The key issue that divided the Supreme Court in the divorce case between SK Group Chairman Chey Tae-won and Roh Soh-yeong, director of Art Center Nabi, was the legal characterization of the so-called “Roh Tae-woo’s slush fund.” The court concluded that because the fund constituted bribes, illegal in nature, they are not protected by law and cannot be included in the division of marital property.

On October 16, the Supreme Court’s First Division (Presiding Justice Seo Kyung-hwan) sent the case back to the Seoul High Court, defining the 30 billion won that Roh Soh-yeong’s father, the late former President Roh Tae-woo, allegedly gave to Chey Jong-hyon, Chey Tae-won’s father and the late founder of SK, as illegal bribes. The ruling stated, “Providing a large portion of a bribe to in-laws or their children and concealing it to prevent the state from tracing and confiscating the fund violates good morals and social order, displaying such anti-social, unethical, and immoral characteristics that it falls outside the protection of the law.”

During the appellate trial, Roh’s legal team submitted two handwritten notes from Roh Tae-woo’s wife, Kim Ok-sook, that read “Sunkyung 30 billion won,” along with six promissory notes worth 5 billion won each. Roh argued that the slush fund given to the SK family became the foundation of the conglomerate’s growth and that Chey had increased his wealth through it. The appellate court accepted this argument, raising the amount of asset division from 66.5 billion won in the first trial to 1.38 trillion won, more than 20 times higher.

The Supreme Court, however, ruled this judgment erroneous. It determined that regardless of whether the slush fund actually existed, the money would constitute an “illegal cause benefit” under civil law, as it was obtained through unlawful means. Article 746 of the Civil Code stipulates that when property or services are provided for an illegal cause, the provider cannot demand restitution. The court further noted, “Even if the defendant (Roh So-young) claims the fund as part of her contribution in the division of property, rather than seeking restitution, the illegality of the fund remains unchanged.”

The court also overturned the appellate ruling that included certain assets, such as stocks donated by Chey to foundations and relatives between 2012 and 2014, and salary he returned to SK Group, as part of the divisible property. The Supreme Court found that these disposals took place before December 2019, the date when the lower court deemed the marriage irreparably broken, and that the transactions were linked to maintaining the couple’s joint assets. “These were compensations to Senior Vice Chairman Chey Jae-won and other relatives who made concessions to ensure a smooth succession of SK Group’s management rights,” the court said. “Their connection to the formation and maintenance of marital assets cannot be excluded.”

In essence, property that has already been disposed of for the purpose of maintaining or managing joint assets cannot later be included in the division of assets. The ruling is significant because it sets a clearer legal standard for evaluating asset disposals made before divorce.

Following the Supreme Court’s decision, the Seoul High Court will recalculate Roh’s share of the marital assets in the retrial, excluding the slush fund portion in accordance with the higher court’s findings. As the Supreme Court also found fault with the lower court’s division ratio of 65 percent to Chey and 35 percent to Roh, that proportion is also likely to change.