Criminal Complaint or Civil Claim: Which Should You Pursue First? [Everyday Life Turned into a Case, by Attorney Won Hee-young]

[Financial News]“Couldn’t I file a complaint first and collect the money after the criminal case is over?”For victims preparing to file a criminal complaint, obtaining at least monetary compensation for their losses is as important as having the other party punished. Yet it can seem that compensation will be much easier to obtain if guilt is established in a criminal case. It is burdensome to pay for a civil lawsuit as well. Should I just start with a criminal complaint?
If the crime is clear and there is no urgent issue involving a limitation period or the disposal of assets, it is more efficient to begin with a criminal complaint. By contrast, even if it is uncertain whether a crime was committed, it is better to pursue both proceedings if there are civil grounds for seeking damages or repayment.
If a guilty verdict for a crime that caused harm to the victim becomes final, the offender will generally also be liable to compensate the victim for that harm.
In a civil lawsuit, the victim generally has to prove that the other party committed an unlawful act intentionally or negligently, that damage occurred, and that there was a causal link between the act and the damage. For example, if an assault victim seeks reimbursement for medical expenses and losses from time off work, they would use medical records and receipts to prove the injury and treatment costs, and calculate lost income using pay slips or income tax records.
A final guilty verdict is strong evidence that the wrongful act occurred.A civil court is not required to follow a criminal judgment, but the courts take the view that, absent special circumstances, it is difficult to find facts contrary to those established in that judgment.To establish liability for damages in a civil case, the victim must first prove that a wrongful act occurred. But if a guilty verdict has already become final, the burden of proving from scratch that the crime occurred is greatly reduced. The victim can focus more on proving the extent of the damage and the amount of compensation owed.
Evidence obtained during an investigation can also be used in a civil lawsuit.
If footage captures an assault or records show that entrusted money was diverted without authorization, the case has physical evidence supporting the commission of a crime. Investigative authorities question people involved and review account transactions and other records to establish how the offense was carried out. In the process, additional harm that the victim did not know about may also come to light.
In embezzlement cases, the victim’s representative explains to investigators which transactions have already been confirmed and which require further examination. Financial transaction records and other material obtained by investigative authorities are also submitted as evidence in the civil lawsuit, to the extent that access and copying are permitted. Since the authorities can obtain records that would have been difficult for the victim to get alone, it becomes much easier to prove the extent of the loss.

Fraud is a prime example. Even if fraud is not established, borrowed money still has to be repaid.
The key issue in a fraud case is whether the borrower deceived the other party when borrowing the money. If the borrower intended and was able to repay the money at the time, and did not deceive the lender during the borrowing process, simply being unable to repay later does not constitute fraud.
Even so, the obligation to repay the borrowed money remains. In a claim for repayment of a loan, the relevant issues include whether the money was lent and when it was due to be repaid. There is no need to prove that the borrower never intended to repay it in the first place.
If a decision not to refer a case for prosecution or a written statement of reasons for non-prosecution says that the borrowing was confirmed but was difficult to regard as fraud, that document can also be used as evidence in a claim for repayment of a loan. Although the investigative authorities’ conclusions do not bind a civil court, the borrower’s statements acknowledging the loan or financial transaction records obtained during the investigation can support the victim’s claim.
When repayment can be sought under a contract, as in these cases, there is considerable practical benefit to pursuing a fraud complaint alongside a civil lawsuit. If there is no contractual basis for a claim and the case seeks damages only for a wrongful act, the victim must prove the wrongful act and the resulting damage in the civil proceedings as well.
Even if criminal punishment is not possible, civil liability for damages may still be established. As a rule, criminal law punishes intentional offenses, and negligent offenses are punishable only when a separate provision provides for it. Civil law, by contrast, recognizes liability for damages not only when harm is caused intentionally but also when it is caused through negligence.
Damage to property is a typical example. Criminal law has no provision punishing the negligent damage of another person’s property. If someone damages an item without intent, they cannot be punished for the crime of property damage, but they may still be liable for civil damages if they damaged someone else’s property through carelessness.

Starting both proceedings at the same time does not mean they will move forward in parallel. A civil court may defer setting the next hearing date while it waits for the outcome of the criminal case, while investigative authorities may ask the parties to bring them the civil judgment. If each side waits for the other’s conclusion, the parties may get no answer from either one.
This is also the most frustrating situation for a legal representative. If the same representative handles both proceedings, it is easier to keep track of their progress and the reasons for delays. On that basis, the representative can identify the issues that can be decided first and the evidence needed in each proceeding, and press for them to move forward promptly.
Investigative authorities should be told that the civil proceedings are waiting for the outcome of the criminal case, and asked to investigate and make a decision promptly. The representative should explain specifically what the other party said when borrowing the money, and whom investigators should question and what records they should obtain to verify it. If a civil judgment is being awaited to verify a particular fact, other material that can establish that fact may be submitted to urge the investigation forward.

As a rule, the limitation period for a damages claim arising from a wrongful act is three years from the date the victim learns of the damage and the person responsible, and 10 years from the date the damage actually occurred. The limitation period does not begin only when a criminal judgment is issued.
Filing a criminal complaint alone does not interrupt the civil statute of limitations. The courts have also ruled that filing a complaint or the start of a criminal trial, by itself, does not constitute a judicial claim that interrupts the limitation period. If the limitation period expires while the victim waits for the criminal case to conclude and the other party’s statute-of-limitations defense is accepted, the civil claim may be dismissed.
Delay damages are another factor that should not be overlooked when deciding when to sue. As a rule, a claim for damages arising from a wrongful act comes into being when the damage occurs, and delay damages accrue from that point.
If the claim is granted in full, an annual rate of 12% generally applies from the day after a copy of the complaint is served on the other party. Even if only part of the claim is granted, delay damages at an annual rate of 12% on the amount awarded typically accrue from the day after the judgment is pronounced.
How often do you see a claim bearing “usurious” interest of 12% a year these days? If you have grounds and evidence to support your claim, you should pursue it as soon as possible.

The author says that if you win a civil lawsuit but fail to collect the money, you have done no more than become an “honorable creditor.”
If the other party does not pay the amount ordered in the judgment, the remaining options include attaching their bank deposits and collecting the funds, or applying for a forced auction of their real estate. These steps take more time and money, and even enforcement proceedings may not recover the compensation if the other party has no assets to seize or nothing remains after higher-priority creditors are paid.
If receiving the money is the top priority, reaching a settlement during the criminal proceedings and receiving a lump sum can also be a good option. People who fear detention or a prison sentence and are seeking leniency often make an active effort to settle with the victim. When their freedom is at stake, people are naturally more inclined to give in. Receiving a settlement payment when the other party is seeking leniency may be the most practical way to recover the loss.[About the author] Attorney Won Hee-young is a former reporter for Financial News and currently handles criminal cases at YK Law Firm. She graduated from Ewha Womans University and earned a master’s degree in Media and Communications from Seoul National University Graduate School. She also graduated from Ewha Womans University Law School. She examines how ordinary life can turn into a legal dispute and explains the key issues that shape the outcome of a case, along with practical ways to respond.[email protected] Lee Hwan-joo Reporter