이사의 감시의무에 대한 판례의 고찰

Abstract

The Korean Commercial Code (the “KCC”) provides a double monitoring system against the management of a company as an internal control: First,by ensuring that board of directors has the final authority to decide corporate actions and that board supervises the management including a representative director and active directors and second, by providing authority to an auditor to audit comprehensively any business affairs conducted by the representative director and other directors. It is also generally accepted that a director has a duty to monitor any or all corporate affairs including the conduct of other directors even though he/she does not take charge of corporate business operations and has no power to represent the corporation or to conduct business. The KCC stipulates, however, only abstract concepts about director’s duties and liabilities. In this regard, the court performs a much more important role in the question of how to apply the law and which conduct of directors is to be construed as a breach of the duties. This paper examines the court’s relevant cases and the Korean court's evolving standard used to judge the breach of the duty to monitor. The Korean court has made judgments to the effect that central to this issue is not a corporate structural problem but a problem concerning the individual's awareness of illegal or unjustified misconduct by other directors. There have been several cases regarding breach of director's duty to monitor since the Daemyung Wool & Textile case in 1985 where the Supreme Court accepted the concept (director’s duty to monitor) for the first time. However, the practical application to the standard in Daemyung has reached a limit, particularly when applied to the modernized and big-scaled corporation. In 2008, the Supreme Court understood the breach of a director’s duty to monitor other directors’ misconduct from the internal control perspective in Daewoo Corporation’s accounting fraud case. The court’s position in Daewoo has become the new standard supplementing the previous one in Daemyung. The Daewoo court clarified that the representative director as well as each director is under a continuing obligation to establish reasonable systems for information, reporting and internal control and to endeavor to operate those systems. Furthermore, even if the systems were established, the director cannot argue his/her innocence in regard to any corporate risks or problems, (including but not limited to illegal or inappropriate conduct)which need the attention of each member of the board in cases where he/she intentionally ignores monitoring or control of corporate operations based on those systems. Under Daewoo, the director is responsible for any damages incurred by illegal corporate affairs of other directors or officers resulting from continuing or systematic negligence in monitoring them. The representative director remains subject to such liability regardless of how the internal work or responsibility is divided or delegated within the company. Interestingly, the Korean court’s standard is similar to the standard of the U.S. court in Caremark and the prescribed obligation to construct internal control systems and to maintain their functions under the Japanese Corporation Law. However, if the director finds any suspicious situation related to illegal corporate affairs, he/she should investigate or request the board of directors conduct on investigation. In addition, if the director finds any substantial illegality, he/she should announce it in public. This paper intends to provide a supplemental explanation of the Daewoo standard.