[1] Whether a defect in a beneficial administrative disposition should consider the trust interest of the party in a case where the defect occurred due to the party's concealment or other fraudulent act (negative)

[2] The case holding that an administrative disposition ordering the recovery and disposal of the relevant drug on the ground that part of biological equivalence test data was partially fabricated, cannot be deemed unlawful since it deviates from or abused discretion

[1] If there is a defect in an administrative act, a disposition agency which has conducted an administrative act may cancel it by itself, even without a separate legal basis. However, when cancelling a disposition of beneficial nature, it may cancel it only where it is strong enough to justify the disadvantage that the public interest needs to sustain due to the necessity of the public interest, protection of trust and infringement of the stability of legal life, etc. Where it is necessary to cancel it, the disposition agency which has conducted an administrative act may cancel it by comparing and comparing the necessity of the public interest to be cancelled, the right to obtain benefits to be suffered by the parties due to such cancellation, and the infringement of the stability of legal life. However, if the defect of the administrative disposition of beneficial nature is attributable to the party's act of application by means of abolition or other fraudulent methods, the party is also aware of the fact that the party has illegally acquired the benefits from the disposition, and even if the administrative agency did not consider it, it shall not be deemed as abuse of discretion, and in this case, the fact

[2] In a case where an order to recover and discard the relevant drug on the grounds that part of biological equivalence test data was partially fabricated, the case holding that the above disposition cannot be deemed unlawful because it abused or abused discretion, in light of the fact that the disadvantage of the pharmaceutical company's economic loss and the biological equivalence are not verified in advance due to the pertinent administrative disposition, and that it is difficult to simply compare the needs of public interest to prevent risks that may infringe public health due to the distribution of medicines, etc.

[1] Article 4 (2) of the Administrative Procedures Act / [2] Article 27 of the Administrative Litigation Act, Article 65 of the former Pharmaceutical Affairs Act (amended by Act No. 8365 of Apr. 11, 2007) (see current Article 71)

[1] Supreme Court Decision 95Nu4926 delivered on July 28, 1995 (Gong1995Ha, 3007) Supreme Court Decision 2003Du4669 Delivered on May 25, 2006 (Gong2006Ha, 1162)

Plaintiff (Attorney Park Jong-il, Counsel for the plaintiff-appellant)

The Commissioner of the Korea Food and Drug Administration (Law Firm Roz, Attorneys Jeon-soo et al., Counsel for the plaintiff-appellant

Seoul High Court Decision 2007Nu28108 decided May 6, 2008

The judgment below is reversed and the case is remanded to Seoul High Court.

We examine the grounds of appeal.

Recognizing the reasoning of the first instance judgment, the lower court determined that the Defendant’s disposition of this case was abuse of discretion on the ground that, in light of the following circumstances: (a) the number of crotograms operated among the contents of the instant report based on the evidence of employment as indicated in the judgment, is only about 1% of the entire report; and (b) even based on the original data of the crotogram, it is determined that the degree of operation is insignificant; and (c) the content of the data which are inconsistent with the materials is not by itself a defect of pharmaceutical products, rather than by the defect of pharmaceutical products; and (d) the degree of the defect of the materials submitted and the process of requesting and submitting materials for the same-sex test of this case, it appears that the Plaintiff’s causes for the operation of the materials are considerably small in light of the public interest to be achieved by the instant disposition, and thus, it is more reasonable to deem that the damage and trust of private interest suffered by the Plaintiff in light of the degree of public interest to be achieved by the instant disposition.

However, if there is a defect in an administrative disposition, a disposition agency which has conducted an administrative act may cancel it by itself, even without any separate legal basis. However, when cancelling a disposition, it may cancel it only when comparing and comparing the necessity of the public interest to cancel it with the disadvantage of the parties, such as the infringement of the right to obtain benefits and the protection of trust, and the stability of legal life, etc., which would be suffered by the parties due to the cancellation, and only when it is strong enough to justify the disadvantage that the public interest needs to sustain. However, if the defect of the beneficial administrative disposition is due to the party's fact or other fraudulent act, if it is caused by the party's filing of an application by deceit or other fraudulent method, the party can have known that the benefit from the disposition was illegally acquired, and even if the administrative agency did not consider it, it shall not be deemed to have abused its discretionary power. In this case, the party's fact was not considered to have been passive through a third party (see, e.g., Supreme Court Decisions 95Nu4926, Jul. 28, 1995).

Examining the facts duly admitted by the court below in light of the above legal principles, the plaintiff submitted test data operated by rapF Co., Ltd. with respect to the drug of this case, and the defendant deemed the above test data to be genuine and granted permission to manufacture the drug of this case. Thus, even if the defendant did not consider the plaintiff's trust interest in the above manufacturing permission in disposing of the drug of this case, it cannot be said that there was any illegality in the disposition of this case.

In addition, since drugs have a direct impact on human life and health, more strict and strict standards are required in dispositions to ensure improvement in national health by ensuring the safety and effectiveness of drugs. However, even if there is only a partial operation of test data, and according to the original data before operation, the operation of test data per se constitutes an inethic fraud, which is highly likely to be subject to criticism, and as a result, it would be neglected to distribute medicines that are not verified or guaranteed in advance, and even if there is considerable disadvantage that the Plaintiff may suffer from the instant dispositions, such disadvantage is merely an economic loss, and it is difficult to simply compare the necessity of public interest to prevent risks that may be infringed on national health due to distribution of medicines for which biological equivalence has not been verified in advance, in light of the fact that there is no deviation or abuse of discretionary power in the instant dispositions.

Nevertheless, the court below's determination that the disposition of this case was a deviation or abuse of discretionary power on the ground of the above circumstances is ultimately erroneous in the misapprehension of legal principles as to the discretionary power of the disposition agency when the disposition of this case is revoked on the ground of defects in the administrative disposition, and such illegality has affected the conclusion of the judgment.

The ground of appeal pointing this out is with merit.

Therefore, the judgment of the court below is reversed, and the case is remanded to the court below for a new trial and determination. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Cha Han-sung (Presiding Justice)