Seoul Administrative Court 2013Guhap20790 ( October 02, 2014)

It is difficult to deem that the instant deposit was received free of charge by the Plaintiff.

Since the other party has adjusted all the legal disputes arising from improper relations with the Plaintiff in order to resolve them on a daily basis, it is reasonable to deem that the deposit received by the Plaintiff based on the above adjustment is the amount paid by the other party as agreed upon in order to settle legal disputes with the Plaintiff, and it is difficult to see that the money received by the Plaintiff without compensation.

Article 2 (3) of the Inheritance Tax and Gift Tax Act

2014Nu51366 Revocation of Disposition of Imposition of Gift Tax

AA

BB Director of the Tax Office

Supreme Court Decision 2013Guhap20790 Decided May 2, 2014

March 3, 2015

March 24, 2015

1. The defendant's appeal is dismissed.

2. The costs of appeal shall be borne by the Defendant.

1. Purport of claim

The judgment that the disposition of imposition of gift tax of KRW 000,000,000 (including penalty tax) imposed on the Plaintiff on September 1, 2012 by the Defendant is revoked.

2. Purport of appeal

The judgment of the first instance is revoked and the plaintiff's claim is dismissed.

1. Details of disposition;

The following facts are not disputed between the parties, or may be acknowledged by adding to the whole purport of the pleadings, Gap evidence Nos. 1, 2, 3, 4, 10, 15, and Eul evidence Nos. 1 and 2 (including the serial number; hereinafter the same shall apply):

A. CCC (CCC) is the representative director of DD Energy Co., Ltd. (hereinafter referred to as "DD"), and the Plaintiff was working as the head of DD international business team from July 200 to January 2000 after graduating University was graduated from the U.S. GG University. B. The Plaintiff received KRW 0 billion from CCC and completed the investigation into the instant apartment on December 31, 2007, with the EE and Gangnam-gu Seoul Samsung Xx x x 0000,000 (hereinafter referred to as "the instant apartment"), from January 200 to January 200, 200, and completed the investigation into the instant apartment lease contract under the name of CCC (hereinafter referred to as "CCC") on January 20, 200.

D. Afterwards, CCC requested the Plaintiff to complete the registration of chonsegwon in the future, and was rejected. Based on the written statement of this case, CCC filed a lawsuit against the Plaintiff (Seoul Central District Court 2009Gahap0000, hereinafter referred to as “related lawsuit”) seeking the implementation of the procedures for the registration of chonsegwon on the apartment of this case, and was rendered a favorable judgment on X. X. of X.

E. Accordingly, the Plaintiff filed an appeal and the appellate court (Seoul High Court 2009Na0000) reached an adjustment on February 1, 2000, as follows.

1. Of the 0 billion won claim for the return of the deposit for lease on a deposit basis with respect to the apartment of this case, 00 billion won is confirmed to CCC, and the remaining KRW 00 billion is to be the Plaintiff

2. The Plaintiff out of the apartment of this case from March XX, 200 to March XX, 200, and immediately exercise the right to claim the return of the deposit for lease on a deposit basis with the CCC, and is paid the amount set forth in paragraph 1 above.

3. The CCC shall withdraw, jointly with the Plaintiff, the application for provisional seizure against the right to lease on a deposit basis, the application for provisional seizure against the right to lease on a deposit basis, the application for provisional seizure against claims, and the provisional disposition against automobile disposal, and cancel the execution thereof

4. The Plaintiff confirms that JS350L (000) ownership of a passenger car belongs to CCC, and implements the procedures for transferring the ownership of JS350L to CCC on March 200, 200, and delivers the car.

5. CCC shall withdraw a claim for the transfer of ownership with respect to J-Motor vehicles within seven days from the date on which the conciliation becomes final and conclusive.

6. waives the remainder of the CCC claims.

7. It is confirmed that there does not exist any obligation other than those provided for in the above provisions between the CCC and the Plaintiff, and CCC and the Plaintiff do not impose any civil action or criminal complaint as to the instant case in the future and shall not be charged with any civil liability.

8. The total costs and expenses for conciliation shall be borne by each person;

f. Based on the above adjustment, the Plaintiff received KRW 00 million from X. X. EE, on the other hand, the Defendant deemed that the Plaintiff received KRW 00 million from EE as donated money from CCC, and imposed gift tax of KRW 00,000,000 (including additional tax) on the Plaintiff on January 1, 201 X.”, “The Plaintiff appealed to the Tax Tribunal on X. 2002, but was dismissed on X. X. 2002.

2. Whether the disposition of this case is legitimate

A. The parties' assertion

1) The plaintiff's assertion

The Plaintiff asserts that the instant disposition was unlawful on a different premise, on the following grounds: (a) the Plaintiff’s deposit amount of KRW 00 million received based on the instant conciliation was paid to the Plaintiff to settle all legal disputes with the Plaintiff early, including the Plaintiff’s mental suffering and property damage; and (b) the Plaintiff did not receive money from the CCC free of charge.

2) The defendant's assertion

The Defendant asserts that the instant disposition is lawful, in light of the following: (a) there is no reason to pay consolation money or damages to the Plaintiff; and (b) KRW 00 million received by the Plaintiff, considering the fact that part of the Plaintiff asserted that the deposit was donated to the Plaintiff in the relevant lawsuit was recognized as part of the money; and (c) it is reasonable to deem that the instant disposition was lawful.

B. Relevant statutes

The entries in the attached Table-related statutes are as follows.

C. Determination

1) Relevant legal principles

Article 2(3) of the Inheritance Tax and Gift Tax Act (amended by Act No. 10361 of Jun. 8, 2010) provides that "donation" means a free transfer (including transfer at a remarkably low price) of tangible and intangible property (including transfer at a substantially low price) or an increase in the value of another person's property by directly or indirectly means that can calculate economic values, regardless of the name, form, purpose, etc. of such act or transaction, or an increase in the value of another person's property by the contribution. Therefore, any consideration for the purpose of receiving a contribution from the other party according to its own contribution, that is, a mutual exchange condition or a quid pro quo relationship, shall not be considered as a donation, and there is no need to form a quid pro quo relationship.

2) Facts recognized

The following facts may be acknowledged by adding the whole purport of the pleadings to Gap evidence Nos. 7, 8, 11, 12, 13, 14, and 19 and the testimony of the CCC by the witness of the first instance trial (except for the following portion not trusted), and some of the CCC testimony contrary thereto is difficult to believe.

A) The CCC, while not legally divorced from a spouse in the United States, has been living together with a person living together in the Republic of Korea, and between them.

B) Nevertheless, the CCC used the following facts: (a) it was intended to establish an inappropriate relationship with the Plaintiff from the time when the Plaintiff became a member of the DD representative director; and (b) it took advantage of the fact that there was a friendly relationship with the world, and (c) considered the Plaintiff as an abnormal person, and led the Plaintiff to a defect in and out of the society; (d) it made various kinds of precious metals, handbags, etc., and sent text messages expressing love and patriotism.

C) Accordingly, the CCC, which acquired the Plaintiff’s mind, established an inappropriate relationship with the Plaintiff, and introduced the Plaintiff as its head or researcher to the persons who met with the business relationship.

D) Meanwhile, the Plaintiff prepared and issued the instant statement to CCC was also helpful for CCC to be subject to a non-suspectable measure against embezzlement, and CCC promised on September 2, 2008 to pay the Plaintiff KRW 00 billion to the Plaintiff by 20 XX. XX..”

E) After that, the relationship between the Plaintiff and CCC has become more important, the Plaintiff’s defect in X. X., and as seen earlier, CCC filed a related lawsuit against the Plaintiff, and the Plaintiff asserted that CCC was also considered to file a complaint against the Plaintiff as a crime of marriage prestigating.

3) Determination

In light of the above facts and the following circumstances acknowledged by comprehensively taking account of the developments leading up to the disposition and the above facts, since CCC adjusted all legal disputes arising from inappropriate relationships with the Plaintiff, it is reasonable to deem that CCC paid 00 million won deposit from EE based on the above adjustment to be the amount agreed upon by CCC in order to settle legal disputes with the Plaintiff, and it is difficult to deem that the Plaintiff was “free of charge from CCC.”

① Although the Plaintiff developed with CCC as an inappropriate relationship with CCC despite its knowledge of the existence of spouse, such relationship came from the establishment of a labor relationship that the Plaintiff had to become a member of CCC at the young age (CC) and undergo direction and supervision of CCC, its representative director. CCC, despite its management owner’s duty to protect its employees, has breached this duty and led the Plaintiff to an inappropriate relationship. Ultimately, the CCC’s act does not in itself constitute tort and constitutes a legal liability for damages incurred to the Plaintiff or property damage to the Plaintiff, even if it appears that the Plaintiff did not have any legal liability to seek compensation for damages arising out of CCC’s establishment of a title trust agreement against the Plaintiff, even if it appears that the Plaintiff did not have any legal liability to seek compensation for damages due to sexual harassment against the Plaintiff in Korea without divorce with his spouse in the United States.

Therefore, the plaintiff's assertion that the prior disposition of this case is unlawful and pointing this out is with merit.

3. Conclusion

Therefore, the plaintiff's claim is accepted, and the judgment of the court of first instance is just in conclusion, and the defendant's appeal is dismissed as it is without merit, and it is so decided as per Disposition.