Supreme Court: "Refusal to Return Mistaken Remittance Is Not Embezzlement If Debt Was Deducted"

[Asia Economy Reporter Heo Kyung-jun] The Supreme Court has ruled that embezzlement charges cannot be applied if the money mistakenly transferred was not fully returned, but only the amount owed was withheld.

The Supreme Court's 3rd Division (Presiding Justice Oh Seok-jun) announced on the 23rd that it overturned the original ruling, which had recognized the embezzlement charges against A, an internal director of a liquor company, and sentenced him to a fine of 300,000 won, and remanded the case to the Suwon District Court.

A was summarily indicted for returning only the remaining amount after excluding about 1.1 million won of liquor payment he had delivered, despite knowing that 4.7 million won was mistakenly transferred from client company B in October 2019.

A had filed a civil lawsuit claiming that he had not received the liquor payment from B and was in legal dispute, but it was investigated that he arbitrarily settled without a separate agreement with B and returned only the remainder.

In the formal trial following A's objection to the summary indictment, the first trial court acquitted A considering that he clearly had money to receive, but the second trial court recognized the embezzlement charge as guilty.

However, the Supreme Court judged, "A's refusal regarding the portion corresponding to the claim amount against B from the money mistakenly transferred by victim B can be seen as a legitimate exercise of the right of set-off."

It added, "Considering the reason for refusing to return the money corresponding to the claim amount for the goods payment and A's subjective intention, it is difficult to conclude that A refused to return the money with the intention of illegal gain."