Civil Litigation Attorney | Assisting the Client Who Requested a Civil Action for the Return of Commissions and Obtaining a Decision for Full Payment

The client, the plaintiff who requested assistance from a civil litigation attorney, operates an insurance agency business, and the defendant is a person who had entered into an insurance solicitor engagement agreement with the client.

The defendant worked as an insurance solicitor affiliated with non-party Company A, which is a subsidiary of the plaintiff, and with the plaintiff's company, and the plaintiff paid commissions during that period.

Under the engagement agreement concluded between the plaintiff and the defendant, it was agreed that when an insurance contract solicited by the defendant lapsed or was terminated, he would ‘repay part of the commissions received in accordance with the clawback standards.’

Afterward, the defendant submitted a letter of resignation to the plaintiff, stating that he would establish an independent corporation, and 10 of the insurance contracts for which the plaintiff had paid the defendant solicitation commissions lapsed or were terminated early due to non-payment of premiums.

The plaintiff therefore demanded approximately 40 million won in clawbacks under the contract, but the defendant did not pay the commissions, arguing that he had only entered into an engagement agreement with non-party Company A, the plaintiff's subsidiary, and had not also entered into an insurance solicitor engagement agreement with the plaintiff, and that there was no material showing that he had agreed to apply the clawback standards the plaintiff claimed.

The client decided to file a claim for the return of commissions and requested assistance from a civil litigation attorney.

The civil litigation attorney submitted as evidence the records of the payments the plaintiff had made to the defendant.

The bank account records show that the defendant received commissions from non-party Company A for a certain period, and from then on received commissions from the plaintiff's company.

Based on these records, the civil litigation attorney emphasized that from a certain period the defendant had worked under the plaintiff and, given that he had received commissions for insurance solicitation, had entered into an engagement agreement.

In addition, non-party Company A is a corporation that, when it first began business, initially operated as an agency branch under the plaintiff, and later established a separate corporation in order to conduct a specialized business.

In other words, the relationship between the plaintiff and non-party Company A is one of mutual cooperation and support.

When a salesperson such as the defendant joins, the person enters into an engagement agreement with each of the two companies, the plaintiff and non-party Company A, and engages in sales activities.

The civil litigation attorney explained the relationship between non-party Company A and the plaintiff's company, and emphasized that an engagement agreement had been established.

The plaintiff, who operates an insurance agency business, receives insurance solicitation commissions from insurance companies, and pays part of them as commissions to the affiliated insurance solicitors who actually brokered the conclusion of the insurance contracts.

However, if an insurance contract lapses through termination or the like within a certain period, the insurance company may claw back all or part of the commissions paid to the plaintiff, and accordingly the plaintiff likewise, when entering into an engagement agreement, concludes an agreement with the insurance solicitor to claw back the commissions paid in advance if the insurance contract is not maintained.

The civil litigation attorney argued that this practice is a custom in the insurance industry that all insurance solicitors are well aware of, and that it was reasonable to find that the defendant had included such a commission clawback agreement when entering into the engagement agreement with the plaintiff.