[1] Whether a person who receives a “indirect subsidy” under Article 2 subparag. 4 of the Act on the Budgeting and Management of Subsidies is the subject of a violation of Articles 40 and 41 of the same Act (affirmative)

[2] In a case where Jeju Special Self-Governing Province received subsidies from the State and granted indirect subsidies to the Defendant for the national unification festival and international alliance project, the case affirming the judgment below that the Defendant becomes the principal agent of a violation of Articles 40 and 41 of the Act on the Budgeting and Management of Subsidies in relation to the above indirect subsidies

[3] The meaning of "false application or other unlawful means" under Article 40 of the Act on the Budgeting and Management of Subsidies

[1] Article 2 subparag. 4, Article 40, and Article 41 of the Act on the Budgeting and Management of Subsidies / [2] Article 2 subparag. 4, Article 40, and Article 41 of the Act on the Budgeting and Management of Subsidies, Article 22 of the former Act on the Budgeting and Management of Subsidies (amended by Act No. 9347 of Jan. 30, 200) / [3] Article 40 of the Act on the Budgeting and Management of Subsidies

[3] Supreme Court Decision 99Do4101 Decided January 5, 2001 (Gong2001Sang, 469) Supreme Court Decision 2007Do8651 Decided February 1, 2008, Supreme Court Decision 2009Do8769 Decided March 25, 2010

Defendant

Defendant

Law Firm Oyn Law Firm, Attorneys Kim Tae-won et al.

Jeju District Court Decision 2010No346 decided October 7, 2010

The appeal is dismissed.

We examine the grounds of appeal.

1. As to the grounds of appeal Nos. 1 and 3

Article 2 Subparag. 1 of the Act on the Budgeting and Management of Subsidies (hereinafter “Subsidy Act”) provides that “The term “subsidies” means subsidies, charges, and other benefits prescribed by the Presidential Decree that are granted without receiving any corresponding consideration from the State for any affairs or projects conducted by any person other than the State, with the aim of creating them or providing financial assistance.” Article 40 provides that “Indirect subsidies refer to benefits that are granted by any person other than the State without receiving any corresponding consideration from all or part of the financial resources of the subsidies.” Article 41 provides that “The term “indirectly subsidies” refers to benefits that are granted by any person other than the State without receiving any corresponding consideration for the purpose of granting such subsidies.” Article 40 provides that “The person who has received subsidies or indirect subsidies by false application or other unlawful means, and uses them for other purposes in violation of Article 22, that is, indirect subsidies.” Article 40 and Article 41 provides that a person who has received any benefits without receiving any corresponding consideration for the purpose of granting the subsidies shall be the subject of the crime of violating the Subsidy Act.

According to the reasoning of the lower judgment and the record, the Defendant’s subsidies that the Jeju Special Self-Governing Province received from the State through the Jeju Special Self-Governing Province during the period from 2006 to 2008, as stated in the facts charged, can be seen as constituting an indirect subsidy on the grounds that the Jeju Special Self-Governing Province received subsidies from the State for the projects for search, national festivals, and Jeju International Joint Venture Project without receiving any corresponding consideration from the State and granted such subsidies to the Defendant according to the purpose of granting the subsidies. Therefore, the Defendant is the subject of

The judgment of the court below to the same purport is just, and there is no error in the misapprehension of legal principles or incomplete deliberation as to the violation of Articles 40 and 41 of the Subsidy Act, as alleged in the grounds

2. Regarding ground of appeal No. 2

The deception as a requirement for fraud refers to all affirmative and passive acts that have to observe each other in the context of property transaction. It is sufficient if it does not necessarily require false marking on the important part of a juristic act, and it is true that it constitutes the basis of judgment for an actor to take a disposition of property which he wishes to take by mistake (see, e.g., Supreme Court Decisions 83Do1013, Jun. 28, 1983; 2005Do5774, Oct. 28, 2005; 2005Do5774, Oct. 28, 2005). Meanwhile, Article 40 of the Subsidy Act refers to active and passive acts that can affect the decision-making on the grant of subsidies by deceptive scheme or other acts that are deemed unfair by social norms although they cannot receive subsidies under the Act in accordance with normal procedures (see, e.g., Supreme Court Decisions 9Do4108, Jan. 5, 201; 2008Do6168, Aug. 207

In light of the above legal principles and records, the court below is just in finding the defendant guilty of all the charges of fraud of this case and violation of Article 40 of the Subsidy Act, and there is no error of law such as misunderstanding of legal principles as to the violation of Article 40 of the Subsidy Act or incomplete deliberation, as argued in the Grounds for Appeal

3. Conclusion

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

Justices Min Il-young (Presiding Justice)