Open Decision Ledger · Rehabilitation & bankruptcy
The Meaning of Suspension of Payments under the Corporate Reorganization Act and Whether a Transferee Aware of an Order Suspending Current-Account Transactions Knew of the Suspension of Payments
Translated from the Korean original. Read the Korean
Supreme Court, Nov. 8, 2002, 2002Da28746 (judgment)
Case name: 부인
Official text on the National Law Information Center
Question
May a creditor who received payment while aware of the order suspending current-account transactions imposed on a company under reorganization be regarded as having known of the state of suspension of payments under Article 78, paragraph (1), subparagraph 2 of the Corporate Reorganization Act?
Holding
A suspension of payments is an outward indication that the debtor, for lack of means, cannot generally and continuously perform obligations that have fallen due. The Supreme Court held that, where an order suspending current-account transactions has been issued, the debtor is in a state of suspension of payments absent special circumstances, and that a person who knew of that order must be regarded, absent special circumstances, as having known of the state of suspension of payments.
Summary of the holding, verbatim
위와 같은 회사의 당좌거래정지처분을 알고 있었던 자는 특별한 사정이 없는 한 회사가 위 법 소정의 지급정지 상태에 있었음을 알고 있었다고 봄이 상당하다.
Unofficial English translation
A person who knew of the above disposition suspending the company's check-clearing transactions may, in the absence of special circumstances, be regarded as having known that the company was in a state of suspension of payment as provided in the above Act.
Disposition
Partly reversed and remanded Stated in the decision
그 부분 사건을 서울고등법원에 환송한다.
Unofficial English translation
That portion of the case is remanded to the Seoul High Court.
Form of the test
Elements stated Stated in the decision
은행이나 어음교환소로부터 당좌거래정지처분을 받은 때에는 특별한 사정이 없는 한 지급정지 상태에 있다고 할 것이므로
Unofficial English translation
since, when a disposition suspending check-clearing transactions has been received from a bank or a bill-clearing house, it should, in the absence of special circumstances, be regarded as being in a state of suspension of payment,
Factors
- 채무자가 변제기에 있는 채무를 자력의 결핍으로 인하여
- 외부에 표시하는 것을 말하고
- 은행이나 어음교환소로부터 당좌거래정지처분을 받은 때에는 특별한 사정이 없는 한 지급정지 상태에 있다고 할 것
- 회사의 당좌거래정지처분을 알고 있었던 자
Unofficial English translation
• that the debtor, by reason of a lack of means, an obligation that has fallen due
• means a manifestation to the outside, and
• when a disposition suspending check-clearing transactions has been received from a bank or a bill-clearing house, it should, in the absence of special circumstances, be regarded as being in a state of suspension of payment
• a person who knew of the company's disposition suspending check-clearing transactions
Relation to precedent
Follows earlier decisions Stated in the decision
대법원 2001. 6. 29. 선고 2000다63554 판결
Unofficial English translation
Supreme Court Decision 2000Da63554 decided June 29, 2001
Decisions referred to
대법원 2001. 6. 29. 선고 2000다63554 판결(공2001하, 1727)
Burden of proof
Not addressed Not in the decision
Open question and revisit condition
In what specific cases can there be special circumstances that negate the state of suspension of payments, or knowledge thereof, notwithstanding that an order suspending current-account transactions was issued?
If a new decision is handed down on the interpretation of the avoidance provisions of the Debtor Rehabilitation and Bankruptcy Act corresponding to Article 78, paragraph (1), subparagraph 2 of the Corporate Reorganization Act, this reading will be checked again.
Cross-family AI independent reading & axis check
8 of 8 axes matched GPT-6 Astra (OpenAI, codex CLI) · 2026-10-16
When compared with an independent reading by another AI line (GPT-6 Astra), which read only the original text without seeing the first reading, all 8 axes matched.
Raw responses and comparison record: Protocol · Blind readings (JSONL) · Axis comparison (JSONL) · SHA-256 (JSON)
Lower-court contrast & scope of application
Lower-court reading vs. Supreme Court holding
Lower-court context: The court below found that the company under reorganization was in a state of suspension of payments after the order suspending current-account transactions and that Defendant knew that fact, yet it rejected the avoidance claim, citing that the application for commencement of reorganization proceedings had been withdrawn in only 28 days, the reports of discussions within the consortium of creditor banks on normalization measures, and that the company continued to transact with its business partners even after the current-account suspension, on the ground that it is difficult to conclude that Defendant knew of the state of suspension of payments or of the fact prejudicial to reorganization creditors.
Supreme Court standard: The Supreme Court stated that a person who knew of the order suspending current-account transactions must be regarded, absent special circumstances, as having known of the state of suspension of payments, and held that the circumstantial facts cited by the court below were not circumstances indicating that the company under reorganization had recovered the ability to perform its existing obligations, and thus could not constitute grounds for finding Defendant's knowledge otherwise. Adding the facts that Defendant had participated in the Council of Creditor Financial Institutions and had used the credit information network, Defendant is to be said to have been well aware of the state of suspension of payments at the time of payment, and the Supreme Court reversed and remanded that part on the ground of violation of the rules of evidence and misapprehension of legal principles.
Distinguishing conditions
- Where, after the order suspending current-account transactions, the suspension was lifted, or there were circumstances in which the debtor had substantially recovered the ability to perform its existing obligations
- Where the transferee did not know of the fact of the order suspending current-account transactions itself at the time of payment
- Where the avoidance in question falls under a type of avoidance other than Article 78, paragraph (1), subparagraph 2 of the Corporate Reorganization Act, so that knowledge of the suspension of payments is not a requirement
Record verification notes
Before asserting the same conclusion, one must first check whether the current-account suspension remained unlifted as of the time of payment, and whether there were no special circumstances, such as financial support, in which the debtor had recovered the ability to perform its existing obligations.
From the official text
Points at issue
회사정리법 제78조 제1항 소정의 ‘지급의 정지’의 의미
Unofficial English translation
Meaning of 'suspension of payment' as used in Article 78 (1) of the Corporate Reorganization Act
Summary of the holding
회사정리법 제78조 제1항 제2호 소정의 ‘지급정지’라 함은 채무자가 변제기에 있는 채무를 자력의 결핍으로 인하여 일반적·계속적으로 변제할 수 없다는 것을 명시적·묵시적으로 외부에 표시하는 것을 말하고, 일반적으로 채무자가 어음을 발행한 후 은행이나 어음교환소로부터 당좌거래정지처분을 받은 때에는 특별한 사정이 없는 한 지급정지 상태에 있다고 할 것이므로, 위와 같은 회사의 당좌거래정지처분을 알고 있었던 자는 특별한 사정이 없는 한 회사가 위 법 소정의 지급정지 상태에 있었음을 알고 있었다고 봄이 상당하다.
Order
원심판결 중 피고가 압류 및 추심명령에 기하여 변제받은 금 844,274,120원에 관한 부분을 파기하고, 그 부분 사건을 서울고등법원에 환송한다.
Unofficial English translation
The portion of the judgment of the court below concerning the sum of KRW 844,274,120 that the defendant received in payment by virtue of an attachment and collection order is reversed, and that portion of the case is remanded to the Seoul High Court.
Provisions referred to
회사정리법 제78조 제1항 제2호
Read 2026-10-16 · Cross-read 2026-10-16. All quotes matched against the official text. The Chinese-character placeholders the court used for anonymised parties are given in their Korean readings, and parenthetical Chinese-character glosses are omitted.
Every entry is published only after all quotes have been matched character by character against the official text, and audited by an independent second reading from a different model family across all eight axes. Both agreed axes and text-grounded interpretive divergences are recorded openly. The ledger is a research record, not an assessment of the court or advice on any matter.
Back to the ledger