[1] Requirements for deducting the guaranteed debt from the value of the inherited property

[2] In determining whether it is a joint and several liability of the inheritee for a third party, which shall be deducted from the value of the inherited property, the standard of determining whether the principal debtor is unable to repay and the burden of proof

[1] Article 4(1)3 and Article 10(2) of the former Inheritance Tax Act (amended by Act No. 4283 of Dec. 31, 190) refer to an obligation of an inheritee to be deducted from the value of inherited property under Article 4(1)3 and Article 10(2) of the same Act, which is deemed to be certain at the time of the commencement of the inheritance to be fully borne by the inheritee at the time of the commencement of the inheritance. Thus, in cases where an inheritee bears a joint and several liability for a third party or is liable for a surety as a surety, the obligor shall not perform his/her obligation because the obligor is insolvent at the time of the commencement of the inheritance, and if it is deemed that there is no possibility that the obligor may receive reimbursement even if he/she exercises his/her

[2] [1] In the case of the commencement of inheritance, whether the principal debtor is not in an impossible condition at the time of the commencement of inheritance, generally, the principal debtor is subject to commencement of bankruptcy, composition, corporate reorganization, compulsory execution procedure, etc., or his/her business closure, missing, or execution of punishment has continued for a considerable period of time, so it is not possible to get a loan differently, and it is not objectively acceptable to recover the claim due to the circumstances such as where the principal debtor is unable to recover the claim due to the bankruptcy, composition, corporate reorganization, or compulsory execution, etc., and it is reasonable to assume that the burden of proof exists on the taxpayer who disputes the value of inheritance tax, on the other hand, since such reasons are special reasons that affect exceptionally in determining the value of inheritance tax

[1] Articles 4(1)3 and 10(2) of the former Inheritance Tax Act (amended by Act No. 4283, Dec. 31, 1990) / [2] Articles 4(1)3 and 10(2) of the former Inheritance Tax Act (amended by Act No. 4283, Dec. 31, 1990)

[1] [2] Supreme Court Decision 83Nu410 decided Dec. 13, 1983 (Gong1984, 206) Supreme Court Decision 88Nu4294 decided Jun. 27, 1989 (Gong1989, 1175) / [1] Supreme Court Decision 85Nu760 decided Mar. 11, 1986 (Gong1986, 650) decided May 12, 1987 (Gong1987, 103) 91Nu1455 decided May 24, 191 (Gong191, 1798)

Plaintiff 1 and one other (Attorney Park Jong-young, Counsel for the plaintiff-appellant)

The Director of the Pacific District Office

Seoul High Court Decision 93Gu1182 delivered on June 28, 1995

The part of the lower judgment against the Defendant is reversed. This part of the case is remanded to the Seoul High Court. The Plaintiff’s appeal is dismissed.

The grounds of appeal are examined.

1. As to the ground of appeal No. 1 by the plaintiffs

Examining the reasoning of the judgment below in light of the records, the court below is justified in rejecting the plaintiffs' assertion that since the deceased non-party 1, the deceased non-party 1, from around July 30, 1985, borrowed a total of KRW 320,000,000 from the Seoul Trust Bank, and used it for his own purpose, the above loan obligation should be deducted from the value of inherited property, and it cannot be said that there was any error of misconception of facts against the rules of evidence. The plaintiffs' grounds for appeal pointing this out cannot be accepted.

2. Regarding the plaintiffs' ground of appeal No. 2 and the defendant's ground of appeal

According to the reasoning of the judgment of the court below, the non-party 1 and the non-party 2 were established at around 1985, and the non-party 1 were the representative director from April 18, 1985 to December 31, 1987. From around July 30, 1985, the non-party company received a loan of KRW 320,00,000 from the above Seoul Trust Bank for about 22 times until January 12, 1987, the above non-party 1 and the above deceased non-party 1 were jointly and severally liable for the above debt amount of KRW 00,00,00,000, and the non-party 2 and the above deceased non-party 1 were not jointly and severally liable for the above debt amount of KRW 00,00,000,000,000,000,000,000,000 won were actually and severally liable for the above debt amount of KRW 10,0.

However, since an ancestor's obligation to be deducted from the value of inherited property pursuant to Articles 4 (1) 3 and 10 (2) of the former Inheritance Tax Act (amended by Act No. 4283, Dec. 31, 1990; hereinafter "the Act") refers to an obligation that is deemed certain at the time of commencement of the inheritance, the ancestor's obligation is to be ultimately borne by the ancestor at the time of commencement of the inheritance. Thus, in cases where an ancestor bears joint and several liability or is liable as a surety for a third party at the time of commencement of the inheritance tax, the ancestor's obligation should not be repaid because the principal obligor is insolvent, and even if the principal obligor exercises his right to indemnity against the principal obligor, it is deemed that the amount of such obligation can be deducted from the value of inherited property (see Supreme Court Decisions 87Nu20, May 12, 1987; 88Nu4819, Jun. 27, 1989; 204Nu5194, May 195, 197, etc.

However, according to the records, it can be seen that the non-party company did not have any situation such as business closure at the time of the commencement of the inheritance of this case, or there was no application for compulsory execution or corporate reorganization, and only discontinued its business after about three years have passed since the death of the decedent. Thus, the non-party company did not err by misapprehending the legal principles on the scope of joint and several liability, or failing to exhaust all necessary deliberations on the scope of joint and several liability without any further grounds for appeal, as the non-party company's debt should be deducted from the value of inherited property. Thus, the part of the grounds of appeal by the defendant's ground of appeal which pointed out in this ground of appeal should not be accepted, and it cannot be viewed that the non-party company as the principal debtor at the time of the commencement of the inheritance of this case has no possibility of being repaid even if it exercised its right to indemnity against the principal debtor.

3. As to the third ground for appeal by the plaintiffs

In the case of joint inheritance, an objection against the disposition of imposition of inheritance tax shall be based on the principle that each inheritor files a lawsuit against the amount of tax liable for him/her. However, in the pre-trial procedure, such as a request for examination and a request for trial, it is reasonable to view that if a person who is entitled to receive a notification of the tax base and amount of inheritance tax on behalf of the co-inheritors receives such notification and goes through the pre-trial procedure, the remaining inheritors need not go through the same pre-trial procedure. This is the same as in the case where the tax authority notifies not only the person who is entitled to receive the notification on behalf of the inheritor but also all his/her successors. However, a lawsuit seeking the revocation of the disposition of imposition of inheritance tax must bring a lawsuit against each inheritor, and thus, the illegality of the disposition of imposition against the non-party 2 who did not bring a lawsuit in this case cannot be the object of the lawsuit in this case

4. Therefore, the part of the lower judgment against the Defendant is reversed, and that part of the case is remanded to the lower court for further proceedings consistent with this Opinion. The Plaintiff’s appeal is dismissed, and it is so decided as per Disposition by the assent of all participating Justices.

Justices Park Jong-chul (Presiding Justice)