[1] Whether embezzlement is established in a case where a member voluntarily consumeds the price acquired from the disposal of the property of a cooperative (affirmative), and whether the same legal principle applies to the so-called “in-house cooperative” (affirmative)

[2] Whether a counterpart business operator is in the position of a person who keeps another's property with respect to money and other property invested by an undisclosed partner for business (negative), and whether embezzlement is established where a business operator arbitrarily consumess business profits, etc. (negative)

[3] The standard for determining which legal relationship constitutes either the so-called “in-house partnership” or the “in-house partnership”

[4] In a case where the Defendant purchased and reselled a specific land with Party A, agreed to settle the resale profit after the purchase and resale thereof, and then completed the registration of transfer of ownership in the name of the Defendant, etc., but was prosecuted for embezzlement by refusing to return the resale profit to Party A after selling the said land at will to a third party, the case holding that the Defendant’s agreement with Party A constituted an anonymous association, and thus, constitutes a crime of embezzlement

[1] Since the property of a union belongs to the partnership's joint ownership, if one of the union members arbitrarily consumes the proceeds acquired from the disposition of the union's property, the crime of embezzlement cannot be exempted. This legal doctrine also applies to a so-called internal union whose relationship is not revealed externally, even though it is an internal partnership relationship.

[2] Unlike a cooperative or internal cooperative, in the case of an anonymous association, since the money or other property invested by the undisclosed partner for business is the property of the other party, the business operator is not in the position of the person who keeps another's property, and therefore, even if the business operator arbitrarily consumes business profit, etc., embezzlement cannot be established.

[3] Whether a certain legal relationship constitutes an internal partnership or an anonymous association shall be determined by comprehensively taking into account the following factors: (a) whether there is a joint business between the parties; (b) whether a partner was involved in the partnership’s business with the right to inspect the business affairs; and (c) whether the consent of all members

[4] In a case where the Defendant purchased and reselled a specific land with Party A, agreed to settle the resale profit, and then the registration of transfer of ownership was completed in the name of the Defendant, etc., but the Defendant was charged for embezzlement by refusing to return the resale profit to Party A after arbitrarily selling the said land, the case denying the establishment of embezzlement on the ground that the Defendant’s agreement is not an association or internal association, but an act of management based on the right of supervision, etc., even if Party A invested a certain amount for the purpose of obtaining gains from the resale profit, and it was clearly possible for the Defendant to dispose of the property without any restriction, on the ground that the agreement between the Defendant and Party A is not an association or internal association, and it constitutes “a bearer contract similar to an undisclosed association” on the ground that Party A was not in the position of a person who keeps another’s property.

[1] Article 355 (1) of the Criminal Code / [2] Article 355 (1) of the Criminal Code, Article 79 of the Commercial Code / [3] Article 79 of the Commercial Code / [4] Article 35 (1) of the Criminal Code, Article 79 of the Commercial Code, Article 325 of the Criminal Procedure Act

[1] Supreme Court Decision 2007Do10645 Decided February 14, 2008, Supreme Court Decision 2009Do7423 Decided October 15, 2009, Supreme Court Decision 2010Do17684 Decided June 10, 201 (Gong201Ha, 1428) / [2] Supreme Court Decision 71Do2032 Decided December 28, 1971, Supreme Court Decision 72Do2704 Decided April 30, 2009, Supreme Court Decision 2007Do924 Decided February 14, 2008 / [3] Supreme Court Decision 2007Do10645 Decided February 14, 2008

Defendant

Prosecutor

Suwon District Court Decision 2009No2899 decided April 2, 2010

The appeal is dismissed.

The grounds of appeal are examined.

Since a union's property belongs to a partnership member's joint ownership, if one of the union members arbitrarily consumes the proceeds acquired from the disposition of the union's property, it cannot be exempted from the liability for embezzlement. This legal principle also applies to a so-called internal union whose cooperative relations are externally revealed (see Supreme Court Decisions 2007Do10645, Feb. 14, 2008; 2009Do7423, Oct. 15, 2009; 2009Do7423, Oct. 27, 2009). However, in the case of an anonymous association, since the association's property belongs to a partner's own property as a part of the other company's property, if the business operator arbitrarily consumes the business profit, etc. without the status of the person who keeps the other's property, it cannot be established even if the business operator used the business profit, etc. without the consent of all the parties to the association (see Supreme Court Decisions 201Do2032, Dec. 28, 2001).

According to the reasoning of the judgment below and the evidence duly adopted by the court below and the court of first instance, the victim non-indicted 1 and the defendant purchased three parcels of land located in Yan-Eup in Yangju-si (hereinafter "the land in this case") on or around September 2002, and reselled the land and agreed to settle the proceeds from resale thereof. The defendant purchased the land in this case on or around November 2002, but the ownership transfer registration was completed in the name of himself and non-indicted 2 and 3. The victim entirely transferred the purchase and resale of the land in this case to the defendant and did not participate entirely in the process of purchasing the land in this case, and the defendant did not participate entirely in the process of selling the land in this case on or around April 2007. Thus, even if the victim did not participate in a certain amount of money for the purpose of acquiring the proceeds from resale of the land in this case, the agreement between the defendant and the association cannot be seen as constituting an anonymous association or association without any restriction.

Although the reasoning of the judgment of the court below is not sufficient, it is justified in its conclusion that the defendant is not in the position of a person who keeps another's property, and thus, it is not erroneous in the misapprehension of legal principles as to the establishment of embezzlement, as otherwise alleged in the ground of appeal.

Therefore, the appeal is dismissed. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Lee In-bok (Presiding Justice)