Court Rules "Choi Tae-won's SK Shares Are Separate Property... Excluded from Property Division"… 66.5 Billion KRW Cash Division Ordered

Chairman Chey Tae-won of SK Group and Director Noh So-young of Art Center Nabi.

[Asia Economy Reporter Choi Seok-jin, legal affairs specialist] It was reported on the 6th that the court in the divorce and property division claim case between SK Group Chairman Chey Tae-won and No So-young, director of Art Center Nabi, ruled that the SK Inc. shares held by Chairman Chey are his separate property and excluded them from the property division.

The Family Agreement Division 2 of the Seoul Family Court (Presiding Judge Kim Hyun-jung) held the first trial verdict hearing for the divorce lawsuit between Chairman Chey and Director No on the afternoon of the 6th and ruled their divorce. The court also ordered Chairman Chey to divide 66.5 billion KRW in assets to Director No and pay 100 million KRW in alimony.

The focus that day was how much of the property division claim filed by Director No the court would recognize.

The court decided on a property division of 66.5 billion KRW, which did not include the SK Inc. shares requested by Director No.

According to the court, Director No claimed property division for SK Inc. shares held by Chairman Chey, shares of affiliates, real estate, retirement pay, and other assets.

In particular, Director No requested the division of half of the 12,975,472 shares of SK Inc. held by Chairman Chey, amounting to 6,487,736 shares.

However, the court judged that it was difficult to see that Director No substantially contributed to the formation, maintenance, and value increase of the SK Inc. shares held by Chairman Chey, and thus classified them as separate property, excluding them from the property division.

The court then considered only some affiliate shares, real estate, retirement pay, deposits held by Chairman Chey, and Director No’s assets as subject to division, and after comprehensively considering the course and duration of the marital life and the circumstances of the formation of the property subject to division, ordered Chairman Chey to pay Director No a total of 66.5 billion KRW in cash as property division.

During the trial, Chairman Chey’s side argued that the shares originated from SK affiliate shares gifted or inherited from his late father, former Chairman Chey Jong-hyun, and thus should be regarded as separate property.

Separate property refers to property owned by one spouse before marriage or property acquired in their name during the marriage, which is generally not subject to division.

On the other hand, Director No’s side argued that in the case of couples married for a long time, property gifted or inherited by a spouse should be considered joint property. Their logic was that since Chairman Chey became the largest shareholder of SK Inc. through the merger with SK C&C (formerly Dacom Telecom) after marriage, it should be regarded as property formed during the marriage.

The Supreme Court holds that a divorced spouse’s claim for property division also has a supportive nature to maintain the other party’s livelihood after divorce, but fundamentally, the main purpose is the liquidation of joint property formed through the cooperation of both parties during the marriage.

Furthermore, even if the property was formed based on inherited wealth, if it is recognized that the spouse contributed through domestic labor and support in acquiring and maintaining the property, it can be subject to property division.