Living Expense Loan Charges Imposed on Children of Deceased or Severely Disabled Patients Due to Car Accidents... Constitutional Court Rules "Constitutional"

Published 30 Apr.2024 17:03(KST)

The Constitutional Court has ruled that the Enforcement Decree of the Automobile Damage Compensation Guarantee Act, which imposes the repayment obligation of living expense loans on the children of those who died or suffered severe disabilities in car accidents rather than on their legal representatives, does not violate the Constitution.

[Image source=Beomryul Newspaper]

On the 25th, the Constitutional Court dismissed the petition filed by Mr. A against Article 18, Paragraph 1, Subparagraph 2 of the former Enforcement Decree of the Automobile Damage Compensation Guarantee Act with a 5 (dismissal) to 4 (acceptance) vote. Regarding the petition filed by Mr. B, A’s brother, the Court unanimously dismissed it (2021HunMa473).

Mr. C, the father of Mr. A and Mr. B, was raising his children alone after a divorce when he suffered a severe aftereffect disability from a car accident in July 1996. After Mr. C suffered from the aftereffects of the accident, their aunt took care of them for about a year, and thereafter their mother raised them. Mr. C was hospitalized around December 2001 due to brain damage and other conditions, was discharged about six years later in June 2007, but passed away around December the following year.

Mr. A and Mr. B were selected as recipients of living expense loans for children of deceased or severely disabled persons, applied for under their names by their father Mr. C in March 2000 as the legal representative of minor children. The term “children of deceased or severely disabled persons” refers to children under 18 years old (including those up to 20 years old if attending high school) whose parent died or suffered severe aftereffects from a car accident. At that time, Mr. A and Mr. B each received 19.75 million won and 24.75 million won respectively, deposited into accounts under their names from the Korea Transportation Safety Authority.

When Mr. A and Mr. B reached 30 years old and the repayment period set by the loan program began, they filed a constitutional complaint claiming that the Enforcement Decree of the Automobile Damage Compensation Guarantee Act, which imposes the repayment obligation for living expense loans on children, infringed on their right to self-determination and general freedom of action. They argued that they were unaware of the loan application made by their father when they were young and that the loan funds were never used for their benefit.

The Constitutional Court explained, “The provision supports the economic needs for raising children through loans that impose repayment obligations, aiming to recover funds after the children reach 30 years old, the time when they can engage in independent income-generating activities, so that limited resources can be used for as many children as possible.” It added, “There is a limitation in that support for new beneficiaries inevitably decreases when resources are depleted.”

It further stated, “Although the children had no repayment ability at the time the loan was disbursed as they were under 18 years old, it is expected that from the age of 30, except in exceptional cases such as disabilities, they will generally have the ability to repay through independent income activities.”

However, Justices Eun-Ae Lee, Ki-Young Kim, Mi-Seon Lee, and Jung-Jeong Mi dissented. They pointed out that a loan program secured by the uncertain future income of children in difficult living conditions is incompatible with the state’s responsibility for child support and upbringing.

These justices stated, “The provision effectively means that the state conducts a loan program secured by the uncertain future income of children whose father or mother has died or become severely disabled and who are struggling to make a living,” and “The limited financial condition of the state alone cannot justify such a gap in social security systems for these children.”