In case where illegal political funds are contributed through a gratuitous loan of money or valuables, the meaning of property gains subject to the necessary confiscation or collection under Article 45(3) of the Political Funds Act (=the amount equivalent to the financial gains)

The necessary confiscation or collection pursuant to the provisions of Article 45 (3) of the Political Funds Act is aimed at depriving a person who violates Article 45 (1) and (2) of the same Act of money and valuables provided and other property gains provided and preventing such person from holding unjust profits. In the event that illegal political funds are donated through free lending of money and valuables, the illegal profits received by the criminal shall be the amount equivalent to the financial gains on the loan free of charge. Thus, the subject of confiscation or collection is not the money and valuables given free of charge but the amount equivalent to the above financial gains.

Article 45(3) of the Political Funds Act

Supreme Court Decision 2004Do482 Delivered on April 27, 2004 (Gong2004Sang, 946) Supreme Court Decision 2004Do5652 Delivered on December 10, 2004 (Gong2005Sang, 157)

Defendant 1 and three others

Defendant 1 and two others and the Prosecutor

Law Firm International et al.

Busan High Court Decision 2006No445 decided Oct. 11, 2006

All appeals are dismissed.

1. As to the Prosecutor’s Grounds of Appeal

The necessary confiscation or collection pursuant to the provisions of Article 45 (3) of the Political Funds Act is aimed at depriving a person who violates Article 45 (1) and (2) of the same Act of money and valuables provided and other property gains provided and preventing such person from holding unjust profits (see Supreme Court Decision 2004Do482, Apr. 27, 2004; Supreme Court Decision 2004Do5652, Dec. 10, 2004; etc.). In a case where illegal political funds are contributed through free lending of money and valuables, the illegal profits received by the criminal shall be deemed as the amount equivalent to the financial gains from the free lending. Thus, the confiscation or collection is not the money and valuables provided without compensation but the amount equivalent to the above financial gains.

Upon examining the records in light of the above legal principles, the court below is just in maintaining the judgment of the first instance that collected the amount of KRW 468,493 equivalent to the financial profit accrued from the loan of KRW 20,000,000, not the money and valuables 20,000,000 which Defendant 4 received a free loan from an illegal political fund, and there is no violation of law such as misunderstanding the legal principles as to confiscation or collection under Article 45(3) of the Political Funds Act as alleged in the ground of appeal.

2. As to the grounds of appeal by Defendant 1, 2, and 3

According to the records, it is evident that only the prosecutor appealed the judgment of the court of first instance on the grounds of unfair sentencing, and Defendant 1, 2, and 3 did not appeal all of them. In such a case, the above Defendants cannot be viewed as the grounds for appeal against the judgment of the court below for reasons such as incomplete deliberation, violation of the rules of evidence, mistake of facts, or misapprehension of legal principles as alleged (see, e.g., Supreme Court Decisions 91Do1796, Dec. 24, 1991; 96Do1212, Oct. 11, 1996).

Furthermore, according to the Political Funds Act, the term "political fund" means a political party (including a Preparatory Committee for Central Party Formation), a person who intends to be elected by a public official election, a candidate for public office, or a salaried clerical staff member of a supporters' association, an executive member of a political party, or any other person who is engaged in political activities, and expenses for their political activities (Article 3 subparagraph 1 of the Political Funds Act). In punishing those who are contributed political fund in a manner not provided for in the Political Funds Act, the political fund is punished as its members if they are provided to a political party, supporters' association, a corporation, or any other organization (Article 45 (1) of the Political Funds Act). Meanwhile, Article 113 (1) of the Public Official Election Act prohibits those who are provided with money and goods for the same purpose as that of a political party, support fund, subsidy, and other incidental revenue as provided for in the party constitution and regulations, and thus, constitute a kind of act of violation of the Constitution of 10, 2000 electors or one person who is likely to have a certain relationship with the election commission.

In addition, the purpose of the Public Official Election Act is to contribute to the development of democratic politics by ensuring that an election is held fairly in accordance with the free will of the people and democratic procedures (Article 1); the restriction on contribution acts in Article 113 of the Public Official Election Act is likely to contribute to the formation of a candidate's foundation or to purchase, and if such permission is granted, it is intended to prevent an election from being carried out in the process of provokinging the candidate's personal resources, opinions, and policies rather than to be an opportunity for evaluation (see Supreme Court Decision 98Do477 delivered on July 10, 198, Supreme Court en banc Decision 2001Do2819 delivered on Feb. 21, 2002). It is highly probable that such act is an act in accordance with Article 112 (1) of the Public Official Election Act, which is an act in accordance with the legislative rules and regulations of the National Election Commission, and thus, it is an act in the form of ordinary social order that does not exist.

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

Justices Park Si-hwan (Presiding Justice)