Cho High Court Decision 201Do0741 ( November 02, 2011)

It is difficult to view land as a title trust and it is reasonable to view that land was acquired as a gift by purchasing funds.

In light of the fact that the land was acquired by the husband with the 1/2 shares and the 1/2 shares are written as the buyer respectively in the sales contract, and there is no evidence to view that the 1/2 shares were registered in the name of denial and that the 1/2 shares were to be returned to the her husband in the future, it is difficult to view that the 1/2 shares of the land was trusted in trust,

2012Revocation of revocation of disposition imposing gift tax;

XX Kim

The Director of Gangnam District Office

August 28, 2012

September 20, 2012

1. The plaintiff's claim is dismissed.

2. The costs of lawsuit shall be borne by the Plaintiff.

The Defendant’s disposition imposing gift tax of KRW 000 on the Plaintiff on November 12, 2010 shall be revoked.

1. Details of the disposition;

A. The registration of ownership transfer was completed on July 4, 2005 in the name of the Plaintiff and the Plaintiff’s husband on May 19, 2005 with respect to 1/2 shares of 00-20 large 503.5 square meters (hereinafter “instant land”).

B. On June 4, 2007, when the Plaintiff acquired shares in 1/2 of the instant land, the Defendant decided and notified KRW 000 of the acquisition value of KRW 1/2 of the instant land and KRW 000 of the gift tax to the Plaintiff on the ground that the Plaintiff received each donation from EA (the birth of the Plaintiff), and KRW 000 of the gift tax was determined and notified on June 4, 2007. During the administrative litigation (Seoul Administrative Court 2009Guhap7905) filed by the Plaintiff, the donor voluntarily revoked the said disposition on the ground that the donor is not EA and EB but the Plaintiff’s husband’s husband, and on November 12, 2010, the donor as thisCC decided and notified the Plaintiff of KRW 00 of gift tax (hereinafter “instant disposition”).

C. The Plaintiff appealed and filed an appeal with the Tax Tribunal on February 7, 201, but the Tax Tribunal dismissed the appeal on November 2, 201.

[Based on recognition] Gap evidence Nos. 1, 2, and 3 (including branch numbers; hereinafter the same shall apply), Eul evidence Nos. 2, 5, and 6, and the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

The instant land and its neighboring land (Seoul Gangnam-dong 000-15 and 000-19, hereinafter referred to as "the adjoining land of this case") are to be purchased, and to newly build a private house, and thisCC purchased the instant land and the adjoining land of this case respectively.

The purchase funds of each of the above lands were raised by thisCC and thisA through their own securities and deposits (including borrowed accounts) and bank loans, and directly paid registration-related expenses and interest on loans. After purchasing each of the above lands, each of the above lands was provided as collateral to the financial institutions each time the funds were needed. However, thisCC completed the registration of transfer of ownership with respect to the 1/2 shares out of the instant land as the spouse, only under its name, due to the relationship in which it was not able to conduct financial transactions due to bad credit standing. Accordingly, although the actual owner of the instant land was the Plaintiff, the husband, and was merely the title trust to the Plaintiff with respect to the 1/2 shares out of the instant land, the disposition of this case was unlawful on the premise that the Plaintiff received a donation of 1/2 of the acquisition funds of the instant land from thisCC.

B. Relevant statutes

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

C. Facts of recognition

1) Sales contract for the instant land and adjoining land

A) On May 19, 2005, the sales contract (No. 4-1, hereinafter referred to as "the sales contract of this case") dated May 19, 2005 concerning the land of this case entered into the sales contract of this case, MaximumD sold the land of this case to the plaintiff and thisCC in KRW 000, but the contract deposit amount is paid in KRW 000 on the contract basis, and the intermediate payment is paid in KRW 00 on June 20, 2005, and the remainder amount is paid in July 4, 2005, respectively.

B) Each sales contract (Evidence No. 4-2, 3) of May 19, 2005 with respect to the land adjacent to the instant case, each of which is described as the sales contract (Evidence No. 4-2, 2, 3) of the maximum EE Seoul, 000-15, and 000-19 of the maximum F, in each of these 00 won to EA, but the contract deposit is paid at the time of contract, and the intermediate payment is paid at the time of contract, and the intermediate payment is paid at the remainder of 00 won on July 4, 2005, respectively.

2)CC and thisA paid 000 won (on May 19, 2005, deposited KRW 000 as check, and deposited KRW 000 in the name of thisA on May 20, 2005) out of the total purchase price of the instant land and adjacent land. On June 23, 2005, the intermediate payment of KRW 000 was paid as check, and on July 4, 2005, the remainder amount was paid as KRW 00 out of the total sum of KRW 000,000, and the remainder was paid as KRW 00,000,000,000,000. Meanwhile, this and this was appropriated as security of each of the above land.

3) At the time of the purchase of the instant land,CC paid KRW 000 and KRW 000,000, including the registration cost, acquisition tax, etc., and paid interest on the loans to Han Bank Co., Ltd. ($ 000 per month).

4) Since then, thisCC and thisA have been granted loans from time to time by offering the instant land and adjacent land to financial institutions as collateral.

5) On July 13, 2009, thisCC sold to thisA 1/2 shares out of the instant land in KRW 000, and completed the registration of ownership transfer in the name of thisA on October 19, 2009.

6) Meanwhile, the instantCC was in arrears with several recommendations at the time of the enactment of the instant sales contract.

[Reasons for Recognition] Each entry of Gap evidence Nos. 3 through 11, the purport of the whole pleadings

D. Determination

The burden of proof as to the existence of a taxable fact shall be proved by the tax authority, if the other party is presumed to have been taxed in light of the empirical rule, but the other party is not subject to the application of the empirical rule. If, under Article 830(1) of the Civil Act, the real estate acquired in the sole name of one spouse during marriage is presumed to be the unique property of the nominal owner, and if the source of the fund to acquire the real estate has been discovered to be the other spouse, the nominal owner may be deemed to have received a donation of the fund to acquire the real estate from the spouse. In this case, the fact that the real estate concerned cannot be deemed to have received a donation of the fund to acquire it because it is not the special property of the nominal owner

In addition, in order to reverse "the presumption of a specific property" under Article 830 (1) of the Civil Act, the other spouse shall bear the price of the pertinent real estate in fact and shall prove that the other spouse acquired it in order to possess the said real estate in fact. Thus, the mere fact that the other spouse is the source of the purchase fund does not necessarily mean that the presumption of a non-conditional special property was reversed, and a title trust was made with respect to the pertinent real estate. In addition, in full view of all the circumstances revealed through the relevant evidence, whether the other spouse bears the price for the real possession of the pertinent real estate should be determined individually and specifically by taking into account all the circumstances revealed by the relevant evidence (see, e.g., Supreme Court Decision 2006Du806

In light of the above legal principles, 1/2 of the instant land acquired in the name of the Plaintiff is presumed to be the Plaintiff’s unique property, the nominal owner, and 00 won of the acquisition fund of the instant land was appropriated for the securities and deposit account (including borrowed accounts) and bank loans. As such, the Plaintiff may be deemed to have donated KRW 1/2 of the instant land to the Plaintiff’s account (or KRW 000 +00 of the acquisition fund of the instant land). Since the Plaintiff’s deposit cannot be deemed to have received KRW 1/2 of the total acquisition fund of the instant land from the Plaintiff’s account, the Plaintiff’s deposit cannot be deemed to have received KRW 1/2 of the purchase fund of the instant land from the Plaintiff’s account without the Plaintiff’s deposit account being donated to the purchaser of the instant land (or KRW 1/2 of the acquisition fund of the instant land from the Plaintiff’s deposit account). However, since the Plaintiff’s deposit account cannot be deemed to have received KRW 1/2 of the acquisition fund of the instant land from the Plaintiff’s deposit account or the title trust account.

With respect to whether the shares 1/2 of the instant land is the real estate trusted to the Plaintiff, the Plaintiff’s name was lent to the Plaintiff with respect to the shares 1/2 of the instant land under a bad credit standing at the time of the purchase of the instant land, and it was inevitable for the Plaintiff to have conducted financial transactions. The Plaintiff merely purchased the instant land under the Plaintiff’s name. However, the Plaintiff’s actual owner of the instant land asserted that the instant land is thisCC. However, the evidence alone submitted by the Plaintiff is insufficient to recognize that there was a need to purchase the instant land between the Plaintiff’s husband and the Plaintiff to title trust only with respect to the said shares 1/2, or that there was an intention or need to return the instant land to thisCC due to the termination of the title trust after registering the said shares

Rather, the following circumstances acknowledged as seen earlier, namely, ① the Plaintiff’s name is not only indicated in the buyer column under the sales contract of this case, but also indicated in the Plaintiff’s name. ② There is no evidence to deem that the Plaintiff, once registered with respect to 1/2 shares out of the instant land in the name of the Plaintiff, intended to return to thisCC in the future (thisCC sold 1/2 shares out of the instant land under its own name to thisCC on July 13, 2009. If the Plaintiff intended to return 1/2 shares out of the instant land to thisCC, the Plaintiff did not have completed the registration of ownership transfer with respect to 1/2 shares out of the instant land in the name of this case, rather than the instantCC shares, and it is reasonable to deem that the Plaintiff acquired shares out of the instant land in the name of the Plaintiff without returning the ownership of 1/2 shares out of the instant land in the name of this case to the name of thisCC, ③ it is difficult to deem the Plaintiff to obtain shares in the instant land under the name of the Plaintiff as a title trust agreement.

3. Conclusion

The plaintiff's claim is dismissed on the ground that it is without merit.