Supreme Court: "If a Legal Scrivener Handles Personal Rehabilitation and Bankruptcy Cases Comprehensively, It Violates the Attorney Act"… Fine of 20 Million Won and Additional Collection of 320 Million Won Confirmed

Supreme Court Grand Bench.
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[Asia Economy Reporter Choi Seok-jin, Legal Affairs Specialist] The Supreme Court has ruled that if a certified judicial scrivener comprehensively handles all necessary tasks beyond the scope of their duties, such as document preparation and submission on behalf of clients in personal rehabilitation or bankruptcy cases, it constitutes a violation of the Attorney-at-Law Act.

The Supreme Court presented as grounds that the scrivener did not set fees based on the documents prepared or submitted but rather per case, and that notifications related to the cases were received directly from the court, which can be seen as evidence of representing the case itself.

The Supreme Court's Third Division (Presiding Justice Lee Heung-gu) confirmed the lower court's ruling on the appeal of certified judicial scrivener A, who was indicted for violating the Attorney-at-Law Act, sentencing him to a fine of 20 million won and ordering the confiscation of approximately 320 million won on the 21st.

The court stated, "There is no error affecting the judgment such as failing to conduct necessary hearings for the lower court's decision, violating the rules of logic and experience beyond the limits of free evaluation of evidence, misinterpreting 'duties of certified judicial scriveners' as defined in Article 2(1) of the Certified Judicial Scrivener Act, misinterpreting Article 109(1)(a) of the Attorney-at-Law Act, misunderstanding the law, or the principles regarding confiscation."

Article 2(1) of the Certified Judicial Scrivener Act enumerates the duties of certified judicial scriveners as including ▲preparation of documents submitted to courts and prosecutors' offices ▲preparation of documents related to the work of courts and prosecutors' offices ▲preparation of documents necessary for registration or other registration applications ▲representation in registration and deposit cases ▲representation in personal bankruptcy and personal rehabilitation cases (excluding representation in statements at various hearings) ▲submission of prepared documents on behalf of clients ▲and incidental tasks such as consultation and advice necessary to handle these affairs.

Meanwhile, Article 3 of the Attorney-at-Law Act (Duties of Attorneys) states that "Attorneys shall perform litigation-related acts and representation concerning administrative disposition claims, as well as general legal affairs, by delegation from parties or other related persons, or by commission from the state, local governments, or other public institutions."

A was prosecuted on charges of receiving approximately 466 million won in fees for handling about 420 personal rehabilitation and bankruptcy cases collectively from 2010 to 2016.

The prosecutor argued that although A was not an attorney, he received a fee of 1.2 million won per case for personal rehabilitation cases, then prepared and submitted documents such as personal rehabilitation applications, creditor lists, statements, and repayment plans to the court, thereby comprehensively undertaking legal affairs like an attorney, violating the Attorney-at-Law Act.

Article 109(1) of the Attorney-at-Law Act (Penalties) stipulates that a person who is not an attorney and receives or promises to receive money or other benefits, or promises to provide or causes a third party to provide such benefits, and handles or mediates appraisal, representation, legal consultation, preparation of legal documents, or other legal affairs related to litigation or non-litigation cases shall be punished by imprisonment for up to seven years or a fine of up to 50 million won.

The key issue in the trial was whether A had indeed exceeded the scope of duties of a certified judicial scrivener and was comprehensively entrusted with legal affairs like an attorney.

The first trial court acquitted A, citing insufficient evidence from the prosecution that A, after accepting personal rehabilitation cases, led the case processing and substantially represented the client in all procedures necessary for the application and execution of the case.

The court stated, "Whether a certified judicial scrivener's act of being entrusted by a client to prepare documents for submission to the court, providing consultation accordingly, preparing necessary documents, and submitting them on behalf of the client constitutes 'representation' prohibited by the Attorney-at-Law Act should be determined based on whether the scrivener actually led the case processing and substantially represented the client in all procedures necessary for the application and execution of the case."

It further explained, "Especially in personal rehabilitation cases where multiple types of documents must be submitted simultaneously with the application, and the contents of the documents are relatively standardized, simply preparing and submitting various documents at once and deciding the fee collectively cannot easily be deemed as 'representation' prohibited by Article 109(1) of the Attorney-at-Law Act."

However, the second trial court's judgment differed.

Relying on Supreme Court precedents, the second trial court stated, "Considering the purpose of Article 109(1) of the Attorney-at-Law Act, which prohibits non-attorneys from engaging in legal affairs to maintain the attorney system, 'representation' here includes not only legal representation by delegation in the name of the representative but also acts performed on behalf of the principal requiring legal knowledge, or acts where the non-attorney effectively leads the case processing for a principal lacking legal knowledge, even if the external form is that the principal acts directly, thus producing the same effect as representation without the formalities."

In other words, even if legal acts are performed in one's own name and do not have the formalities of legal 'representation' that attribute effects to the principal, if the substance corresponds to representation, it should be regarded as 'representation' prohibited by the Attorney-at-Law Act in litigation or non-litigation cases.

The court pointed out, "It is recognized that the defendant, while handling clients' personal rehabilitation and bankruptcy cases at the certified judicial scrivener office, did not set fees based on document preparation or submission but per case, then prepared and submitted creditor lists, property lists, statements, repayment plans, correction documents, etc., to the court, received related notifications directly from the court, and comprehensively handled all necessary tasks including document preparation, submission, correction, and service until the case was concluded."

It continued, "The defendant's acts cannot be regarded as mere document preparation or submission agency, and it is reasonable to view that the defendant, in violation of the Attorney-at-Law Act, effectively led the case processing and substantially represented clients in all procedures necessary for the application and execution of the case. This applies even if personal rehabilitation or bankruptcy cases like those handled by the defendant have characteristics such as concluding after a certain period from acceptance or requiring simultaneous submission of some related documents."

For these reasons, the court overturned the first trial ruling and convicted A for 386 personal rehabilitation and bankruptcy cases handled from around February 16, 2010, to December 16, 2016, with fees totaling approximately 459 million won.

On the other hand, regarding 40 cases (with fees of 6.6 million won) among the approximately 420 personal rehabilitation and bankruptcy cases included in the indictment that A took over from office managers, the court dismissed the prosecution's appeal, maintaining the first trial's acquittal, stating, "The indictment itself does not clearly show what specific acts the defendant performed, and the evidence submitted by the prosecution is insufficient to recognize that the defendant engaged in acts constituting representation prohibited by Article 109(1) of the Attorney-at-Law Act in these cases."

The Supreme Court also agreed that the second trial court's judgment was correct.

This content was produced with the assistance of AI translation services.