粉飾會計로 인한 理事의 民事責任 대법원 2008.1.18. 선고 2005다65579 판결

This study analyses the 2008 Supreme Court decision(2008.1.18. 2005da65579), which involves directors’ civil liability arising from accounting fraud. In the case, the Supreme Court examined the dispute with reference to the conditions of a director’s liability towards third parties, the causality between the accounting fraud and the injury, the status of the assignee of the claim, the determination of the scope and amount of damages, and so forth. The court based its decision on the dominant theory taken by commentators. As the main part of this study shows on the basis of an examination of each issue, the decision is on the whole sound. The standards set by the decision have, however, limitations in solving actual problems related to liabilities arising from accounting fraud. It has to be pointed out in particular that the damages, namely the amount fraudulently misrepresented or deceitfully recorded (or embezzled) does not always coincide with the consequences upon the company, the third parties, and the market as a whole. The damage to the interested parties (third parties and shareholders) incurred by an accounting fraud may multiply indefinitely, involving such injuries as disadvantages in mobilizing capital from the financial market. The massive scale of injury and the multiple layers of repercussion are characteristic features of the damages in the capital market, which make it differ from the logic of ordinary civil compensations. Also difficult is to decide on accounting technicalities such as the problem of profit management, which is widely seen in corporate practice. Deeper inquiry is needed with regard to these issues, while legal rules governing accounting and auditing need to be tuned up. More fundamentally, the accounting environment should be made more transparent and efforts should be made to improve the accounting system in accord with international standards.