court's judgment upon rehearing after the entire case had been remanded.

[2] The court must inquire by itself in order to fulfil the requirement of passively protecting rights in legal action whether the party did not resort to the procedure which was more convenient and expeditious for him or her to obtain an appropriate decision of the court resolving the dispute.

[3] A party who might have been adversely affected by an err or flaw in a judgment may appeal it to obtain an appropriate judgment which resolve the dispute without having to bring a separate lawsuit and the requirement of economical resolution of dispute require the aggrieved party to resort only to such an appeal procedure for a proper judgment of the court concerning the lower court's decision. For this reason, if a party knowing the error affecting the lower court's decision did not make use of the appeal procedure which was available to correct such an error and the lower court's judgment thus became final (unless the judgment is so unlawful as to render it utterly void), he or she voluntarily waives its right to use the appeal procedure which is more convenient and expeditious for resolving the dispute under the circumstances, and may not subsequently to bring a separate lawsuit to resolve the same dispute, for he or she fails to satisfy the prerequisites for a remedy from the court.

[4] If the court, while dismissing the main claim, does not judge the conjunctive claim, such a decision is unlawful as it is against the purpose of allowing a joinder of an conjunctive claim to the main claim. If the error is not corrected in the intermediate appellate court, a second appeal will carry both the main claim and the conjunctive claim to the Supreme Court. In that case, it cannot be said that the conjunctive claim has not received a judgment from which an appeal can be made to the Supreme Court.

[5] If the intermediate appellate court did not deal with the conjunctive claim at all while dismissing the main claim, the plaintiff should make a second appeal to have the error corrected. Where the plaintiff made a second appeal and pointed out that the intermediate appellate court had omitted to examine and judge the conjunctive claim and the Supreme Court, in its final decision, nevertheless fails to correct the error due to an oversight, he or she should seek to apply for a review procedure to have the error corrected.

[6] It is possible to join two alternative claims designating the one as the main claim and the other as the conjunctive claim, thus fixing the order and scope of hearing (known as a joinder of quasi conjunctive claim).

[7] It is permissible to join an conjunctive claim which purports to be considered in the event and to the extent that the main claim is not wholly successful.

[8] If a plaintiff was aware that the appellate court had not judged the conjunctive claim it should have, the claimant ought to make a second appeal to have the error corrected. If the claimant did not resort to a second appeal available to correct the error, which made the intermediate appellate court's judgment final, he or she cannot bring another lawsuit for all or part of the conjunctive claim.

【Reference Provisions】 [1] the old Civil Procedure Act (revised by Act No. 6626) Article 202 / [2] the old Civil Procedure Act (revised by Act No. 6626) Article 24 / [3] the old Civil Procedure Act (revised by Act No. 6626) Article 226 / [4] the old Civil Procedure Act (revised by Act No. 6626) Article 230, 401 / [5] the old Civil Procedure Act (revised by Act No. 6626) Article 422 / [6] the old Civil Procedure Act (revised by Act No. 6626) Article 230 / [7] the old Civil Procedure Act (revised by Act No. 6626) Article 230 / [8] the old Civil Procedure Act (revised by Act No. 6626) Article 226

【Reference Cases】 [4] Supreme Court Full Bench Decision 98Da22253 delivered on November 16, 2001 / [6] Supreme Court Decision 2001Da17633 delivered on February 8, 2002

【Plaintiff, Appellant】 Ahn Yoon-soo (Attorney Jeong Yeon-jo, Counsel for plaintiff-appellant)

【Defendant, Appellee】Dong-Yang Academy, Inc. (Attorneys Song Young-gil and 2 others, Counsel for defendant, Counsel for defendant- appellee)

【Court of First Instance】 Southern Branch of Seoul District Court Judgment 97Gahap17903 delivered on November 12, 1997

【Court of second Instance】 Seoul High Court Judgment 97Na58127 delivered on March 12, 1998

【Disposition】 The appeal shall be dismissed. All costs of the appeal are assessed against the plaintiff.

【Reasoning】 1. Summary of the judgment of the court below

A. Factual circumstances leading to this case and fact-findings by the court below

(1) Between August 29 and December 10, 1986, the plaintiff gave loans amounting to 85 million won to Yoon Yeo-sang which subsequently became due for repayment. The plaintiff also had an outstanding balance from the price of sale and a sum of liquidated damages payable by Yoon Yeo-sang which amounted to 35 million won which was secured by a promissory note issued on March 10, 1987. On August 19, 1989, the plaintiff obtained a provisional seizure order for Yoon Yeo-sang's claim against defendant concerning land sales to secure 117.7 million won which forms part of Yoon Yeo-sang's debts owed to the plaintiff. The plaintiff subsequently brought a lawsuit against Yoon Yeo-sang with respect to the above mentioned claims and, on September 19, 1990, a judgment for the plaintiff was entered with a permission for provisional enforcement for a total amount of 235,732,873 won consisting of the principal amount of 120 million won and the interest thereon. The plaintiff then proceeded to enforce the judgment in respect of 200 million won and on October 23, 1990, the plaintiff was granted an order which changed the above-mentioned provisional seizure in respect of 117.7 million won into a final seizure. Further 112.3 million won of Yoon's claim against the defendant was also seized. For each of these claims, the plaintiff then obtained an assignment order from the court.

(2) Afterwards, the plaintiff brought a lawsuit (hereinafter referred to as `the previous lawsuit') against the defendant, claiming, in the first place, 211,587,688 won of assignment credit together with interest thereon and, conjunctively, 145 million won of debt and interest thereon alleging that on May 22, 1989, the defendant agreed to pay 145 million won to the plaintiff by November 30, 1989 as the defendant took over the debt Yoon Yeo-sang owed to the plaintiff with respect to a loan of 85 million won and interest thereon which amounted to 145 million won.

(3) Seoul District Court, Southern Branch Court, heard the case as the court of first instance. A judgment, 93Gahap2477, was entered on November 25, 1993. In that judgment, the court found, with regard to the main claim, that the defendant had discharged the debt owed to Yoon Yeo-sang before the assignment order was served to the defendant. Accordingly, the plaintiff's main claim was allowed only to the extent of 117 million won which had preliminarily been seized before the defendant discharged the debt. The rest of the plaintiff's main claim was dismissed. Regarding the plaintiff's conjunctive claim, the court held that since the main claim was allowed in part, there was no need to examine and judge the conjunctive claim. The said judgment, therefore, did not deal with the plaintiff's conjunctive claim at all. The disposition and the reasoning given by the court thus did not mention the conjunctive claim of the plaintiff. In describing the summary of the plaintiff's claims, the court did not list the conjunctive claim either.

(4) The plaintiff appealed to Seoul High Court. On September 13, 1994, a judgment, 94Na103, was delivered dismissing the appeal. The appellate court gave reasons which are substantially the same as those given by the court of first instance. Regarding, however, the plaintiff's claim that the defendant must pay 35 million won and interest thereon to the plaintiff as the defendant agreed on March 10, 1987 that the balance of sale of a land, 35 million won, owed to Yoon Yeo-sang would be paid directly to the plaintiff, the appellate court held that the claim is incompatible with the main claim of the plaintiff. As the plaintiff's main claim is allowed in part, the appellate court held that it was unnecessary to examine and judge the conjunctive claim incompatible with the main claim and struck out the conjunctive claim on the ground that it presented no valid cause of action on its face.

(5) The plaintiff appealed for the second with respect to 35 million won and interest thereon which corresponded either to the unsuccessful part of the main claim or to a part of the conjunctive claim which was wholly unsuccessful. On February 9 1996, this Court delivered a judgment, 94Da50274. We found that the claim for interest accrued on the assignment credit had not at all been dealt with by the appellate court. To this extent, therefore, the second appeal was struck out because, as far as the interest on the assignment credit is concerned, there was no judgment of the appellate court to appeal against. The appellate court's judgment regarding 35 million won and interest thereon was reversed and the case was remanded to the court below so that the plaintiff's principal and conjunctive claims can be heard afresh.

(6) Upon rehearing, the appellate court delivered a judgment, 96Na13035, on October 25, 1996, holding that the conjunctive claim of 35 million won and interest thereon had not been the subject matter of the second appeal and that the matter was not for rehearing. Regarding the main claim of 35 million won and interest thereon, the appellate court allowed the plaintiff's claim. Regarding the plaintiff's conjunctive claim, the appellate court did not consider whether to allow or dismiss the claim.

(7) The plaintiff did not appeal against this judgment of the appellate court in respect of the conjunctive claim which the appellate court omitted to examine and judge. The previous lawsuit was concluded when, upon lapse of the period for filing an appeal, the court's judgment became final in November 1996.

B. On this case and summary of the court below's judgment

The plaintiff brought the present lawsuit on August 21, 1997 alleging the grounds for claim which are identical to those of the conjunctive claim in the previous lawsuit. The plaintiff alleged that in addition to Yoon Yeo-sang, the defendant also undertook to pay to the plaintiff 145 million won which represents 85 million won of loan extended by the plaintiff to Yoon Yeo-sang and interest thereon. Upon this allegation, the plaintiff claimed 80 million won and interest thereon which form part of the amount claimed as the conjunctive claim in the previous lawsuit.

Seoul District Court Southern Branch Court heard the case as the court of first instance. In its judgment, 97Gahap17903, the court of first instance held that the claim was identical to the conjunctive claim of the previous lawsuit and that the appellate court was deemed to have dismissed the conjunctive claim upon rehearing the previous lawsuit after it had been remanded to that court. As the judgment upon rehearing by the appellate court was not appealed against, it became final. The court of first instance held that the plaintiff was repeating the claim which had been dismissed by a final judgment without alleging fresh facts which came to light after the closing of the hearing upon which the final judgment was entered. The plaintiff's claim was therefore found to have been barred by res judicata. The court of first instance further held that even if a part of the present claim could be viewed as forming part of 35 million won and interest thereon which constitute the main claim of the previous lawsuit remanded to the appellate court for rehearing, the main claim of the previous lawsuit was allowed upon rehearing and the judgment to that effect became final. To that extent, held the court of first instance, the plaintiff was repeating a claim which had already been satisfied. The court of first instance therefore concluded that as there were no compelling circumstances which would render it necessary to entertain the present claim, the plaintiff's claim must be dismissed. The plaintiff appealed. The court below dismissed the appeal on substantially the same grounds as those advanced by the court of first instance.

2. Judgment of this Court

A. On the ground for appeal as to res judicata and lawfulness of the present lawsuit

When a court pronounces a judgment after having heard lawfulness that the formal requirements for the finality of the judgment are met, the matter which was thus decided is to be treated as res judicata. As a result, the court's decision on that matter will be respected in all subsequent proceedings. The effect of res judicata is confined to the cause of action put forward by competent parties under the procedural safeguards stemming from principles of adversary proceeding and autonomy of the parties provided that the court's decision on that cause of action has been specified in the disposition of the court.

Therefore, if the court did not make any decision as to a claim at all, such a claim is not to be barred by res judicata as the appellant rightly pointed out in his appellate brief.

So, the court below erred where it held that the plaintiff's claim was barred by res judicata for the reason that it was identical to the plaintiff's conjunctive claim of the previous lawsuit which the court below understood had been dismissed by the previous court although the plaintiff's conjunctive claim was not mentioned in the disposition or in the reasoning of the previous court's judgment upon rehearing after the entire case had been remanded.

However, the Appellant's remaining arguments concerning the merit of this case necessitate an inquiry into general requirements of a lawsuit. This is an issue which this Court must consider on its own motion.

B. On the lawfulness of a legal action and prerequisites for demanding a remedy

(1) Lawfulness of a legal action is a matter to be examined by the court on its own motion. (See Supreme Court Decision 95Da14817 delivered on July 25, 1995.) In order to resort to judicial processes to protect one's private rights, certain prerequisites of a remedy must met. (See, for example, Supreme Court Decision 94Da21559 delivered on August 11, 1995 and Supreme Court Decision 79Da1275 delivered on September 11, 1979.)

Moreover, Article 1 of the old Civil Procedure Act (revised by Act No. 6626) sets forth the requirement of good faith as the overriding principle which is to guide the whole process of civil litigation. Accordingly, parties to a lawsuit are required to put forward relevant facts, arguments and evidence in an expeditious manner avoiding unnecessary costs and waste of time. The parties should make timely use of appeal procedures so that the dispute can effectively and finally be resolved within the course of the same lawsuit. The parties therefore have the duty to cooperate in good faith with the court in its case management.

In accordance with this guiding principle, the old Civil Procedure Act provided that the party who withdraws after the case has been concluded by the pronouncement of a judgment shall not be allowed to bring a lawsuit seeking to make the same claim (Article 240, Paragraph (2)). The party is allowed to bring a first appeal against the judgment of the court of first instance only during the period of appeal (Articles 360 and 366). The party is allowed to bring a second appeal against the judgment of an appellate court only during the period of second appeal and only if there are reasons for a second appeal (Articles 392 to 395). Once a judgment becomes final, even if the judgment contains unlawful rulings affecting the outcome of the judgment, review procedure is allowed only when there are prescribed grounds for review procedure. Even then, where the party knew the unlawful rulings contained in the judgment and where it was possible for the party to bring an appeal before the judgment became final and nevertheless did not bring an appeal, the review procedure is not allowed (Article 422, Paragraph (1)). The current Civil Procedure Act as wholly amended by Act No. 6626 has essentially the same provisions.

In the light of these provisions and the relevant cases, it is to be concluded that the court must inquire by itself whether the party did not resort to the procedure which was more convenient and expeditious for him or her to obtain an appropriate decision of the court resolving the dispute. A party who might have been adversely affected by an err or flaw in a judgment may appeal it to obtain an appropriate judgment which resolve the dispute without having to bring a separate lawsuit and the requirement of economical resolution of dispute require the aggrieved party to resort only to such an appeal procedure for a proper judgment of the court concerning the lower court's decision. For this reason, if a party knowing the error affecting the lower court's decision did not make use of the appeal procedure which was available to correct such an error and the lower court's judgment thus became final (unless the judgment is so unlawful as to render it utterly void), he or she voluntarily waives its right to use the appeal procedure which is more convenient and expeditious for resolving the dispute under the circumstances, and may not subsequently to bring a separate lawsuit to resolve the same dispute, for he or she fails to satisfy the prerequisites for a remedy from the court.

(2) Where an conjunctive claim is added to the main claim and both claims are joined in a lawsuit, the conjunctive claim must be considered if, and only if, the main claim should fail. As the two claims are inseparably joined in one lawsuit, if the court, while dismissing the main claim, does not judge the conjunctive claim, such a decision is unlawful as it is against the purpose of allowing a joinder of an conjunctive claim to the main claim. If the error is not corrected in the intermediate appellate court, a second appeal will carry both the main claim and the conjunctive claim to the Supreme Court. In that cases, it cannot be said that the conjunctive claim has not received a judgment from which an appeal can be made to the Supreme Court. (See Supreme Court Full Bench Decision 98Da2253 delivered on November 16, 2000.) If the intermediate appellate court did not deal with the conjunctive claim at all while dismissing the main claim, the plaintiff should make a second appeal to have the error corrected. Where the plaintiff made a second appeal and pointed out that the intermediate appellate court had omitted to examine and judge the conjunctive claim and the Supreme Court, in its final decision, nevertheless fails to correct the error due to an oversight, he or she should seek to apply for a review procedure to have the error corrected.

Moreover, it is possible to join two conjunctive claims designating the one as the main claim and the other as the conjunctive claim, thus fixing the order and scope of hearing (known as a joinder of quasi conjunctive claim). It is also permissible to join an conjunctive claim which purports to be considered in the event and to the extent that the main claim is not wholly successful. Where such a joinder was made and the appellate court, in its judgment, did not at all deal with the conjunctive claim while the main claim was allowed only in part, the judgment is unlawful as we explained above. Upon second appeal, the conjunctive claim will be carried to this Court in the same manner as when a joinder of genuine conjunctive claim was made.

(3) Therefore, if a plaintiff was aware that the appellate court had not judged the conjunctive claim it should have, the claimant ought to make a second appeal to have the error corrected. If the claimant did not resort to a second appeal available to correct, which made the intermediate appellate court's judgment final, he or she cannot bring another lawsuit for all or part of the conjunctive claim.

C. On the lawfulness of this case

(1) According to the facts of this case which we have stated at the outset, it is to be understood that the plaintiff in the previous lawsuit joined two conjunctive claims which are not mutually exclusive: one for the assigned credit and the other for a debt allegedly taken over by the defendant. As the main claim, the plaintiff sought payment of the assigned credit of 120 million won and interest thereon. To this was joined the conjunctive claim for payment of a debt of 145 million won and interest thereon allegedly taken over by the defendant. The plaintiff thus designated the sequence of hearings for the two claims. The scope of hearing was also fixed by the plaintiff in that the conjunctive claim was to be heard only to the extent that the main claim was unsuccessful. Nevertheless, the appellate court - before the case was remanded to it - misunderstood that the plaintiff intended the conjunctive claim to be heard only when the main claim turned out to be wholly unsuccessful. As a result, the appellate court concluded that the conjunctive claim needed not be heard after having allowed only a part of the main claim. Such a decision was wrong as it omitted to consider the conjunctive claim which ought in the event to have been considered. The appellate court therefore committed an error in its understanding of the joinder of conjunctive claim.

The plaintiff, however, chose to make a second appeal in respect only of 35 million won from his main claim or of the same amount from his conjunctive claim whereas it was possible to make a second appeal in respect of the entirety of his unsuccessful claims. As a result, the appellate court's judgment regarding the part of the plaintiff's unsuccessful principal and conjunctive claims against which the plaintiff chose not to make a second appeal, became final. Moreover, when the case was reheard in the appellate court after it had been remanded to that court, the appellate court considered the plaintiff's main claim of 35 million won and did not at all deal with the conjunctive claim of the same amount whereas both claims were remanded to that court for rehearing. The plaintiff could, if he or she wanted to, resort to a second appeal to have this error corrected. But no appeal was made against the appellate court's judgment delivered upon rehearing. Thus, the judgment omitting the consideration of the conjunctive claim became final.

Therefore, the plaintiff was aware that, upon rehearing, the appellate court failed to consider the conjunctive claim. Having had no recourse to appeal procedure while it was possible to do so, the plaintiff now brought a separate lawsuit seeking a claim which is identical to a part of his conjunctive claim in the previous lawsuit. In view of the guiding principles and overriding objective of civil litigation as explained above, such an attempt cannot be permitted as it fails to meet the prerequisites for demanding a remedy from the court.

(2) The court of first instance, however, held that the plaintiff's claim was barred by res judicata or disclosed no valid claim worthy of protection. Nevertheless, the plaintiff's claim was not struck out. The court of first instance dismissed the claim instead. The court below endorsed the judgment of the court of first instance and dismissed the plaintiff's first appeal. As we noted above, this decision was due to a misunderstanding of the scope of res judicata. Moreover, it was not entirely correct to dismiss the claim as it was more appropriate to strike it out. However, since the court below merely maintained the judgment of the court of first instance which was entered without any consideration of the merit of the claim, even if the court below's judgment is allowed to stand, the judgment will have no effect of res judicata regarding the subject matter of the plaintiff's present claim. As we take the view that the plaintiff's claim should have been struck out without any implications concerning res judicata, the court below's slight error in formulating the wording of the Order is not material enough to reverse its judgment. (See Supreme Court Decision 91Da29026 delivered on November 24, 1992, Supreme Court Decision 92Da48857 delivered on July 13, 1993.)

3. Conclusion

Based on the foregoing, we conclude that the appeal shall be dismissed and all costs of the appeal are assessed against the appellant. This judgment is delivered with the assent of all Justices who reviewed the appeal.

Justices Kang Shin-wook (Presiding Justice)

Cho Moo-jeh (Justice in charge)

Yoo Ji-dam

Son Ji-yol

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