13. Case on Criminal Punishment of Those Who Issued a Check but Failed to Pay

[23-2(A) KCCR 65, 2009Hun-Ba267, July 28, 2011]

The Constitutional Court held that Article 2 Section 2 of the Illegal Check Control Act, which imposes criminal punishment on a person who has issued or drawn up a check but fails to pay the check bythe specified date due to shortage of deposits, suspension of transactions,or cancellation or termination of a check contract, is not against the Constitution because that provision violates neither the rule against excessive restriction nor the principle of equality. The Court also held that the provision does not amount to be an infringement on the dignity of human beings because it does not compel the issuer or the drawer to discharge debts on security of his or her body.

Background of the Case

Petitioner was charged with violating the Illegal Check Control Act (hereinafter, the "Act") and thereafter convicted because, although the check he had issued was legally presented to be paid, he failed to pay the check due to suspension of transactions.

Against the Court's conviction, the petitioner filed an appeal with the Jeju District Court and, while the case was pending, moved thecourt to file a request with the Constitutional Court for a constitutionalreview of the provision at issue, Article 2 Section 2 of the Illegal Check Control Act (hereinafter, the "Instant Provision"), but the Court denied that request. In response, on October 9, 2009, the petitioner filed this constitutional complaint.

Provision at Issue

Illegal Check Control Act (revised by Act No.1747 on February 26, 1966, but before revised by Act No.10185 on March 24, 2010)

Article 2 (Criminal Responsibility of Issuer of Illegal Checks)

(2)Section(1) shall also apply in cases where a person who has issued or drawn up a check fails to pay the check by the specified date due to shortage of deposits, suspension of transactions, or cancellation or termination of a check contract.

Summary of Decision

1. Court Opinion

The decisions on what kind of conduct constitutes a crime or what penalty shall be imposed are basically questions of legislative policy so that wide legislative discretion or legislative policy-making power in making those decisions shall be recognized. We find that the Instant Provision is considered to be a proper means to achieve legitimate purposes of the Act because the Provision aims to stabilize national economic life and secure the functions of checks by restricting the conduct which betrays public trust on a check as a negotiable instrument and by securing payment thereof. In addition, it is hard to regard the legislative's determination as arbitrary when, in light of the reality where the number of crimes violating the Act is more than ten thousand cases per year, the legislature may rightly consider that a mere imposition of light punishments such as a charge of fine or financial sanctions is not sufficient to achieve the aforementioned legislative purposes. Moreover, the public interest aims of the Instant Provision - securing the functions of checks and stabilizing national economic life by securing payment of checks - is very important, while the private interests to be restricted do not appear to be significant. Therefore, the Instant Provision does not violate the rule against excessive restriction.

Petitioner asserts that the Instant Provision discriminates against the issuer of check by favoring the issuer of a promissory note. However, a check in its nature of negotiable instrument as a substitute for cash, is inherently different from a promissory note and thus, the issuer of a check and the issuer of a promissory note shall not be treated as the same group or, even in the instance where they can belong to the

same group, a different treatment between them shall be deemed to have reasonable grounds.

On the other hand, the petitioner argues that the application of the Instant Provision to the check issued for credit purposes not only goes beyond the scope necessary to achieve the purposes of the Act but also violates the principle of equality. However, the Court disagrees with this argument because it is almost impossible for ordinary people to tell whether a check has been issued for credit purposes since such check cannot be differentiated from the other ordinary checks in appearance. Moreover, those checks issued for credit purposes can always be circulated. For the foregoing reasons, this Court concludes that there is still a reasonable basis to treat a check issued for credit purposes the same as the ordinary checks.

We also cannot accept the petitioner's contention that the Instant Provision either infringes on the dignity of human beings or violates international law because that provision is not for compelling the payment of debt on security of the petitioner's body but only for ensuring the primary function of a check by punishing the conduct which betrays the public's trust on a check as a negotiable instrument.

2. Dissenting Opinion of Two Justices

The language of the Instant Provision is so vague in itself that we can hardly determine whether the conduct required to be the element of the crime is either 'the act of issuing or drawing a check' or 'the act of failing the payment by the specified date,' when the crime is deemed committed, what constitutes criminal intent, or when that criminal intent should exist. Furthermore, even with the assistance of the interpretation of the Supreme Court, the individuals subject to the provision, from the wording of the Instant Provision, can hardly foresee what acts will make him or she criminally liable.

By prescribing suspension measures as one of the elements of the crime even though the criminal intent of the issuer of the suspended check cannot be involved in such measures, the Instant Provision,

which is to punish intentional offences, increases the vagueness in termsof its interpretation.

In light of other countries' legislation, it is rare that an issuer of a check is criminally liable only because his or her check has bounced and, even in the case when he/she is to be punished, the provision for such punishment is very strict and clear.

For the foregoing reasons, in our view, the Instant Provision violates the rule of clarity and therefore, is against the Constitution.