2017Du69038 Revocation of Disposition of Revocation of Undue Benefits

A Social Welfare Foundation

Budget Head of budget

Daejeon High Court Decision 2017Nu12108 Decided October 25, 2017

March 27, 2018

The judgment of the court below is reversed, and the case is remanded to Daejeon High Court.

The grounds of appeal are examined.

1. Article 2 Subparag. 1 (h) of the former Social Welfare Services Act (amended by Act No. 13996, Feb. 3, 2016; hereinafter the same) provides that one of the “social welfare services” refers to various kinds of welfare services, such as services related to rehabilitation of mentally ill persons under the Mental Health Act, and services related thereto, and other services for the operation or support of welfare facilities. Meanwhile, Article 42 of the same Act provides that “the State or a local government may subsidize all or part of the necessary expenses to a person prescribed by Presidential Decree from among those who conduct social welfare services, and may not use the subsidy under paragraph (1) for any purpose other than its original purpose,” and Article 2 Subparag. 3 provides that “the State or a local government may order the return of all or part of the subsidy already paid if the person who received the subsidy under paragraph (1) falls under any of the following subparagraphs,” and subparagraph 2 of the same Article provides that “when it has used the subsidy for any purpose other than its original purpose:

2. The lower court acknowledged that the Plaintiff registered E and F (hereinafter “E, etc.”) employees E and F (hereinafter “E, etc.”) affiliated with the mental health sanatorium, which was already operated for the operation of D, as the rehabilitation center for mentally ill persons, with the competent administrative agency, and determined that the Plaintiff’s act of using E, etc. as a subsidy received as operating expenses of the mental health care center after the above employee registration constitutes “the case where the Plaintiff used the subsidy for purposes other than the business purpose” under Article 42(3)2 of the former Social Welfare Services Act and becomes subject to restitution.

3. However, the lower court’s determination is difficult to accept.

A. First, according to the evidence duly admitted by the lower court, the following circumstances are revealed.

(1) Even after the Plaintiff’s registration of E, etc. as an employee affiliated with D, the circumstances in which the Plaintiff actually performed his/her duties cannot be seen.

(2) Even after the above employee registration, the Plaintiff still reported E, etc. to the competent administrative agency as an employee belonging to the Medical Care Center, and reported his/her retirement after March 18, 2013.

(3) It does not seem that there was a temporary suspension of the work of E, etc. before and after the above employee registration, or there was a change in the content of the work.

(4) At the time of the audit conducted by the Office for Government Policy Coordination, G et al. prepared a written confirmation that “the Plaintiff paid KRW 56,818,940,00 to the Plaintiff, a total of the personnel expenses of E et al., D employees, as the expenses for the operation of the B mental source.” However, it cannot be deemed that the said written confirmation was the legal evaluation of the unfair use of subsidies.

B. In light of the aforementioned circumstances, it is difficult to readily conclude that the Plaintiff’s act of dual registration or false registration is a use of the subsidy received as the operating expense for mental health care center for the purpose other than the business purpose solely on the ground that the Plaintiff paid E, etc. with the subsidy received as the operating expense for the B/L, etc. for the purpose of its business purpose.

4. Therefore, the lower court should have further examined whether the Plaintiff’s registration of E, etc. as a staff member of D, whether there was a substantial change in the work of E, etc. before and after the said employee registration, and whether E, etc. performed some of the work in D, and then examined whether it can be deemed that E, etc. were retired from the Hyhic Health Center at the time of the said employee registration. Accordingly, it should have determined the existence of the reason for the instant disposition and whether there was deviation or abuse of the discretionary power

Nevertheless, without examining these circumstances, the lower court concluded that the payment of labor cost, E, etc. with the subsidy received as the operating cost of the Bathic Health Care Center was a use of the subsidy for purposes other than business purposes. In so doing, the lower court erred by failing to exhaust all necessary deliberations, which affected the conclusion of the judgment.

5. Therefore, the lower judgment is reversed, and the case is remanded to the lower court for further proceedings consistent with this Opinion. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Cho Jong-hee

Justices Kim Jae-tae

Justices Kim Jae-in

Justices Min Il-young in charge