[2] In a case where the title trustee would have returned capital gains from the trust property acquired from the title trustee’s arbitrarily disposed of without the delegation or consent of the title truster to the title truster

[2] In order for a trustee to have returned capital gains from the trust property in the name of the title trustee who arbitrarily disposed of without the delegation or consent of the title truster to the title truster, it should be deemed that the title truster is in a position to substantially control, manage, and dispose of capital gains as he/she performs the delegated affairs immediately after he/she receives the transfer consideration, and the title truster can be deemed the principal agent of the transfer. Barring any special circumstance, the title truster cannot be deemed to have returned capital gains on the ground that he/she recovered the amount equivalent to capital gains after a considerable period of time has elapsed through a lawsuit against the title trustee.

1. Where a title truster transfers a title trust property at his/her own will, he/she is in a position to de facto control, manage, and dispose of capital gains, and thus, he/she is liable to pay capital gains tax. However, if a title truster arbitrarily transfers a title trust property without the delegation or consent of the title truster, if the title truster is not the title truster but the title truster is not in a position to de facto control, manage, and dispose of capital gains unless the capital gains are returned to the title truster, and thus the title truster cannot be deemed as a person liable to pay capital gains tax (see, e.g., Supreme Court Decision 98Du7084, Nov. 26, 199).

2. On November 8, 2003, the court below held that ① Nonparty 1 succeeded to the land of this case according to its inheritance shares; ② Nonparty 1’s mother after Nonparty 1’s death, asserted that part of the land of this case was owned by Nonparty 2, and filed a lawsuit against the Plaintiffs on November 21, 2003 claiming the registration of transfer of each of the plaintiffs’ shares out of the above land; ③ Plaintiff 1 delegated Nonparty 3’s husband to Nonparty 4, who was her husband, with the competent district court’s order to cancel the registration of transfer of ownership pursuant to the above 17 land of this case; ② Nonparty 2 filed a lawsuit against Nonparty 3, who was her husband, for the purpose of maintaining the inherited property such as this case’s land of this case, the court below held that Nonparty 3 was entitled to the registration of transfer of ownership under the name of Nonparty 1’s husband from November 27, 2003 to December 8, 2003; and ④ Nonparty 201 to the market value of the land of this case’s.

Based on these factual basis, the lower court determined that the instant disposition that imposed capital gains tax on the Plaintiffs by deeming the Plaintiffs as the taxpayer of capital gains tax on the ground that the transfer income tax, which Nonparty 3, a title trustee, arbitrarily disposed of 15 parcels of the instant land without the Plaintiffs’ delegation or consent, was lawful on the ground that the transfer income tax was fully returned to the Plaintiffs, the title truster, and the Plaintiffs were in a position to de facto control, manage, and dispose of the said capital gains tax.

2. However, such a determination by the lower court cannot be accepted for the following reasons.

A. In order for the title trustee to have returned capital gains accruing from the trust property that he/she disposed of at will without the delegation or consent of the title truster to the title truster, the title truster should be deemed the principal agent of the transfer, inasmuch as the title truster is in a position to substantially control, manage, and dispose of capital gains as he/she performs the delegated affairs immediately after he/she receives the transfer consideration, and barring any special circumstance, the title truster cannot be deemed to have returned capital gains on the ground that he/she recovered the amount equivalent to capital gains after a considerable period of time has elapsed through a lawsuit against the title trustee.

B. Examining the facts acknowledged by the court below in light of the aforementioned legal principles, Nonparty 3 did not voluntarily transfer to the Plaintiffs immediately upon receipt of the price for the transfer of the instant land, but paid the amount equivalent to the transfer price upon the formation of mediation after a considerable period of time in the litigation procedure instituted by the Plaintiffs, and thus, it cannot be deemed that the transfer income was returned to the truster. Therefore, it cannot be deemed that the Plaintiffs were in a position to substantially control, manage, and dispose of the transfer income at the time of the transfer of the instant land, or that they were the subject of the transfer of the instant land. Therefore, the Plaintiffs

C. Nevertheless, the court below held that the disposition of this case was lawful on the ground that the transfer income tax on 15 parcels of the instant land was returned to the Plaintiffs. In so doing, the court below erred by misapprehending the legal principles on the requirements for deeming that the title trustee would be liable to pay transfer income tax if the title trustee disposes of the title trust property at will without delegation or consent of the title truster, thereby adversely affecting the conclusion of the judgment. The ground of appeal assigning this error is with merit.

3. Therefore, the lower judgment is reversed, and the case is remanded to the lower court for further proceedings consistent with this Opinion. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Kim Yong-deok (Presiding Justice)