Unconstitutional statute

The Unconstitutional statute (위헌법령/違憲法令) refers to a statute declared unconstitutional by the Constitutional Court.

Take an example that an administrative action was taken subject to a provision of an Act, which has been ruled unconstitutional by the Constitutional Court. Then is the effect of such administrative action null and void, or is it to be revoked by the competent authority?

Key words
administrative disposition, unconstitutional, void ab initio (당연무효), tax claim

Supreme Court cases
Supreme Court en banc Decision 2010Du10907 decided on February 16, 2012 [Confirmation of Invalidity of Disposition Including Attachment, etc.]

Facts
As X Corp. failed to pay tax, the tax office sought another tax obligor to impose the tax amount. Regarding X Corp.'s default of national taxes, the tax authority held Y, the lineal descendant and also cohabitant of the largest shareholder of X Corp., as the secondary taxpayer in accordance with Article 39 (1) 2 (c) of the previous Basic Act for National Taxes (국세기본법, amended as Act No. 5579 on Dec. 28, 1998), and issued and established a taxation disposition.

Later, the relevant provision of the Act was held by the Constitutional Court as unconstitutional. However, the tax authority still issued an order for attachment on Y's bank deposit so as to enforce tax claims.

Ruling
In February 2012, the full bench of the Supreme Court decided in the affirmative:
 * Whether the administrative action, or disposition, to enforce tax claim pursuant to the provision of the Act at issue is void ab initio.
 * Whether the judgment below was right which held that the disposition to attach Y's deposit with a bank is void ab initio rather than to be revoked.

Reasoning by Majority Opinion

 * By Chief Justice Yang Seung-tae (Presiding Judge), Justices Park Ill-hoan, Kim Nung-hwan, Jeon Soo-ahn, Yang Chang-soo, Min Il-young (Justice in charge), Lee In-bok, Lee Sang-hoon, Park Byoung-dae, Park Poe-young

Article 47 (1) of the previous Constitutional Court Act (amended as Act No. 10546 on April 5, 2011) provides that "a decision of unconstitutionality by law binds the court, other government bodies, and local governments." In light of the systematic demand which upholds the binding force of decisions of unconstitutionality and the Constitution as the highest standard, neither government bodies nor local governments may enforce new administrative dispositions on provisions decided as unconstitutional; even in the case of executing a subsequent disposition should the action create or expand new unconstitutional legal relations.

Thus, when a provision that was the basis of a tax imposition is declared unconstitutional: any new disposition on default, or continuance against the validity of the decision of unconstitutionality is in itself critically at fault and void ab initio, and is therefore prohibited.

This is applicable even in cases where the taxation was ordered before the decision of unconstitutionality; the period for filling a suit on the taxation order has expired and the tax claim decision is finalized; and the applicable provision for tax claim is not decided to be unconstitutional.

Thus when an applicable provision for a tax imposition is declared unconstitutional, any new or continuing enforcement of a disposition on default following the above-mentioned decision of unconstitutionality is disallowed. When the very provision of the tax imposition was ordered before the decision of unconstitutionality, even though the period for filling suit had expired and the tax claim was finalized, and accordingly the above-mentioned provision at issue has not been decided unconstitutional, the tax authority's disposition on default which goes against the validity of the decision of unconstitutionality is in itself a grave error and is objectively and undoubtedly void ab initio.

Dissenting Opinion

 * By Justices Ahn Dai-hee, Shin Young-chul, Kim Yong-deok

When an administrative agency issues a disposition based on a legal provision which is afterwards decided to be unconstitutional by the Constitutional Court, the administrative disposition is essentially without legal basis and thus subsequently defective.

However, the decision of unconstitutionality is not objectively clear prior to the Constitutional Court's decision of unconstitutionality, so such errors are ground for revocation but not ground for void ab initio unless in unusual circumstances.

Thus it cannot be said that the defects within the preceding disposition is inherited to the following disposition when an independent activity is successively issued with a particular administrative purpose, unless the preceding disposition is defective by void ab initio or non-existence.

As taxation and attachment disposition are separate administrative dispositions, it is appropriate that the validity of the following attachment disposition after default (in this case, attachment disposition) is unchallengeable unless the preceding disposition (in this case, taxation) is void ab initio.

Also, taxation provisions cannot effect certain dispositions of collateral after default such as the attachment disposition, which are effected by attachment disposition provisions; thus the binding force of the decision of unconstitutionality is unrelated to and cannot effect the attachment disposition. The majority opinion's prohibition of continuance of a disposition on default - which was issued due to a valid taxation disposition - has essentially extended the binding force of the decision of unconstitutionality to the degree of allowing denial and termination of the validity of the initial disposition.

This does not coincide with the purpose of Article 47 (2) of the Constitution Court Act, which provides that when a taxation disposition as a preceding disposition has no ground for void ab initio; the very provision for the attachment disposition based on a taxation disposition remains effective.

Since the Korean law - unlike certain foreign countries - has no written provision that provides the abatement of binding forces of a decision of unconstitutionality, we cannot agree with the majority opinion which perceives the attachment disposition as illegal simply because the basis provision for the taxation disposition was decided to be unconstitutional by the Constitutional Court.

Implications
These days the Constitutional Court does not hesitate to declare some statutory ground for administrative actions unconstitutional. On August 23, 2012, the Constitutional Court ruled unanimously that the real name policy requirement imposed on big portal servive providers pursuant to Article 44 (1) 2 of the Act on Promotion of Information and Communications Network Utilization and Data Protection, etc. is unconstitutional.

Then is the competent authority's enforcement void ab initio? Or is it to be revoked by the relevant authority? The answer is that it is void ab initio with no further administrative action to revoke it.