[1] Whether the property of another person, who is the object of the crime of embezzlement, is owned or affected by the establishment of the crime of embezzlement (negative)

[2] In a case where the defendants conspired to deliver the goods supplied by the damaged company Gap et al., such as Gap corporation et al., as the subsidiary company of the victimized company Eul et al., and used the goods to be supplied by the victimized company for the purpose of paying wages by receiving the goods to the account in the name of the subsidiary company, the case holding that the crime of embezzlement is not established depending on the denial of legal personality in the case where the defendants embezzled the prices of goods supplied by the victimized company using the account of the victimized company's subsidiary company

[1] The crime of embezzlement is a property crime against another person's property, whose legal interest is the principal right such as ownership of property. Therefore, as long as the object of embezzlement belongs to another person's property, it does not affect the establishment of the crime of embezzlement.

A stock company is an independent right holder separate from shareholders, and thus its understanding does not necessarily coincide. Thus, if a shareholder, representative director, or a person who manages de facto affairs concerning the custody or operation of company funds, disposes of the company's assets for private purposes without permission, embezzlement is established.

[2] The case holding that in case where the defendants conspired to deliver the goods supplied by the damaged company Gap et al., such as Gap corporation et al., and used the goods to be supplied by the victimized company for the purpose of paying wages to Eul et al. by receiving the accounts in the name of the subsidiary, etc., the crime of embezzlement is not established on the ground that the defendants' act of denying corporate personality or abusing corporate personality is disregarding corporate personality even if it is corporate in exceptional cases where it can be seen that the victimized company abused corporate personality, and thus, they held that the defendants' act of embezzlement depends on the denial of corporate personality in the case where they embezzled the goods supplied by the victimized company using the account of the victimized company's subsidiary.

[1] Articles 355(1) and 356 of the Criminal Act / [2] Articles 30, 355(1), and 356 of the Criminal Act; Article 3(1)2 of the former Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Amended by Act No. 15256, Dec. 19, 2017)

[1] Supreme Court Decision 99Do1040 Decided July 9, 199 (Gong1999Ha, 1677) Supreme Court Decision 2010Do17396 Decided March 24, 201 (Gong2011Sang, 893) Supreme Court Decision 2013Do658 Decided August 30, 201 (Gong2016Ha, 1564) (Gong2016Ha, 1564)

Defendant 1 and one other

Defendants

Law Firm, Attorneys Lee Ho-hoon et al.

Seoul High Court Decision 2019No561 decided June 27, 2019

All appeals are dismissed.

The grounds of appeal are examined (to the extent of supplement in case of supplemental appellate briefs not timely filed).

1. The crime of embezzlement is a property crime against another person’s property, the legal interest of which is protecting the principal right, such as ownership of property (see, e.g., Supreme Court Decision 2013Do658, Aug. 30, 2016). Therefore, insofar as the subject of embezzlement falls under another’s property, it does not affect the establishment of the crime of embezzlement.

A stock company is an independent right holder separate from shareholders, and thus its understanding does not necessarily coincide. Thus, if a shareholder, representative director, or a person who manages de facto affairs related to the custody or operation of the company's funds disposes of the company's assets for private purposes, then embezzlement is established (see Supreme Court Decisions 99Do1040, Jul. 9, 199; 2010Do17396, Mar. 24, 201, etc.).

Of the facts charged against Defendant 1, the lower court upheld the judgment of the first instance court that convicted Defendant 2 of the violation of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Embezzlement) and the facts charged against Defendant 2. Examining the reasoning of the lower judgment in light of the aforementioned legal doctrine and evidence duly admitted, the lower court did not err by failing to exhaust all necessary deliberations, exceeding the bounds of the principle of free evaluation of evidence inconsistent with logical and empirical rules,

The Defendants asserted to the effect that the lower court erred by misapprehending the legal doctrine on the premise that the lower court applied the legal doctrine of denial of legal personality. However, such assertion cannot be a legitimate ground for appeal, as it is asserted only when the Defendants were to be the grounds for appeal or the lower court did not have decided ex officio. Furthermore, according to the reasoning of the lower judgment, it is difficult to view that the lower court specified the victim of embezzlement by applying the legal doctrine

In exceptional cases where it is possible to deem that a company has abused its legal personality, the law of denial or abuse of legal personality disregards the legal personality of the company and imposes liability on the person behind it later. In this case where the defendants embezzled the price of supplied goods of the victimized company using the account of the victimized company’s subsidiary, the crime of embezzlement is not determined depending on whether the crime of embezzlement is denied

2. The Defendants’ assertion that the lower court erred by misapprehending the legal doctrine on the subject matter and reliability of confession, the intent of embezzlement and the intent of unlawful acquisition, and the intention of unlawful acquisition is not a legitimate ground for appeal as it asserted in the grounds for appeal or that the lower court did not make ex officio decisions. In light of the evidence duly admitted, the lower court did not err by misapprehending the legal doctrine on the subject matter and reliability of confession, the intent of embezzlement and the intent of unlawful acquisition, or by exceeding the bounds of the principle of free evaluation of evidence, contrary to what is alleged in the grounds of appeal, in so determining, contrary to what is alleged in the grounds of appeal.

3. The Defendants’ appeals are without merit, and all of them are dismissed. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Lee Dong-won (Presiding Justice)