SK Group chairman faces deadline to appeal 944 billion won divorce settlement

SK Group Chairman Chey Tae-won and his ex-wife Roh Soh-yeong face a deadline Friday to decide whether to appeal a 944 billion won ($666 million) property division ruling that could bring an end to a nine-year legal battle dubbed the divorce of the century.

The deadline to appeal the Seoul High Court's July 24 ruling to the Supreme Court expires at midnight Friday. If neither side files an appeal by then, the 944 billion won property division award will become final.

Legal experts say the chances of the ruling being overturned are slim. The Supreme Court reviews questions of law rather than factual findings, making it unlikely that the case would be overturned again after it was previously sent back by the top court for reconsideration.

For Chey, however, an appeal could delay when the ruling becomes final and give him more time to secure the cash needed to pay the settlement. The Seoul High Court ordered the entire 944 billion won to be paid in cash, taking factors such as Chey's control and management of SK Group into account.

"If he appeals again, there would be little reason other than to delay the payment deadline," said an attorney who previously worked as a Supreme Court research judge. "He is unlikely to expect the ruling to be overturned, but it could give him time to raise the cash."

An appeal would also delay the accrual of interest on the settlement. Once the ruling becomes final, the unpaid amount will accrue interest at an annual rate of 5 percent beginning the following day, equivalent to about 129 million won per day.

A final ruling would also allow Roh to pursue immediate collection of the settlement, giving Chey another potential incentive to appeal.

Chey could instead decide that ending the uncertainty surrounding the prolonged litigation would be more beneficial for SK's management than continuing a legal battle with little prospect of success.

If he uses his SK shares as collateral to borrow money for the settlement, he would also face risks including additional collateral requirements or forced liquidation if the share price falls, as well as interest costs. Business circles have suggested that Chey could use his holdings in SK Siltron or raise funds by pledging his stake in SK Inc. as collateral.

Chey's legal team was reportedly still considering whether to appeal as the deadline approaches. Business circles expect a decision to come Friday afternoon.

An appeal would also require Chey's lawyers to identify a new legal issue for the Supreme Court to consider. The latest Seoul High Court proceedings focused on whether SK Inc. shares should be included in the property division, the proportion to be divided and the appropriate date for calculating their value.

"All of the issues concern factual findings, so even if they develop grounds for another appeal, it would not be easy to overturn the ruling," said an attorney who previously served as a presiding judge.

For Roh, legal observers see little incentive for her to appeal, as the latest ruling accepted her argument that SK shares should be subject to division and reflected the increase in their value in calculating the settlement.

"The outcome appears favorable for Roh," a legal source said. "It may be more beneficial for her to have the ruling finalized quickly and receive the property division payment."

It is not known whether Roh is considering an appeal.

If neither side files an appeal by Friday's deadline, the litigation — which has lasted more than nine years — will come to an end.

Chey publicly announced his intention to divorce in 2015 while revealing that he had a child outside the marriage. The legal battle began in July 2017 when he filed for divorce mediation.

The amount awarded in the property division swung sharply from 66.5 billion won to 1.38 trillion won through the first and second trials as the courts reached different conclusions over whether Chey's SK holdings should be included in the marital assets subject to division.

The Supreme Court sent the case back to the lower court last October, ruling that alleged slush funds tied to Roh's father, late former President Roh Tae-woo, should not be counted as her contribution to the couple's marital assets.

On remand, the Seoul High Court determined that the SK shares should still be included in the property division but recalculated the award in line with the Supreme Court's ruling, setting it at 944 billion won.

BY CHOI SEO-IN [shin.woojin@joongang.co.kr]