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The divorce share of 8.6 billion is still too little, Samsung "horse in harness" still want to appeal for equity

Click: Time:2021-08-06 11:29:51


From the grassroots staff to step into the rich family, now divorce was awarded 8.6 billion breakup fee is still not willing, said it will continue to appeal for equity. How can high net worth individuals reduce the loss of property from a marriage?


Recently, the result of the divorce lawsuit between the eldest daughter of the Korean Samsung family and the president of the Shilla Hotel, Lee Boo-jin, and her husband, Ren Woo-jae, has led to a lot of discussion among Korean netizens, who have said that the divorce drama of the rich family is comparable to a dog drama, and the plot is exceptionally exciting.


The company's main business is to promote the development of the company's products and services.


In August 1999, Lee Boo-jin, the eldest daughter of Lee Ken-hee, the richest man in Korea and chairman of the Samsung Group, married to Im Woo-jae, who was an ordinary employee of Samsung at the time, and became a sensation in Korean society. However, this marriage between a rich woman and a grassroots man came to an end after 15 years, with Lee Boo-jin filing for divorce in October 2014, citing a personality disagreement.


Let's sort out the history of their divorce.


In February 2015, Lee Boo-jin filed a divorce lawsuit at the Seongnam Branch of Suwon District Court. After a one-month trial, the court ruled in the first instance that the plaintiff Lee Boo-jin and Im Woo-jae divorced and that the custody and support of her only son would go to the plaintiff.


Ren Woo-jae appealed the judgment, disagreeing with the child custody decision and arguing that the Suwon District Court should not decide on his residence with Lee Bo-jin, which is located in Seoul, the capital. In addition, he sought a share of 1.2 trillion won (RMB 7.22 billion) in family assets.


In October 2016, the Suwon District Court issued a second instance ruling, ruling that the Seongnam Branch of the Suwon District Court had no jurisdiction, reversing the first instance ruling and transferring the lawsuit to the Seoul Family Court for a retrial.


On July 20, the Seoul Family Court ruled that their marriage was dissolved and the custody and support of their only son was given to the plaintiff Lee Boo-jin, while the defendant Im Woo-jae received 8.6 billion won in family assets. It is said that both Lee Boo Jin and Im Woo Jae did not show up at the court on that day. The company's lawyers told the audience that they are not obliged to appear in court.


The lawyer of Lee Boo-jin told Yonhap News Agency on the 20th that the woman accepted the result of the verdict and the specific amount of property division could be confirmed only after receiving the verdict. However, Ren Woo-jae's lawyer said that the property division part omitted the share property, and the man will appeal.


Grassroots man's road to luxury


In August 1999, Lee Boo-jin, the eldest daughter of Lee Ken-hee, the richest man in Korea and the chairman of Samsung Group, married to Im Woo-jae, who was just an ordinary employee of Samsung at that time, and became a sensation in Korean society.


After the marriage, Ren Woo-jae first went to the world's most famous school, MIT, to study a master's degree, and then to the United States and Japan branch training, immediately after returning home to promote the vice president of Samsung Electro-Mechanics, is simply the rhythm of the rise.


However, Ren Woo-jae has also complained many times about the difficulties of being a son-in-law in a wealthy family. He complained in a written submission to the media that he had not seen his grandparents once since the birth of his son until he was 9 years old because he had not been granted permission by the Lee family.


In December 2015, Ren Youzai was reassigned from the position of vice president of Samsung Electro-Mechanics as a "permanent advisor" and withdrew from the management line. It is widely believed that Ren Woo-jae's "loss of office" was to some extent affected by his divorce lawsuit with Lee Boo-jin.


The loss of property is not the only thing that can be lost in a marriage of a powerful family


In February this year, the actual controller of Samsung Group, Lee Jae-yong, was arrested this year for his involvement in Park Geun-hye's "cronyism" case, and the outside world has been paying close attention to who will take over Samsung. There was speculation that Lee Boo-jin might take advantage of the situation and "take over" the Samsung Group.


Lee Boo-jin

Lee Boo-jin is 46 years old and is currently the richest woman in South Korea. According to Forbes magazine, she is estimated to be worth about $1.96 billion (13.27 billion yuan). Lee was ranked 98th in Forbes' 2016 list of the world's top 100 women.


Although the breakup fee of 51.76 million yuan is not a lot for Lee Boo-jin, who is worth $1.96 billion (13.27 billion yuan), Ren Woo-jae, who took away 8.6 billion won, is still not happy about it and is thinking of dividing his share of the property.


Source: Xinhua,, Asia Economy Korea



In South Korea, it is not uncommon to see divorces of plutocrats like this, where the division of property can easily be hundreds of billions or even trillions of won. In addition to the divorce of Samsung's "sidekick" who received 50 million but still appealed, the divorce of Jung Sol-jin, vice chairman of Shinsegae Group, and actor Ko Hyun-ting also became a topic of conversation after dinner. The two got married in 1995 and divorced by agreement in 2003 after 8 years. Ko Hyun-jeong received 1.5 billion won in property at the time, and the custody of the children went to Jung Sol-jin.


In the divorce case, Ncsoft Group paid the largest amount of money on behalf of Kim Zechin, and in 2004, he gave his ex-wife shares of the company with a market value of more than 30 billion won.


For most entrepreneurs, problems in marriage and family often invariably affect the development of the business and even determine the fate of the business.


One case shows us that planning wealth well in advance is especially important for high net worth individuals. Such as signing a legal and effective prenuptial agreement, setting up a family trust, using insurance, wills and other wealth transfer tools will effectively avoid risks such as wealth outflow to the business and family due to changes such as divorce and unexpected death.


Learn how to use insurance for wealth leverage

As HNWIs become more sophisticated in wealth management, wealth security, wealth preservation and wealth inheritance have become increasingly important to HNWIs. Life insurance (note: all references to "insurance" in this article refer to "life insurance") has become an indispensable functional lever for wealth management due to its special role in private wealth preservation and risk segregation. In recent years, it is no longer uncommon for HNWIs to take out policies with a large sum insured of millions or even tens of millions of dollars or more.


For HNWIs, insurance has not only its basic protection function, but also its legal and financial functions to meet a series of private wealth management needs.


1. Asset Protection


Debt risk, marriage risk, and illegitimate child risk threaten the safety of private wealth at all times. Using insurance to build a firewall for private wealth is a safe option to consider. According to the basic principles of insurance and the provisions of the Insurance Law, no entity or individual may illegally interfere with the insurer's obligation to compensate or pay insurance benefits, nor may they restrict the insured or beneficiary's right to obtain insurance benefits. The insurance benefits of the designated beneficiary are not subject to seizure and freezing, forfeiture, inclusion in bankruptcy claims, or division as marital property. Regardless of where the debts come from, where the marriage goes, whether three wives or four concubines, or children and grandchildren, the insurance money always belongs to the designated beneficiary and is private property that is not in dispute.


Unfortunately, many people do not care about the insurance policy, often "beneficiary" column blank. The result is that in the event of the death of the insured, the life insurance proceeds will be treated as an inheritance and will need to be used to settle the insured's debts or assume liability. In this way, the function of asset preservation is lost. Therefore, the "policy audit" for wealthy families is indispensable.


2. Safe inheritance


Inheritance disputes have increased dramatically in recent years, and family discord and rebellion are the love-hate relationship of wealthy families. If you arrange insurance inheritance planning and designate beneficiaries before your death, you can avoid your wealth from being squandered or misappropriated, and you can complete the inheritance of your property exactly as you wish, and get the strongest protection from the law. In addition, the policyholder can change the beneficiary at any time, so that he or she can control the wealth more flexibly and realize the safe and desired inheritance of wealth.


3. Reasonable tax avoidance


Life insurance is a human life asset and is not subject to taxation. According to Article 4 of China's Personal Income Tax Law, insurance payouts are exempt from personal income tax, which is an obvious function. In China, the more forward-looking and practical tax avoidance function of insurance is to avoid estate tax.


It has been a common practice overseas for high net worth individuals to use insurance to avoid inheritance tax. A classic case that has been widely praised by the media and the industry is the stark contrast between Y.C. Wang and Wan-Lin Tsai.


The founder of Formosa Plastics Group, Y.K. Wang, left a huge estate in Taiwan worth over NT$60 billion when he died. The inheritance tax rate was as high as 50%, and his heirs had to pay an inheritance tax of 11.9 billion yuan before they could receive the entire estate, which was the highest inheritance tax record in Taiwan at the time. In contrast, the estate of Taiwan's former richest man, Tsai Wan-Lin, who died with an inheritance of over NT$156.4 billion, was only subject to an inheritance tax of NT$600 million. The reason for this is that Tsai Wan-Lin had purchased a multi-billion dollar life insurance policy during his lifetime. Through the insurance arrangement, the inheritance tax payable by Wan-Lin Tsai was greatly reduced and his estate was safely passed on to his children.


China has not yet introduced estate tax, but a series of operations such as real-name bank accounts, property tax levy, personal tax declaration, and implementation of property law are gradually paving the way for the introduction of estate tax legally and institutionally. High-net-worth individuals should make use of insurance for reasonable tax avoidance as early as possible.


4. Debt avoidance


According to the law, the funds for purchasing insurance are divested from personal assets when they are delivered to the insurance company, and no institution including the court can use the insurance for the reason of incurring debts. According to Article 73 of China's Contract Law, if the creditor is damaged by the debtor's negligence in exercising its claim as it becomes due, the creditor may request the people's court to subrogate the debtor's claim in its own name, except that the claim belongs exclusively to the debtor itself. According to the relevant judicial interpretation of contract law, life insurance is a claim belonging exclusively to the debtor itself, and the rights of the beneficiary are greater than the claim. Therefore, once a debt dispute arises and personal assets are set off, confiscated or seized, the insurance can still remain in effect and the creditor has no right to demand the debtor to pay the debt with the insurance benefits. In this way, the debtor can leave a large amount of wealth for himself and his family through insurance.


However, special attention should be paid to the fact that the above-mentioned purpose of debt avoidance can only be achieved if the beneficiary is clearly designated. According to Article 42 of the Insurance Law, if no beneficiary is designated, if the designation is unclear, if the beneficiary dies, or if the beneficiary is only listed as "legal" in the beneficiary section of the insurance policy, when the insured dies, the insurance proceeds become the insured's estate, which requires the insurance proceeds to be used to pay off the debtor's debts during his or her lifetime.


Of course, not all insurance policies have the function of debt avoidance, such as the dividends of participating insurance policies, which are based on financial management functions and are fundamentally different from those based on protection functions, and the possibility of being used by the court to offset debts under special circumstances cannot be ruled out.


5. Low-cost financing


Many people hold large policies, but they do not know that the policies can be pledged and used to obtain loans from insurance companies and banks. A loan from an insurance company against a policy pledge is easy to process, fast to pay, and the interest rate is lower than the bank loan rate. The loan amount of the policy pledge is usually 80% of the cash value of the policy and can be obtained for a maximum period of 6 months, thus meeting short-term financial needs. As long as the loan is repaid on time and the premiums are paid normally, it will not affect any insurance function and policy benefits of the original policy at all. And if an insurance accident occurs during the policy pledge loan, the insurance company will still make claims in accordance with the insurance contract, only to deduct the loan amount from the final claim amount. This legally protects both the insurance interest and the facility to obtain financing. Of course, not all policies can be used for pledging loans, for example, in addition to policy type restrictions, policies that have had premium waivers cannot be pledged for policy loans. Relatively speaking, there will be some restrictions in terms of examination and surrender when applying for policy pledge loans from banks by virtue of the policy. However, it is still a worthwhile financing tool.


Especially important is that the use of insurance financing can also be derived from the "crisis relief" "back to life" function. As we mentioned earlier, assets such as money, real estate and stocks can be seized and frozen at any time, or even enforced. The unique function of insurance to isolate these legal measures, so that the rights holders can apply for policy pledge loans when they are "at the end of their rope", in order to get the opportunity of "rebirth".


All the aforementioned insurance functions have shown us the magic of insurance as a wealth lever. However, no tool is a panacea, and as a legal professional, it is important to note that although insurance has many functions to avoid taxes, debts and risks, not all insurance policies have the same functions. And especially important, if the insured funds are illegal income, illegal transfer of property to escape debts, money laundering, involved in criminal offenses, etc., then the court can still be frozen, seized, seized and recovered according to the law, and even ruled that the insurance company forced to surrender the policy.







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DC.WEALTH.(Hong Kong)

(852) 2115 9097

(852) 2117 1522

Room 603, Low Block, New Era Plaza, 181 Queen's Road Central, Hong Kong


(86) 571 8970 5282

(86) 571 8970 5280

Room D, 11F, Dikai International Center, No.19 Dangui Street, Qianjiang New Town, Hangzhou, China


(86) 18805749323

Room 404, 1872 Office Building, No.518 Wan Tou Road, Jiang Bei District, Ningbo


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