Cho High Court Decision 2010Du3744 ( October 15, 2011)

Since the secondary tax liability is deemed to be registered as a formal member of a corporation, the secondary tax liability disposition is unlawful.

In light of the fact that the Plaintiff did not make an investment in the law firm, and it appears that the Plaintiff was registered as a member of the law firm in its form as well as that it was merely merely to the employees employed by the law firm and not to participate in the business, and thus, it appears that the Plaintiff was registered as a general partner of the law firm.

Article 39 of the Framework Act on National Taxes

2011Revocation of disposition of imposing value-added tax, etc.

Park AA

Head of Seocho Tax Office

March 20, 2012

April 5, 2012

1. On July 16, 2010, the imposition disposition of value-added tax, wage and salary income tax, and private income tax on the Plaintiff is revoked.

2. The costs of the lawsuit are assessed against the defendant.

The same shall apply to the order.

1. Details of the disposition;

A. On January 13, 2006, a law firm BB (hereinafter “foreign corporation”) was established for the purpose of attorney-at-law, etc., and was dissolved on February 25, 2010 due to the revocation of its establishment authorization.

B. In the event that the non-party corporation failed to pay the value-added tax on the attached list sheet and the property of the non-party corporation is difficult to cover the amount of the tax in arrears, the defendant designated the plaintiff as a member of the non-party corporation as the second taxpayer on July 16, 2010 and notified the plaintiff of the payment of the amount of the tax in addition to the attached list column (hereinafter "the disposition in this case").

C. The Plaintiff appealed and filed an appeal with the Tax Tribunal on November 3, 2010, but the Tax Tribunal dismissed the said appeal on March 15, 201.

[Reasons for Recognition] Evidence No. 10-2, Evidence No. 13-1, Evidence No. 13-9, Evidence No. 1, Evidence No. 2-1, and the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

The plaintiff was registered as a member of the form to establish and maintain the non-party corporation upon the request of the KimCC established the non-party corporation and the former DD lawyer, but it did not actually invested in the non-party corporation or participated in the management of the non-party corporation, and is merely an employee employed by the non-party corporation. Therefore, the plaintiff cannot be actually a member of the non-party corporation, and therefore, the second tax liability under Article 39

B. Relevant statutes

The entries in the attached Table-related statutes are as follows.

C. Facts of recognition

1) The GuD and KimCC decided to establish a law firm in December 2005 and decided to employ the Plaintiff and KimE as their affiliated attorneys.

2) However, in order to establish a law firm, there is a need for more than five members under the Attorney-at-law Act, and at least one of them must be an attorney-at-law with work experience of not less than 10 years, the old DD and KimCC asked the Plaintiff and KimE law firm that they have employed and will become a member attorney-at-law in a formal form for the establishment of their law firm, and they would pay 00 won per month to the highest FF, which is a lawyer with work experience of not less than 10 years, if they become a member attorney-at-law in the form of form. The plaintiffs, KimE and the lowest FF accepted all of them.

3) On January 13, 2006, the old DD and KimCC established a non-party legal entity by investing a cash of KRW 000 in cash, and in the corporate register, the old DD, KimCC, the Plaintiff, KimE, and the last FF were registered as members of the corporate register as having invested KRW 00 each.

4) The Plaintiff worked in a non-party legal entity from January 2006 to April 2009. The Plaintiff only performed the business of performing a litigation with a strong dividend of the case that the formerCC and KimCC received a certain amount of wages every month, and did not participate in the management of the non-party legal entity.

5) While working in a non-party corporation, the Plaintiff received benefits of KRW 000 in 2006, KRW 000 in 2007, and KRW 000 in 2008. The Plaintiff did not receive benefits in 2009.

6) The corporate register of the non-party corporation is written on April 15, 2009 by the Plaintiff as a member of the non-party corporation.

7) On March 3, 2011, the Plaintiff filed an accusation against the representative of the non-party legal entity with the Seoul Regional Employment and Labor Office on the ground that the non-party legal entity did not pay approximately KRW 000,000 as retirement allowances, and the Seoul Regional Employment and Labor Office sent it to the Public Prosecutor’s Office on June 24, 201 with the opinion of prosecution on the Gu Do Do Do Do

[Based on recognition] 1, 3, 4, 10, 15, and 17 evidence Nos. 1, 3, 4, 10, 15, and 17 (including the number), 1, and the witness KimCC's testimony and the purport of the whole pleadings

D. Determination

Article 58(1) of the Attorney-at-Law Act provides that the provisions of the Commercial Act concerning unlimited liability companies shall apply mutatis mutandis to law firms except as otherwise provided for in this Act. Article 11212(1) of the Commercial Act provides that each partner shall be jointly and severally liable for payment when it is impossible to fully pay the company's obligations with the assets of an unlimited liability company. Meanwhile, Article 39(1)1 of the Framework Act on National Taxes requires that the unlimited liability partner of the corporation be able to participate in the operation of the corporation as of the date on which the liability to pay delinquent national taxes is established, and the mere fact that the company is registered as a general partner of the corporation in its form as a general partner in its registry cannot be imposed (see Supreme Court Decision 90Nu4235, Sept. 28, 190). In light of the above provisions and legal principles, it is reasonable to view that the non-party company was in a position that the Plaintiff actually engaged in the management of the non-party company as a member of the unlimited liability company, i.e., and the Plaintiff did not participate in cash.

3. Conclusion

The plaintiff's claim is justified and accepted.