[1] Whether a provision regarding the use of support payments for social welfare foundation or social welfare facility for any purpose other than its original purpose should be strictly interpreted (affirmative)

[2] Where the head of the competent Gun issued an order to return the relevant amount to the corporation Gap in the corporate account in accordance with Article 40(1)4 of the Social Welfare Services Act on the ground that the social welfare foundation Gap established and operated living facilities for the disabled used the corporate support fund by expanding the area of one sanatorium and low temperature warehouse, and the act of Gap constitutes "use of support fund for any purpose other than the original purpose", the case holding that the court below erred by misapprehending the legal principles which interpreted the non-designated support fund under the guidelines of the Ministry of Health and Welfare as falling under the "facility cost" in which non-designated support fund can be used in consultation with the Ministry of Health and Welfare, although there is room to interpret the construction or extension of a building as falling under the "facility cost" of non-designated support fund.

[1] According to Article 40(1)4 of the Social Welfare Services Act, influences such as an improvement order may be imposed on the use of donations for any purpose other than the original purpose. According to Article 54 Subparag. 5 of the same Act, if a person who received such an improvement order fails to comply with it, the person is subject to criminal punishment. Thus, the provisions regarding the use of donations for any purpose other than the original purpose should be strictly interpreted, and shall not

[2] In a case where the head of the competent Gun issued an order to return the amount corresponding to Gap corporation’s corporate accounting in accordance with Article 40(1)4 of the Social Welfare Services Act, on the ground that the act of Gap corporation constitutes “use of support payments for purposes other than the original purpose,” the case holding that the court below erred in the misapprehension of the concept of “cost for acquiring assets and buildings” under Article 40(1)2 of the Financial Accounting Rules, which is the Ministry of Health and Welfare’s guidelines, for the purpose of prohibiting the use of non-designated support payments in the “Management Guidance for Social Welfare Corporation” in 2013, including the cost for acquiring assets and buildings by means of construction, expansion, or reconstruction of buildings and the cost for newly constructed, expanded, or reconstructed buildings and the cost for using non-designated support payments to Gap corporation constitutes “cost for acquiring assets” and the cost for newly constructed, expanded, or reconstructed facilities including the cost for acquiring new, non-designated support payments” under the said guidelines, and thus, it constitutes an unlawful construction of the concept of “expenses facility cost” under Article 40(2) of the Financial Accounting Rules.

[1] Articles 40(1)4 and 54 subparag. 5 of the Social Welfare Services Act / [2] Articles 40(1)4 and 54 subparag. 5 of the Social Welfare Services Act, Article 10(3) [Attachment 2] and Article 41-7(2) of the Financial Accounting Rules for Social Welfare Foundation and Social Welfare Facilities

Social welfare foundation (Law Firm aiming at Law, Attorney Jeong-soo et al., Counsel for the plaintiff-appellant)

Gyeonggi-do Yang-gun (Law Firm Corporation, Attorneys Seo Young-young et al., Counsel for the defendant-appellant)

Seoul High Court Decision 2016Nu56037 decided December 22, 2016

Of the part against the Plaintiff, the part of the lower judgment’s claim for revocation of the order for improvement is reversed, and that part of the case is remanded to the Seoul High Court. The remainder of the appeal is dismissed.

The grounds of appeal are examined.

1. As to the ground of appeal No. 2014-4 of the lower judgment’s holding that the disposition is unlawful

1) According to Article 45(2) of the Social Welfare Services Act, the issuance of receipts for support payments, reports on the receipt and use of support payments, and other detailed matters, such as procedures for managing and disclosing support payments, are prescribed by Ordinance of the Ministry of Health and Welfare. According to Article 41-7(2) of the Financial and Accounting Rules of Social Welfare Foundation and Social Welfare Facilities (hereinafter “Financial Accounting Rules”), the Minister of Health and Welfare may set the guidelines for the use of support payments for which the sponsor has not designated the purpose of use.

On the other hand, the Ministry of Health and Welfare’s 6th of the 2013 Guidelines for Management of Support Payments prescribed the “standards for the use of non-designated support payments” as the “standards for the use of non-designated support payments”. In full view of the contents thereof, non-designated support payments can be used as “facilities and equipment maintenance expenses,” which are direct expenses, among the “facilities expenses” in the broad area, and “facilities expenses,” among the indirect expenses, can be used as “facilities expenses,” but the ratio of use does not exceed 50%, and cannot be used as “property acquisition expenses,” among the indirect

2) Based on evidence, the lower court acknowledged the fact that the Plaintiff used KRW 79,930,00 for corporate support payments while expanding the size of a beneficial house and a low temperature warehouse around May 2013, and determined that the Defendant issued an improvement order ordering the Plaintiff to return the said amount to the corporate account in accordance with Article 40(1)4 of the Social Welfare Services Act, on the ground that the Plaintiff’s act constitutes “use of support payments for purposes other than the original purpose.”

3) However, the above determination by the court below is difficult to accept for the following reasons.

Administrative laws and regulations, which serve as the basis for sediment administrative acts, must be strictly interpreted and applied, and shall not be excessively expanded or analogically interpreted in the direction unfavorable to the other party to such administrative act. Even if a teleological interpretation that takes into account the legislative intent, purpose, etc. is not entirely excluded, such interpretation shall not go beyond the ordinary meaning of the text and text (see, e.g., Supreme Court Decision 2011Du3388, Dec. 12, 2013).

According to Article 40(1)4 of the Social Welfare Services Act, influences such as an improvement order may be imposed on the use of donations for any purpose other than the original purpose. According to Article 54 Subparag. 5 of the same Act, if a person who received such an improvement order fails to comply with such order, criminal punishment may be imposed. Thus, the provisions on the use of donations for any purpose other than the original purpose should be strictly interpreted, and the interpretation shall

Therefore, in light of the language and text of the “property acquisition cost” under the “property acquisition cost for land and buildings,” which is stipulated for the purpose of non-designated support payments prohibited from being used, the price, etc. when acquiring a building by means of the purchase, etc. of an existing building may be included therein. However, in the case of new construction, expansion or reconstruction of a building, it is unclear whether the cost constitutes “property acquisition cost” or not.

In addition, the term "standards for the use of non-designated support payments" in the above guidelines is determined by the Minister of Health and Welfare pursuant to the delegation of Article 41-7 (2) of the Financial Accounting Rules, so the definition of "facilities costs" or the classification of detailed items in the above guidelines shall comply with the Financial Accounting Rules.

However, according to Article 10(3) [Attachment 2] of the Financial Accounting Rules, “mining facility cost” is divided into “facility cost”, “property acquisition cost”, and “facility maintenance cost” in consultation, and “facility cost” includes “facility cost” in consultation.

Therefore, unlike the case of acquiring a new building, there may be room to interpret that the cost of the new building or the extension or reconstruction of a new building corresponds to the “facility cost” of consultation.

Nevertheless, the court below interpreted the "asset acquisition cost" of the above guidelines, the meaning of which is unclear, to the plaintiff as the concept including the cost of new construction and extension of a building. The court below erred by misapprehending the legal principles on the interpretation and application of administrative laws and regulations, which serve as the basis for indive administrative acts, thereby affecting the conclusion of the judgment. The ground of appeal pointing this out

2. As to the remaining grounds of appeal

After finding facts as stated in its reasoning based on evidence, the lower court determined that each of the above dispositions was lawful, on the ground that each of the dispositions in its holding is recognized as follows: (i) 1, (2), (9), (1) 1; (ii) 2014-5; (iii) 2014-6; and (iv) 2014-6, which are the grounds for each disposition.

In light of the relevant legal principles and records, the lower court did not err by exceeding the bounds of the principle of logic and experience and by exceeding the bounds of the free evaluation of evidence, or by misapprehending the legal doctrine on accounting fraud, or by misapprehending the legal doctrine on proportionality, contrary to what is alleged in the

3. Conclusion

Therefore, among the part against the plaintiff in the judgment below, the part of the claim for revocation of disposition No. 2014-4 of the judgment below is reversed, and that part of the case is remanded to the court below for a new trial and determination, and the remaining appeal is dismissed. It is so decided as per Disposition by the assent of all participating Justices.

Justices Lee Ki-taik (Presiding Justice)