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| TITLE | Supreme Court en banc Decision 2012Da1146, 1153 Decided September 26, 2013【Unjust Enrichment, etc.】 [full Text] |
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| Summary | |
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[1] Where a knock-in knock-out (“KIKO”) currency option contract which Company A signed with Company B (bank), etc. was challenged as unfair practice, the case upholding the lower court’s decision that the said contract did not constitute an unfair practice [2] Where one party in a contract prepared a particular type of contract in advance but underwent separate negotiations for specific clauses in the contract, whether the clause is subject to the Act on the Regulation of Terms and Conditions (negative), and the conditions to acknowledge the existence of separate negotiations [3] Where the issue was whether a KIKO currency option contract which Company A signed with Company B, etc. is subject to the Act on the Regulation of Terms and Conditions, the case holding that the structure of the contract in itself does not fall under terms and conditions [4] Where a bank sells a zero-cost over-the-counter (“OTC”) derivatives to a customer, whether the bank is obliged to inform the customer of the option’s theoretical value, fees, and resulting negative market value included in the product structure (negative in principle) [5 ]Content and degree of a bank’s duty to protect customers when it signs a currency option contract with a company seeking to hedge against foreign exchange risk [6] Content, scope, and degree of a financial institution’s duty to explain when it engages in OTC derivatives transactions ?which requires professional knowledge and analytical skill ?with general customers [7] Where Company A ?after signing two KIKO currency option contracts with Company B and engaging in foreign exchange hedging transactions on expected foreign currency inflow ?signed an additional KIKO currency option contract with Company C upon active recommendation and explanation by Company C’s branch manager who was aware of the aforementioned transactions, but incurred loss due to a sudden rise in exchange rates which prompted Company A to seek damages against Company C on grounds of violating the principle of suitability, etc., the case holding that Company C violated the principle of suitability and the duty to explain [8] Where comparative negligence is not exceptionally allowed despite the fact that a victim was at fault in the incurrence or expansion of losses caused by tort |
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