'Refusal of Psychiatric Evaluation at Severance Due to COVID-19'... Prolonged Limited Guardianship Trial of Jo Yang-rae

Request for Limited Guardianship Trial Passed 1 Year but Stalled
Second Refusal of 'Psychiatric Evaluation' Following National Mental Health Center
Eldest and Second Sons' Establishment of New Technology Company Leads to Off-Stage Conflict

[Image source=Yonhap News]

[Asia Economy reporters Ki-min Lee and Dae-hyun Kim] It has been confirmed that Sinchon Severance Hospital refused the court's request for a psychiatric evaluation related to the limited guardianship trial of Cho Yang-rae, chairman of Hankook & Company. Although a year has passed since the limited guardianship trial was filed, the psychiatric evaluation procedure, which is central to the trial, has not been conducted, prolonging the management rights dispute at Hankook Tire.

According to the legal community and the Hankook Tire Sharing Foundation on the 14th, Sinchon Severance Hospital, which was requested by the Seoul Family Court to conduct a psychiatric evaluation of Chairman Cho, recently declined. The psychiatric evaluation is a step in the limited guardianship trial to determine whether the respondent has mental restrictions. Cho Hee-kyung, eldest daughter of Chairman Cho and chairwoman of the Hankook Tire Sharing Foundation, stated, "Severance Hospital returned the request letter, citing difficulties in conducting a prompt evaluation due to the COVID-19 situation."

If the hospital refuses the evaluation, the court has no means to enforce it, so it must either wait for the COVID-19 situation to stabilize or select another hospital to request the psychiatric evaluation. Cho's side said, "Although the COVID-19 situation is severe, the court recognizes that it is most important to eliminate controversy by conducting a proper inpatient psychiatric evaluation at a specialized institution. Therefore, a reliable hospital must be selected again to send the psychiatric evaluation request." However, a Seoul Family Court official said, "The process of finding another hospital to conduct the psychiatric evaluation may take longer than receiving the evaluation from the existing hospital."

Following the National Mental Health Center, Sinchon Severance Hospital also refused Chairman Cho's psychiatric evaluation due to COVID-19, putting the limited guardianship trial, which has been ongoing for over a year, into a standstill again. The trial began last July when Cho's daughter filed for the initiation of limited guardianship. She argued that an objective judgment was necessary to determine whether Chairman Cho's decision to transfer all shares to his second son, Cho Hyun-bum, president of Hankook & Company, was voluntary.

The Seoul Family Court requested the National Mental Health Center to conduct a psychiatric evaluation of Chairman Cho during the first hearing in April. At that time, Cho's daughter, the petitioner for the limited guardianship initiation, submitted a request to the court to change the evaluation period, stating that the psychiatric evaluation should be conducted at Bundang Seoul National University Hospital. The intention was to receive objective and precise examinations at the country's top medical institution to avoid any controversy.

In June, the National Mental Health Center, designated as a COVID-19 dedicated hospital, requested the court to designate another hospital as inpatient treatment was not possible. It was expected that Bundang Seoul National University Hospital or Asan Medical Center, which have partnerships with the court, would be designated. However, after coordinating opinions from the parties and witnesses, the court newly designated Sinchon Severance Hospital as the psychiatric evaluation institution. It is known that the Cho family members each preferred different hospitals.

At the regular shareholders' meetings of Hankook & Company and its affiliate Hankook Tire & Technology in March, Cho, president of Hankook & Company, and Cho Hyun-sik, vice chairman of Hankook & Company, exchanged wins and losses in votes for outside directors and audit committee members, respectively, and this year they appear to be engaged in an off-stage battle by establishing subsidiaries related to new technology businesses.

Recently, Hankook & Company established three companies: MW Holding, for holding business, asset management, investment, and new technology investment; MW & Company, a company for investing in and managing new technology businesses; and I&B Corporation, which handles holding business, new technology investment and financing, and management.

Among these, MW Holding and MW & Company have Vice Chairman Cho registered as the representative, while I&B Corporation is registered under Hankook Tire, an affiliate of Hankook & Company where President Cho is the largest shareholder.