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The purpose of this paper is to search a system of joint suretyship and analyze a system of protection of joint surety in Japan. There is no clauses to protect joint surety in Bank Act of Japan, It is lawful though the bank violates an explanation duty and the bank does not hand over the document. The most banks of Japan do not demand the joint surety about loan of the enterprise and the individual. The most banks of Japan about loan of the enterprise and the individual are doing the stocks and the real estate etc. thing at mortgage. When guaranteeing, puts out a guarantee fee mainly at the bonding company and issues surety certificate. It is recognized the explanation duty of the financial agency about deposit etc. but It don't rneed the explanation duty because financing is not the financial goods. The Financial Supervisory Service revise guide line and is guiding in order to the bank must explanation duty in financial transactions between companies and customer. In order to relax a joint surety responsibility from Japan, The Financial Agencies supplies the funds.

Recently, how to modernize and improve suretyship system have been actively under discussion all over the world. There is an arising concern in Korea that the joint and several suretyship system should be subject to reform. One with money to lend, goods to sells or services to render may have doubts about a prospective debtor's ability to pay. The prospective creditor can reduce its risk by requiring some sort of security. In America One form of security is the Article 9 security interest in the in the debtor's goods. Another type of security takes the form of joining a third person on the debtor's obligation. Structurally suretyship is a three party relationship involving the creditor, principal debtor and the surety. Occasionally surety includes guarantor. The surety undertakes to 'back up' the performance of the debtor and thereby gives the creditor the added assurance of having another party to the obligation. It is common practice for a surety to appear on a note either as a co-maker or as a endorser. As between the surety and the debtor, it is clear that the debtor has the primary obligation to pay the debt. Mostly, perhaps exclusively the parties are co-signers of notes in cases where neither party is an accommodation party for the other -because each receives a direct benefit from the loan. In American jurisprudence, Chapter 1 of Restatement contains nosubstantive rules of suretyship and guaranty law. Nonetheless, it may well be the most important chapter in the Restatement. For it is this chapter that sets out the ground rules for the application of the substantive rules that appear in subsequent chapters. The substantive rules of suretyship and guaranty law are of little use without these ground rules. Sections 1 and 2 of the Restatement are the foundation upon which the substantive principles of suretyship and guaranty law are built. These sections determine the range of situations to which those substantive rules apply. The importance of these rules of scope should not be underestimated. The range of situations to which the law of suretyship and guaranty applies is often misunderstood, with the result that, in many transactions, the application of principles that protect the interests of secondary obligors(the surety, the guarantor) with respect to both debtors(principal obligors) and creditors (obligees) is unexpected by some or all of the parties. In Korea, traditionally a joint and several suretyship shall mean the right in rem over a specific property so as to recover creditor's claims, and should notify the public of its existence and priority. In conclusion, there is an amounting need for suretyship system, which could modify the rigidity of the current regime on suretyship system in Korea. By doing so, a joint and several suretyship system would increase the availability of credit and improve the terms of the credit. However, the modernization and diversification of the a joint and several suretyship system in Korea should be promoted so as to implement guaranty system.

Today, credit security systems have a pivotal role in economic activity. Among them, a joint surety system has been most commonly used as a security for small-loan finance in the existing banks. Such joint surety system has been treated as a convenient financial instrument because it is possible for the public to lend money relatively easily by providing a surety in case that a potential debtor needs money but lacking credit. In addition, in the side of creditor, joint surety has an economic function of facilitating the retrieval of debt by reducing uncertain risk involved in the provision of credit to a debtor. However, it may cause economic or mental hardship to a surety because it may trigger a heavy responsibility to the surety. Meanwhile, with respect to a joint surety system, many improvements have been made in the first-tier financial world, but many improvements are needed in other financial world and private loan markets. A joint surety is mainly used by ordinary people who lack physical security and have bad financial status, and in Korea many financial institutions (such as private moneylender or other financial institutions), different from other financial institutions in the developed countries, continue to carry out less advanced financial practices of loan by relying on a surety's financial ability rather than thorough inspection of a debtor's credit. It is expected that 'Special Act on Protection of Surety' which was enacted for improving such behaviors of financial institutions and protecting a surety will play a pivotal role in minimizing adverse effects of a joint surety system and maximizing its' positive effects in its operation. In addition, it is necessary to carry out a future institutional supplementation regarding a joint surety system of corporate CEO which is still performed by the first-tier financial world.

The lienholder in the individual rehabilitation proceeding can freely exercise the lien due to the fundamental guarantee of the right of rehabilitation. Some limitations are, however, exerted for the resuscitation of individual debtors: First, when the court acknowledges the need in case of requests for the initiation of the individual rehabilitation proceeding, the court may order suspension or prohibition of the auction for exercising the right of rehabilitation about the debtor's business or asset, with the request by the parties of interest or with the court's authority, until the determination about the request for initiation of the individual rehabilitation proceeding. Second, upon the verdict for the initiation of the individual rehabilitation proceeding, the auction for the exercise of the right of rehabilitation with the asset of individual rehabilitation organizations automatically suspends or is prohibited until the approved termination day for the rehabilitation plan. Accordingly, the lienholder is a right holder for rehabilitation in the individual rehabilitation proceeding however, a predicament is the impossibility of the right exercise from the time of the individual rehabilitation proceeding until the verdict for the rehabilitation plan. Noticeably, more unreasonable contents have incremented in the right of rehabilitation for debtors as copying the civil rehabilitation right of Japan. The broad restraining order system according to the civil rehabilitation law of Japan is a system that, for instance, orders the prohibition of compulsory execution for the asset of recovering debtor that exerts on the rehabilitation debt of recovering debtor, whereas Korea's broad restraining order system extended its range of prohibition of, for instance, compulsory execution of rehabilitation bond or rehabilitation lien even about the rehabilitation debtor as well as rehabilitation lienholder. Furthermore, the restraining order system of Japan sets a long period of time and orders the suspension of auction for the lien exercise in the asset of rehabilitating debtor. On the other hand, Korea's restraining order may request suspension or prohibition of the auction for the lien exercise in the debtor's business or asset, until the determination time for the initiation request for the individual rehabilitation proceeding, and when a verdict is stated for the initiation of the individual rehabilitation proceeding, the auction for the lien exercise for the asset belonging to individual rehabilitation organizations automatically suspends or is prohibited until the approved termination day for the rehabilitation plan. Moreover, Japanese law stipulates the court for a hearing by the auction declarant when making a verdict for suspension, Korean law, however, omits the process. Under such circumstances, the allegation for the exclusion of the lien out of the right for rehabilitation, by financial institutes on the housing owned by the debtor who requested for the individual rehabilitation proceeding can worsen justice and equality.

People have a tendency not to evaluate properly about risk of Surety Obligations, occur or extinct under the uncontrolled factors of Surety, because there is no actual burden in the signing of contract. Especially, it is hard to admit obligations as for Surety signing contract through the influence of human relations or earnest request, when it become actualized. Furthermore, 31.8% of the Surety have an experience of repaying principal and interest for the Principal Obligor. Therefore, not only the financial circle but also the legal circle, acknowledging about the harmful effect of surety obligations system, tried to minimize the harmful effect by various measures. However, the situation of Surety in the bankruptcy procedure has not been improved since the Bankruptcy Act or the Integrated Bankruptcy Act was enacted. In the contradictory result, the Surety still has a duty for surety obligations even if Principal Obligor bankrupted get their responsibility exempted The fundamental reason for the problem hereinto can be found in Article 567, the Bankruptcy Act including an exceptional provision for the principle of appendant nature in the Civil Law. In other words, the Surety enter into contract which would be appendant to the principal obligation at first, but that contract would be compulsory amended to the indemnity contract without appendant nature by certain policy in the future The condition to maintain Article 567 of Bankruptcy Act valid is observance of the proportionality principle such as legitimacy of the end, appropriateness of the means, proportionality of the legal interest (between the private person's interest being affected by the nation's rule and interest in achieving the proposed end), and finally, minimality of the infringement (of the private person's rights) However, this article make Surety to assume all expenditures for making disorder in the economic society which Principal Obligor or government are mostly in the responsibility. moreover, it make Surety to have supernumerary duty which cause a discriminatory treatment, compared with ordinary one. after all, Article 567, excluding the principleof appendant nature for Surety Obligations and not setting the rational limitation to make the bankruptcy procedure, infringes the proportionality principle and the egalitarian principle Therefore, it is explicitly unreasonable demand for the Surety, contrary to the proportionality principle and the egalitarian principle that even the Principal Obligor is exempted from liability by the bankruptcy procedure but the Surety still has liability under the certain procedure. Accordingly the obligation of Surety shall be exempted by taking only the limited responsibility that the Principal Obligor is actually burdened.

Individual debtor rehabilitation procedure is a legal system of designed for the effective rehabilitation and new start of individual debtors facing the financial difficulties though expected continuous or repeated future employment income or business income by adjusting the debt relations of both parties interested. Although a lot of pain involved such as to create a complex application forms and their compensation and to perform the long-term repayment plans, individual rehabilitation procedure which adjusts the interests of both parties of the debtor and creditors together to promote their interests is more just than individual bankruptcy proceedings. It should go through complicated procedures such as the authorization of repayment plans etc. But the bankruptcy court is favorable and going to guide to use this rehabilitation process active. In this article, we've seen an overview of the contents of individual rehabilitation procedure which performed after 6 and a half years have passed, and its philosophy and characteristics and its development process, especially compared with other bankruptcy procedures. Also we looked into many of the current personal rehabilitation issues, especially the pros and cons debate on the necessity of introduction of the "automatic stop" system, and Byeoljegwon (Absonderungsrecht, covered bonds) and its problems, the issuing of debt certificates, exemption or moratorium on the guarantor's liability, a joint application system of a couple, streamline of mutual conversion between insolvency procedures. For many such institutional issues, we have searched and thought out more effectiv ways to improve this procedure. In order to prevent individual debtors from showing an inclination toward individual bankruptcy and application for the exemption from responsibility, concealing their properties, and to increase the application of high valued individual rehabilitation procedure, the upgrade of this system and its operation is strongly required.