People have the obligation to pay tax by law under Article 19 of the Constitution, and the state, when imposing or reducing such obligation, must govern the taxation subject, object, basis and rate by law or authorized orders as held by this Yuan in previous Interpretations.

       Article 1030-1 of the Civil Code, which was promulgated on June 3, 1985 (hereinafter referred to as Article 1030-1 or the new law), provides that, "Upon termination of the united property regime, the remainder of the property acquired by the husband or wife within marriage, after deduction of the debts incurred during the marital relationship, if any, should be equally distributed between the two, except those acquired from succession or other endowment".  The legislative intent was to recognize the spousal contributions, such as doing household chores, raising children and others, made to maintain marital life.  Consequently, apart from those obtained from succession or other endowment, the remainder of the shared property acquired by joint efforts during the marital relationship, upon death of a spouse which terminates the relation of such shared property, should not been deemed as belonging to the deceased’s property, and thus be included in the levying of inheritance tax.

       If a marriage was constituted previous to the enactment of Article 1030-1 but the shared property regime was terminated by death after June 5 on which the provision became effective, the new law should apply.  As a result, the remainder of the property acquired by the husband or wife within marriage, except those items acquired from succession or other endowment, should be subject to the right to surplus distribution, and there should be no differentiation regarding whether the property was acquired before or after the date of enactment of the law.  The surviving spouse who exercises this legal right to surplus distribution should be protected under the legislative purposes of the Estate and Gift Taxes Act and the substantial taxation principle.  As a result, the claimed amount of surplus distribution should be excluded and deducted from the property on which inheritance tax is to be levied.

       The Resolution made in the Joint Meeting of the Supreme Administrative Court on March 26, 2002, reduces the amount of deduction from the deceased’s property and thus increases the people’s obligation to pay tax without the authorization of law.  It is thus considered null and void for violating the above principles and the “principle of taxation by law” principle administered under Article 19 of the Constitution.

       Resolutions of the Supreme Administrative Court, which render specific opinions on law application, are specifically intended to provide reference for judges when deciding cases and may not be taken as the equivalent of judicial precedents.  However, such resolutions are made under law (Article 30 of the Organic Act of the Administrative Court and Article 28 of the Order Governing the Disposition of Affairs of the Administrative Court) and articulate opinions of the Court on specific issues, and thus they shall be taken as being equivalent to ordinances when cited by court decisions.  As held in Judicial Interpretation No.374 of this Yuan, people may apply for judicial review of such resolutions according to Article 5, Paragraph 1, Subparagraph 2, of the Constitutional Interpretation Procedure Act. 

       Under Article 19 of the Constitution, people have the obligation to pay tax by law, and the state, when imposing or reducing such obligation, must regulate the taxation subject, object, basis and rate by law or authorized orders as held by this Yuan in previous Interpretations.  The Supreme Administrative Court, when rendering specific legal opinions with a Resolution, should abide by general rules governing legal interpretation, and should especially adhere to legislative purposes and constitutional principles.  Proceeding otherwise exceeds the authority of legal interpretation and increases people’s obligation to pay tax, thus constituting a violation of the “principle of taxation by law” principle under Article 19 of the Constitution. 

       Article 1030-1 of the Civil Code, which was promulgated on June 3, 1985, provides that, "Upon termination of the shared property regime, the remainder of the property acquired by the husband or wife within marriage, after deduction of the debts incurred during the marital relationship, if any, should be equally distributed between the two, except those acquired from succession or other endowment".  The legislative reason for this provision is: "When the relation of shared property terminates, the remainder of the marital property should be shared equally between the spouses to achieve fairness and thus to uphold the principle of sexual\gender equality” For example, in a family where the husband is the breadwinner while the wife is the homemaker, who does family chores and takes care of dependent children so as to excuse the husband from household maintenance so he can concentrate on developing his career, the marital property thus accumulated should be equally attributed to the wife’s efforts.  Therefore, the wife has the right to claim an even share of the remainder of marital property, excluding those of inheritance and endowment.  This also applies in the case of a househusband (See Record of the 38th meeting of the Legislature, pp. 58-59, Vol. 74, of the Legislative Yuan Pamphlet).  Therewith, the legislative intent regarding the right to fair distribution of marital property was to recognize the spousal contributions, such as doing household chores, raising children and others, made to maintain marital life.  Upon spousal death terminating the marital property relationship, the living spouse’s claim for the even distribution of the remaining property should be protected under the legislative purposes of the Estate and Gift Taxes Act and the claimed amount of surplus distribution should be excluded and deducted from the deceased’s property on which inheritance tax is to be levied. 

       In order to keep pace with changes in society and changing needs, new laws need to be designed, and current laws revised or abolished, to protect people’s acquired rights from being infringed.  To protect these rights, the legislators may allow discrepancies in maintaining current legal orders so as to meet legislative purposes.  However, in case of a special need to protect people’s interests of trust, the legislature is obliged to make a specific proviso to limit the application of a new law, for example, to make a transition clause to exclude or postpone the application of a new law in specified cases (See Judicial Interpretation No.577), or to adopt other remediable measures with reason, for example, to limit application of the new law only to some of the constituent facts that occurred after the enactment of the new law (See Article 84-2 of the Labor Standards Act added on December 27, 1996), though in such cases, the limit has to coincide with the constitutional principles of proportionality and equality.

       When the continuance of a legal relation governed by a new law covers both the periods of the new and the former laws, but the constituent fact occurs only after the enforcement of the new law, the new law shall be applied unless otherwise specified by law to make retroactive application or otherwise.  The judicial organs should abide by such principle.  Without proper legal authorization, a judicial organ cannot make retroactive application of a law, nor limit the application of a certain law to a specified period of time or make a transition clause to such effect.  On the other hand, if the legislature has failed to make a transition clause or to take other remediable measures so as to specify the application of the new law, thus constituting a loophole in the law, the judicial organ shall, based on the constitutional principles of trust, proportionality and equality, consider the possibility of closing the loophole with a reasonable transition clause within legal authority and in accordance with concerned jurisprudential rules.

       It is understood as a historical fact (See pp. 7-10, Vol. 74, of the Legislative Yuan Pamphlet) that Article 1030-1 was created only to include the phrase “the remaining marital property acquired after June 5, 1985”; nevertheless, a proper comprehension of legislative intention and legal wording involves a review of the objective purpose of the legislature and shall not be restricted to the subjective viewpoints of legislators at the time of legislation.  Under Article 1030-1, the distribution right is based on the marital property obtained during the “continuation of the marriage” and as such, it is not possible to exclude the property acquired before a certain time.  The judicial organ should elucidate the legislative intention or that of the law itself to and not be constrained by the subjective perspective of legislators.  Further, this Yuan should also evaluate whether the “legislative intention” as quoted above is in accordance with the constitutional protection of sexual/gender equality and the institution of marriage and family.

       Relevant questions as to whether the shared property regime should be applied to marriages constituted before the promulgation of Book IV: Relatives of the Civil Code or whether a living spouse may claim the right to property distribution in cases where the marriage was constituted after June 4, 1985, while the shared property regime was not instituted from the beginning of the marriage, and if so, how to calculate the amount of remaining marital property or whether inheritance tax may thus be deducted do not share the same legal base of this Interpretation, in which the main concern is for those whose marriages were constituted prior to June 4, 1985, and have continuously maintained the shared property regime.

       The Resolution made in the Joint Meeting of the Supreme Administrative Court on March 26, 2002 states, “Article 1030-1 of the amended Civil Code: Book IV: Relatives, which was promulgated on June 3, 1985, provides for the spousal right to claim equal distribution of the remainder of marital property.  Article 1 of The Enforcement Act of the Book of Relatives amended on the same day stipulates, “Unless otherwise regulated by the present Enforcement Act, the provision of the Book of Relatives does not apply to the family (relative) affairs that occurred before its coming into force; and unless otherwise regulated by the present Enforcement Act, the revised provisions shall not apply to that which occurred before the revision”.  Accordingly, the new law may not be applied retroactively.  If there is any need for retroactive application of the new law, it has to be specified in the Enforcement Act so as to maintain stability of the legal order and protection of acquired rights under the rule of law principle.  The Enforcement Act does not contain any retroactive provision to be applied to Article 1030-1 and thus Article 1 of the said Act shall apply.  On the other hand, Article 6-1 of the Enforcement Act, which was added on September 25, 1996, does not include the circumstances detailed in Article 1030-1.  Accordingly, for those who were married prior to June 4, 1985, and have continuously abided by the shared property regime agreement, upon the death of a spouse after June 5, 1985, when the surviving spouse claims the right to distribution, Article 1030-1 does not apply to the property acquired before June 4, 1985.  Hence, on the calculation of the deceased’s property, only the property acquired after June 5, 1985, may be counted as belonging to the remainder of the marital property and deducted from the deceased’s property for the purpose of taxation.

       The calculation basis and conditions of application for the right to distribution under Article 1030-1 are: "upon the termination of the relation of shared property, the remainder of the property acquired by the husband or wife within marriage".  The meaning of “within marriage” denotes by its wording the period of time starting from the inception of the marriage to its dissolution disregarding whether the marriage was constituted before June 4, or after June 5, 1985.  Thus it is not logical to assume from the provision that “the claim to distribute the remaining marital property only concerns the marital property acquired after June 5, 1985”.  As to Article 6-1 of the Enforcement Act, which was added on September 25, 1996, it is intended to clarify the ownership of marital property between spouses and is not concerned with the claim to distribute the remaining marital property.  Further, the legislative intention of Article 1030-1 is to realize the constitutional purpose of protecting sexual\gender equality and the institution of marriage and family.  The legislative intent was to recognize the spousal contributions, such as doing household chores, raising children and others, made to maintain marital life, which had not been included for consideration before.  Therefore, it would be contrary to the legislative purpose of upholding the constitutional principles if the marital property were divided into those items acquired before June 4, or after June 5, 1985.  In making the abovementioned Resolution, the Supreme Administrative Court not only failed to investigate the effect of the application of Article 1030-1 on the said constitutional purpose, but also did not elucidate why the marital property acquired before June 4, 1985, should be excluded from the legal claim.  It also failed to clarify why the spousal contribution to the management of household chores, raising of children and maintenance of marital life should be evaluated as lower than the acquired property right of the other spouse, and whether such evaluation is in accordance with the constitutional principles of proportionality and sexual\gender equality.  The legislature does not by law restrict the application of the new law and thus it should be applied to cases pertaining to general principles of law application.  In view of this, the Resolution not only violates the general principles of law application but also fails to comply with the legislative intention.  Even if including the marital property acquired before June 4, 1985, deprives the other spouse of a better economic position, paragraph 2 of Article 1030-1 may reduce the amount of claim if even distribution is obviously unfair.  If this should happen, the successors of the deceased spouse will be informed upon taxation (Administrative Order of the Ministry of Finance No. 871925704, January 22, 1998; Administrative Order of the Ministry of Finance No. 0940454540280, June 29, 2005).  The aggrieved party may then apply for relief accordingly and the property right of the spouse with better economic position will thus be equally protected under the Constitution balanced against the protection of sexual/gender quality and the institution of marriage and family, thus not violating the constitutional principles of trust, proportionality and equality.  It should especially be emphasized that in Judicial Interpretation No.410, this Yuan has declared that preferential treatment should be given to sexual\gender equality rather than people’s interests in the protection of personal property right.  Article 1030-1 is thus not made retroactive and the legislature has done its best to maintain the existing legal order.  The judicial organ confined itself to the formal wording of the law and failed to close the legal loopholes by making a transition clause to comply with the constitutional principles of sexual/gender equality and the preservation of the institution of marriage and family as the foundation of social formation and development (See Articles 7 and 156 of the Constitution; Article 10, Paragraph 6, of the Amendments to the Constitution; and Interpretation No.554 of the Judicial Yuan).

       By reducing the amount of deduction from the deceased’s property and thus increasing people’s obligation to pay tax without the authorization of law, the Resolution made in the Joint Meeting of the Supreme Administrative Court on March 26, 2002, exceeds the authority of legal interpretation and thus violates the constitutional principles of sexual/gender equality and the preservation of the institution of marriage and family as the foundation of social formation and development.  It is thus rendered null and void for violating the above principles and the “principle of taxation by law” principle governed under Article 19 of the Constitution.

       It should also be pointed out that the Administrative Order of the Ministry of Finance No. 871925704, January 22, 1998, was not the ordinance applied in the questioned final judgment and is thus not considered in this Interpretation.

*Translated by Professor Dr. Amy H.L. SHEE