standing to sue to dispute the invalidity of the attachment disposition of shares;

The Plaintiffs merely a title trustee are not entitled to seek nullification of the attachment disposition of the shares.

Article 24 of the National Tax Collection Act

Daegu District Court 2015Guhap2040 ( December 21, 2016)

A and 61

Head of Namgu Tax Office

November 18, 2016

December 21, 2016

1. All of the instant lawsuits are dismissed.

2. The costs of lawsuit are assessed against the plaintiffs.

Cheong-gu Office

On September 22, 2014, the Defendant confirmed that each attachment disposition against the Plaintiffs’ shares issued by T Co., Ltd. is invalid.

1. Details of the disposition;

A. Status of the plaintiffs

Multimedia Media Co., Ltd. (hereinafter referred to as "M media") is a publishing company that runs the general book and textbook publishing business in Gangnam-gu Seoul, Gangnam-gu, in 193, and the plaintiffs are the shareholders of MM media ( Plaintiffs 1 through 64 are the total members of the employee stock ownership association, Plaintiffs 2, 40, 30, 3000, and 50,000). Meanwhile, M media changed its trade name to T Co., Ltd. on April 28, 2015 (hereinafter referred to as "T").

(b) Occurrence of preserved rights;

The director of the Seoul Regional Tax Office, on April 22, 2014, conducted a tax investigation into U with respect to U, notified the Defendant of the gift tax assessment data that U received a free payment of the exhibition service from a person with a special relationship. On July 1, 2014, the Defendant decided and notified the amount of KRW 15.35 billion of gift tax to U.S.

C. Disposition of seizure of this case

Under the premise that U’s death was revealed in July 2014, the Defendant: (a) the amount of gift tax of KRW 13.663 billion, which is anticipated to be succeeded to U’s heir; and (b) the heir is obligated to pay in the limit of the inherited property; (c) deeming that U, a real shareholder, held that the shares of this case were trusted in trust to the Plaintiffs; (d) the instant shares were inherited by the heir; and (e) on September 22, 2014, the Defendant seized the instant shares by providing notification of the seizure of the instant shares to M Media; and (e) on October 22 of the same year, the actual shares of this case were delivered from MV media.

(d) Implementation of the preceding trial procedures;

1) Summary of the plaintiffs' assertion in tax proceeding

① The instant shares are not nominally acquired through the employee stock ownership association (Plaintiff 1 through 64), or there is no ground to recognize the actual owner of the instant shares as U (Plaintiff 2 and C). The instant attachment disposition should be revoked.

② Even if the instant shares are owned by U, the Defendant did not meet the requirements under Article 24(1) or (2) of the National Tax Collection Act, and thus, the Defendant should release the seizure of the instant shares. ③ Although the Defendant should have notified the Plaintiffs, the nominal owner, of the seizure, of the seizure, the seizure notification was made only by M media. Since such administrative act is null and void, the seizure of the instant shares, regardless of the title trust of the instant shares.

(ii)decision of the Tax Tribunal;

On August 12, 2015, the Tax Tribunal determined that the actual owner of the instant shares was in title trust to the Plaintiffs by U.S.

[Ground of recognition] Facts without dispute, Gap evidence Nos. 1 and 2, the purport of the whole pleadings

2. The parties' assertion

A. The plaintiff

Since the instant shares were owned by the Plaintiff’s Intervenor and entrusted only the names to the Plaintiffs, the instant shares were subject to the property of a third party (Korean Association), rather than the taxpayers. The instant disposition is null and void as it is the subject of the property of the said third party (Korean Association). The Korean Association was donated from New Do E, and merged with “L store M” from New Do D, and entrusted the management of the said shares to the former, and its profits were increased several times on January 15, 1990. In other words, the instant disposition is null and void as it is impossible to legally realize the instant disposition on the property of a third party, not the taxpayers.

B. Defendant

U controlled the whole S Group by using I, comprehensively managed and supervised group affiliates, and intended to succeed management rights to children. M media also is one of the affiliates controlled and supervised as such.

B. Determination

1) Even if the tax authority seizes and sells the property owned by a third party as a disposition to collect delinquent taxes against a taxpayer, such disposition does not lose ownership by the third party, but is limited to the taxpayer’s property in any case or where the subject of seizure is limited to the taxpayer’s property, and thus, a disposition of seizure on the property owned by a third party, which is not the taxpayer, can not be legally realized (see, e.g., Supreme Court Decision 2000Da68924, Feb. 23, 2001).

However, there is no benefit in filing an administrative litigation, inasmuch as there is no benefit in filing an action only for a person who has a direct and specific benefit by law due to the revocation of the pertinent disposition by an administrative agency (see, e.g., Supreme Court Decision 2002Du1267, Sept. 23, 2003). Even if a seizure disposition is void as above, if there is no direct and specific benefit due to the seizure disposition, so long as there is no infringement of the legal interest due to the seizure disposition, it cannot be said that there is a standing to sue to seek a nullification of such seizure disposition (see, e.g., Supreme Court Decisions 96Nu3241, Feb. 14, 1997; 2003Du4959, Jul. 9, 2004).

2) In full view of the following circumstances in the instant case, the Plaintiffs should be deemed to have no standing to sue to seek revocation or confirmation of invalidation, inasmuch as they have a de facto and indirect interest in the disposition of seizure of the instant shares, and do not have a direct and specific interest in law.

① In the instant lawsuit, the Plaintiffs asserted that, while the instant shares are not owned by themselves, the actual owner (title truster) is not U but the Plaintiff’s Intervenor, the disposition of seizing the instant shares is null and void, not U.S. shares. In other words, even based on the Plaintiffs’ assertion itself, they are merely merely a title trustee and do not have actual rights ( Plaintiff 1 through 64 asserted that they are the actual owners of shares in their names as members of the employee stock ownership association at the tax trial stage, but the Plaintiff’s Intervenor withdrawn the said assertion in the instant lawsuit, and argued that the Plaintiff’s Intervenor is the actual owner). Accordingly, it cannot be said that the Plaintiff’s direct and specific benefit infringement due to the instant attachment disposition is the Plaintiff’s Intervenor (or the Plaintiff’s assertion) or U’s heir (or the Defendant’s assertion), and that there is a change in the Plaintiffs’ rights and legal status depending on the validity of the attachment disposition.

② Even if an asset subject to seizure is real estate under a title trust, the ownership is externally attributed to the title trustee pursuant to the legal principles of title trust, and thus, there is a legal interest in seeking confirmation of the seizure disposition on real estate against the title trustee. However, in the case of a stock, only the nominal borrower who actually accepted the stock and paid the price is the real subscriber, and is to become a shareholder in external relations regardless of whether the title truster takes the procedure of transfer, etc. from the title truster, and a mere title truster cannot become a shareholder (see, e.g., Supreme Court Decisions 97Da50619, Apr. 10, 1998; 2007Da70599, 70605, Mar. 27, 2008).

Therefore, it cannot be deemed that there is a legal interest in dispute over the invalidity of the disposition of seizure of shares against the plaintiffs who are merely the nominal lender of shares in this case, and the standing to sue or legal interest in dispute over the seizure disposition in this case should be deemed to be in principle against the plaintiff supplementary intervenor who asserts the ownership of shareholders' rights.

③ The instant attachment disposition is based on the premise that U and his heir were beneficial owners of the instant shares on the grounds that U and the instant disposition was in arrears. Therefore, the Plaintiffs cannot be deemed to have standing to sue to seek revocation as the other party to the tax administrative disposition imposed by the tax authority.

④ If the Plaintiff’s Intervenor actually owns the shares of this case, the Plaintiff’s Intervenor would have to dispute the validity of the attachment disposition of this case by filing a suit seeking a nullification of the attachment disposition of this case as a direct party (However, as seen below, it is necessary to review the legitimacy of the suit) or by filing a suit seeking a revocation of the attachment disposition of this case pursuant to Articles 50 and 53 of the National Tax Collection Act and then filing a revocation suit against the rejection disposition of this case.

⑤ That is, the seizure of a claim is only a relative effect between the tax authority that is the execution creditor and the taxpayer that is the debtor, and if the seized claim falls under the possession of a third party that is not the taxpayer, such seizure disposition is not effective as it is the seizure of a claim that does not exist. Moreover, even if a claim that does not belong to the taxpayer is seized, there is no influence on the legal relationship of the third party that is the real right holder, and thus, the third party may dispose of the claim, and the third party may claim the performance of the obligation to the third party, and the third party is not prohibited from performing the obligation to the third party. Therefore, even if the tax authority seized the claim reverted to a third party that is not the taxpayer, the third party is not subject to the infringement of the legal direct and specific interest due to the seizure disposition, and thus, it is in principle that the third party has no standing to seek the revocation or nullification of the seizure disposition (see Supreme Court Decision 2003Du4959, Jul. 9, 200

However, the third party, who is the subject of the seized claims, may seek remedies by filing a lawsuit seeking revocation against the disposition of rejection (see, e.g., Supreme Court Decision 92Nu1505, Apr. 27, 1993).

3) If so, the instant lawsuit is deemed unlawful since it is filed by a person who has no standing to sue, and thus, it shall be dismissed without proceeding to decide on the merits as to who is the actual owner of the instant shares.

4. Conclusion

All of the instant lawsuits are dismissed, and it is so decided as per Disposition.