2. All costs of the lawsuit shall be borne by the Plaintiff.

The defendant shall pay to the plaintiff 905,225,00 won and 182,40,000 won among them, from July 20, 2017, from July 31, 2017, from July 31, 2017, from July 8, 2017, from July 25, 2018, from July 25, 2018 to the delivery date of a copy of the claim and the application for modification of cause of each of the above cases, 5% per annum from the next day to the full payment date (the plaintiff changed the purport of the claim to the court in exchange).

2. Purport of appeal

The judgment of the first instance is revoked. The plaintiff's claim is dismissed.

(a) Conclusion of an agreement on the operation of the facility for the recovery of resources in Yangsan City;

1) On October 25, 2013, the Defendant publicly announced a bid for the entrusted management service of the instant facilities to select a private business entity to whom the operation, maintenance, and management of the resource recovery facilities and ancillary facilities (hereinafter “instant facilities”) are entrusted in Yangsan-si ( Address omitted).

As a result of these bids, a joint supply and demand organization (hereinafter referred to as “Plaintiff, etc.”) composed of four companies (hereinafter referred to as “KM”) of the Plaintiff, Inc. (hereinafter referred to as “Environmental Management”), BlubM (hereinafter referred to as “Blu”) and the KP Co., Ltd. (hereinafter referred to as “KP”) was selected as a successful bidder.

2) Accordingly, joint contractors of the Plaintiff, etc. and the Defendant entered into an agreement on the consignment operation of the instant facilities (hereinafter referred to as the “instant agreement”), and the main contents are as shown in the attached Form.

3) Under the instant agreement, the Defendant requested a specialized service company to calculate the cost of annual entrusted operation each year, and entered into a technical service standard agreement with the Plaintiff, etc. on the contract amount based on the results of the said calculation.

B. Occurrence of the instant dispute

1) As a result of conducting an audit of the affairs entrusted to the private sector in 2016 on the instant agreement, the Defendant decided to recover KRW 912,00,000, which was not executed among the amounts that the Plaintiff received from the Defendant as non-settlement expenses, such as labor costs and welfare expenses, in accordance with the instant agreement (hereinafter “non-execution amount”).

Accordingly, on February 3, 2017, the Yangsan City: (a) decided that it is not reasonable to take labor expenses and welfare expenses to be executed to employees as additional profits of an enterprise; (b) thus, (c) paid the amount of non-execution of the instant case by April 3, 2017 (hereinafter “the notice of recovery”) to the Plaintiff.

2) As to the instant notice of recovery, the Plaintiff et al. paid KRW 84,425,00,00 each on July 25, 2018, in accordance with the equity ratio (5:2:2:1) stipulated in the Framework Agreement on the Management of Joint Supply and Demand Enterprises (5:2:2:1); the Plaintiff paid KRW 456,00,000 on July 31, 2017; and the Environment Management KRW 182,40,000 on July 31, 2017; and the case contact paid KRW 91,20,000 on July 25, 2018, with the payment of KRW 84,425,000 by installments of KRW 91,20,000.

C. Progress of the instant lawsuit

1) On April 4, 2017, the Plaintiff filed an appeal suit against the Ulsan District Court Decision 2017Guhap5717, which primarily sought confirmation of invalidity of the instant recall notification and revocation of the instant recall notification. On October 26, 2017, the first instance judgment, which dismissed the Plaintiff’s primary claim and accepted the conjunctive claim, was pronounced.

2) On June 29, 2017, the Plaintiff filed a motion for modification to the purport that the instant dispute ought to be resolved not by an appeal suit but by a party suit or civil lawsuit, while filing an appeal suit. On June 29, 2017, the instant notice of recovery was not an administrative disposition that is the object of an appeal suit, and thus, the Defendant filed a petition for modification to the purport that

3) As to the Plaintiff’s application for modification of lawsuit, the Defendant also presented his opinion on the motion, and this Court permitted the application for modification on August 7, 2018.

[Ground of recognition] Facts without dispute, Gap evidence 1 through 9, 14 through 19, Eul evidence 5 (including each number, if any; hereinafter the same shall apply) and the purport of whole pleadings

2. The assertion and judgment

A. The parties' assertion

1) The plaintiff's assertion

The plaintiff asserts that the notification of this case was made voluntarily without any grounds in the agreement of this case, and that the total amount of KRW 905,225,000 paid by the plaintiff et al. to the defendant should be returned to unjust enrichment because it was paid without any legal grounds. The plaintiff asserts that the plaintiff can claim payment of the total amount as the representative of the other joint contractors.

2) The defendant's assertion

In regard to this, the Defendant’s acquisition of KRW 912,00,000, which was not executed by the Plaintiff from 2014 to 2016, based on the profits of labor cost and welfare cost, violates Article 7(2) of the instant Convention that “the Plaintiff shall not use the operating cost for any purpose other than its original purpose.” As such, the Defendant’s acquisition of KRW 905,225,00,00, out of the above amount, shall not be unjust enrichment.

B. Determination as to the nature of the instant lawsuit

First, we examine the nature of the changed litigation of this case.

Where the so-called “public contract” in which a local government becomes a party to a private economy falls under a private contract concluded on an equal basis with the other party as the subject of the private economy, the principle of private law, such as the principle of private autonomy and freedom of contract, applies as it is, except as otherwise expressly provided for in statutes (see, e.g., Supreme Court Order 2012Ma1097, Sept. 20, 2012; Supreme Court Decision 2014Du11328, Feb. 13, 2018).

A claim for the return of money already paid on the premise that an administrative disposition is void as a matter of course must follow the civil procedure as a claim for return of unjust enrichment under civil law (see Supreme Court Decision 94Da55019 delivered on April 28, 1995, etc.).

The Defendant agreed to entrust the management of the instant facilities to the Plaintiff, etc., and accordingly, the instant agreement concluded with the Plaintiff, etc. constitutes a delegation contract under the Civil Act (see Supreme Court Decision 2015Da205796, Jan. 25, 2017).

In light of the above legal principles, the plaintiff in this case sought the return of unjust enrichment against the defendant on the premise that the notice of recovery in this case is null and void since there is no basis for the agreement in this case. Thus, the lawsuit in this case is considered to have the character of civil procedure.

C. Determination as to whether the right to claim restitution of unjust enrichment is recognized

1) Facts of recognition

The following facts are recognized by the parties to a dispute or by comprehensively taking account of the overall purport of the pleadings in each of the evidence Nos. 9, No. 2, and No. 4.

(1) Article 12 (1) of the Ordinance on Promotion and Management of Entrustment of Administrative Affairs to the Private Sector (Audit of Management Status) provides that "the head of a Si shall audit the results of handling administrative affairs to the private sector at least once a year," and Article 12 (2) of the same Ordinance provides that "the head of a Si shall take appropriate measures against the entrusted institution when the audit results under the provisions of paragraph (1) indicate that "if the handling of administrative affairs to the private sector is illegal or unjust or violates

On August 17, 2016, the Yangsan City audited the Plaintiff pursuant to the above Ordinance and Article 24 (Guidance and Supervision) of the Convention, and confirmed that labor expenses and welfare expenses were executed less than KRW 912,00,000 than the calculation sheet at the time of the contract, and notified the recovery of the amount of non-execution.

② According to the Ministry of Environment’s calculation guidelines for operating expenses for incineration facilities of domestic wastes (hereinafter referred to as “the Ministry of Environment calculation guidelines”), operating expenses shall be as follows:

In the table classification in the main sentence, expenses for daily personnel expenses for personnel expenses directly for personnel expenses for personnel expenses, welfare expenses, education and training expenses for insurance premiums, travel expenses, travel expenses, travel expenses, expenses for office supplies, communication expenses, travel expenses and other expenses for public relations expenses for postal expenses, expenses for operation of facilities and equipment, expenses for regular maintenance and repair of facilities and equipment, expenses for the measurement of expenses for water treatment expenses for electricity fuel expenses, expenses for expenses for water treatment of medicine, inspection fees, other expenses for expenses for expenses for general management of taxes and profits, value added tax, and other tax-free incentives for utilization of waste heat.

(3) The main contents of the cost of calculating the cost of operating and managing the private entrustment of the resource recovery facilities, 2013 (Evidence A No. 9) are as follows:

The concept of the cost of settlement and settlement (see Evidence A No. 9 and No. 17)

The ○○ Non-Adjustment Cost included in the main sentence refers to the sum of personnel expenses, insurance premiums, welfare expenses, safety management expenses, education and training expenses, domestic shipping equipment, mail expenses, consumption expenses, general management expenses, profits, and value-added taxes for the necessary personnel while operating a resource recovery facility, and the annual total amount is the cost paid every month under a contract between the truster and the trustee, and most cases of high-maintenance nature, regardless of the operation of the resource recovery facility and the recycling screening facility. The settlement cost refers to the cost required for the actual operation of the resource recovery facility, and refers to the cost required for the project implemented at the request of the truster, such as the cost of equipment maintenance, electricity cost, fuel cost, water supply cost, medicine cost, reprocessing cost, measurement and inspection fee, etc.

(C) Standard for calculating personnel expenses among the non-settlement expenses;

With respect to ○○ personnel expenses included in the main text, an appropriate operating number necessary for a resource recovery facility and a recycling boat, and calculated the number of members according to the conditions, such as the capacity of each facility, the number of installation periods, the conditions of driving conditions, etc. The standards for personnel expenses were calculated based on the unit engineering wage (construction and any other) and the ratings and qualification standards for technicians were calculated by comparing the current number of employees with the level of technology and the wage level. In this case, the unit wage for technicians for engineering by grade shall include basic wages, allowances, bonuses, allowances for severance and retirement benefits, the industrial accident compensation insurance expenses borne by the company, etc., the Korea Engineering Promotion Association shall be added to the daily average personnel expenses according to the Statistics Act, as the basis for the cost of the engineering project in 2012, and the monthly average personnel expenses shall be calculated by up to 8 hours a day, 25 days a day, calculated based on individual capacity, career, qualifications, and other conditions, and the amount of individual personnel expenses may be adjusted within 801-20% of the individual personnel expenses.

standards for calculation of welfare expenses out of the non-settlement expenses for a loss caused by a disaster;

In order to improve the working conditions of attached ○ employees included in the main sentence, personnel expenses, including health insurance, national pension, employment insurance, employment insurance, industrial accident insurance premiums, clothes, school subsidies, school expenses, work allowances in a suspected facility, leave expenses, food expenses, safety management expenses, transportation subsidies, etc. shall be determined within the scope of 20 to 30% of the personnel expenses.

Standard for calculating other expenses

The attached general management expenses included in the main text include 5% of the total amount of material cost, labor cost, and expenses according to the standards for preparation of the estimated price. The ○ profit included 10% of the total amount of labor cost, expenses, and general management expenses by applying the added-value method according to the standards for preparation of the estimated price. The ○ value-added tax included 10% of the total amount of cost.

④ On the other hand, the Ministry of Environment responded to the following questions as to whether it is possible to recover high-quality maintenance out of the operating expenses of the resource recovery facilities.

The guideline for calculating operating expenses for the incineration facility in the main text is to prevent excessive competition among the entrusted operators of the incineration facility and to operate the incineration facility in an efficient and stable manner through the payment of adequate operating expenses, and the content of the contract between the parties to the contract should first be applied. The labor cost and management expenses are classified as fixed expenses not requiring settlement because they are premised on the fact that the employees according to the calculation basis work and the personnel expenses are actually paid on the basis of the above and entrustment contract and are under the premise that the personnel expenses are actually paid on the basis of the calculation. The labor cost and management expenses for the 00 personnel expense and welfare expenses are classified as fixed expenses not requiring settlement because the balance of the execution of the labor expenses, etc. is determined within 10% of the expenses added to fixed expenses and general management expenses (excluding taxes and public charges) so it is difficult for the entrusted company to additionally take the balance of the execution of the labor expenses, etc., so it is difficult for the entrusted company to confirm whether the contract violates the contract or to have the adequate number of employees and the level of human resources through the modification

2) Determination

A) In light of the following circumstances revealed in light of the purport of the entire arguments in the facts acknowledged earlier, it cannot be deemed that the Defendant’s unjust enrichment without any legal ground, which the Plaintiff received from the Plaintiff, etc.

① Article 2 subparag. 6 of the instant Convention defines “non-settlementing expenses” as expenses that include personnel expenses, management expenses, incidental expenses, value-added tax, etc., and that are not settled according to the Ministry of Environment calculation guidelines and agreements. However, according to the large classification set out in the Ministry of Environment’s calculation guidelines, labor expenses and welfare expenses are separately organized with high-quality maintenance, profit, and other expenses. As can be seen, the inclusion of labor expenses, etc. in the items of non-settlementing expenses is determined with an appropriate number of persons meeting the specific conditions of resource recovery facilities, and the calculation of labor expenses is determined with an accurate amount through the process of applying each allowance to the reasonable unit price after determining the adequate number of persons meeting the specific conditions of resource recovery facilities, and the labor expenses that are reasonably calculated is expected to be spent as a matter of course regardless of whether resources recovery facilities are operated.

Therefore, it is likely that the non-execution amount of personnel expenses and welfare expenses has not been calculated appropriately or due to the failure to employ adequate personnel or adequate quality personnel meeting the specific conditions of the resource recovery facility. This is the following: (2) Although the Convention has been formulated in place, the method of handling non-execution expenses as referred to in paragraph (1) is insufficient, if the Plaintiff allows the non-execution amount to be held properly, then the Plaintiff would try to increase profits by increasing the non-payment expenses under the pretext of cost reduction, and ultimately, it would not be ruled out that the risk would result in preventing excessive competition and resulting in the failure to achieve the initial intent to operate the facility of this case in an efficient and stable manner.

As such, it seems inappropriate in light of the content of the instant agreement to allow the Plaintiff to hold non-execution amount, such as personnel expenses, and to include non-execution amount in profits equivalent to other expenses, such as personnel expenses, etc.

② The Plaintiff asserts to the effect that the part concerning the settlement of accounts in the instant agreement constitutes a final contract under which the amount was determined at the time of concluding a contract following changes in the expenses for entrusted operation and thus, it cannot be settled ex post facto.

Article 12 (Settlement of Entrusted Operation Expenses) of the Convention includes only the settlement expenses (Article 2 subparagraph 7 of the Convention) excluding the settlement expenses. It seems reasonable in light of the language and text.

However, in light of the purport of the provisions of the Convention as seen below, it is determined that the non-settlement cost cannot be changed only once, or that the amount of non-execution can not be determined to be reverted to the Plaintiff on the condition that it would be reverted to the Plaintiff on the condition that the amount of non-execution would be attributed to the Plaintiff.

Article 9(3) of the Convention stipulates that “In the event of mutual consultation due to any other change, etc., the contract amount may be changed”. However, Article 9(1) and (2) of the Convention provides for the division of the settlement cost and the settlement cost, but only provides that both of the two expenses are included in the consignment operation cost, and no mention exists that any of the expenses of the item is excluded from the scope of application under Article 9(3).

(b) In addition, according to Article 10(1) and (3) of the instant Convention, the Plaintiff shall obtain the approval of the Defendant for the annual execution contract, prepare an enforcement plan by which the expenses for settlement of accounts and settlement of accounts are divided into the budget required each quarter, and submit it to the Defendant by no later than 15 days before the beginning of the quarter. Furthermore, pursuant to Article 10(5) of the instant Convention, if the amount indicated in the execution plan is not mechanically paid but the Plaintiff paid for saving operating expenses, only the remainder after deducting the remainder

In other words, if some of the personnel expenses, etc. were not executed differently from the original execution plan, the defendant would only pay the balance calculated by deducting the unexecution amount from the estimated payment amount of the following month. Thus, it cannot be deemed that the total amount of the non-settlement expenses originally planned is unconditional, as alleged by the plaintiff.

In order to ensure the effectiveness of the defendant's measures for the modification of such contract amount (Article 9 (3) of the Convention) and the adjustment of operating expenses paid every month (Article 10 (5) of the Convention), Article 18 of the Convention (Article 18 of the Convention) provides that if the defendant's request or the defendant is deemed necessary to report matters, the plaintiff may make an occasional report (Article 18 (1) of the Convention), and if he neglects or refuses to report such matters, he/she may make a request for disciplinary action against the relevant employee (Article 24 (Guidance and Supervision) of the Convention. Article 24 (Guidance and Supervision) of the Convention provides that the defendant may investigate or request books and other documents concerning the current status of operation of the resource recovery facility, and the plaintiff shall comply with

Therefore, the Plaintiff’s assertion that the portion of the non-settlement cost is fixed and conclusive and reverted to the Plaintiff cannot be accepted.

③ The Plaintiff also asserts that the failure to execute part of personnel expenses and welfare expenses cannot be deemed as “use for purposes other than the original purpose” under Article 7(2) of the Convention.

However, as seen earlier, personnel expenses, etc. fall under an item of non-settlementing expenses, which must be paid naturally on the premise that an adequate number of persons meeting the specific conditions of the resource recovery facility works, and thus, it is determined that the failure to execute the expenses falls under the category of "profit," which is one of the items of "other expenses," by holding the non-execution amount as it is by the Plaintiff.

Therefore, the plaintiff's above assertion is without merit.

④ The Plaintiff asserts that the difference between the contract amount and the actual execution amount ought to be taken into account in the nature of labor cost and welfare cost (see, e.g., Supreme Court Decision 201Da1148, Aug. 8, 2017).

In order to solve the problem as alleged by the Plaintiff, Articles 9(3) and 10(5) of the Convention (Adjustment of Operating Expenses to be paid every month) are deemed to be prescribed.

Therefore, the above argument to the effect that in reality, in the case of non-settlement of expenses, the unexecution amount is inevitable, and this should be attributed to the plaintiff cannot be accepted.

⑤ Meanwhile, the Plaintiff asserts to the effect that the calculation basis of the recovery amount of KRW 912,00,000 asserted by the Defendant is unclear. However, the Defendant requested the Plaintiff to submit specific details of use during the process of improvement, but it seems that the Defendant calculated the recovery amount based on the insurance benefits, etc., such as the National Pension, etc., as the Plaintiff did not comply

In addition, if the amount actually used as personnel expenses, etc. among the non-execution amount of the instant case, the Plaintiff is able to submit the details and related data difficult, but no explanation or data is presented.

Therefore, the plaintiff's assertion on this part is without merit.

B) Therefore, the Plaintiff’s assertion that part of the non-execution amount of this case, which the Defendant received from the Plaintiff, should be returned to the Plaintiff with unjust enrichment is without merit.

3. Conclusion

Therefore, the plaintiff's claim of this case that was changed in exchange in this court is dismissed on the ground that it is without merit (the plaintiff's claim for confirmation of invalidity, etc. of notification of collection of non-execution amount, which is the previous lawsuit, was withdrawn by the exchange change of the claim made in this court, and thus the judgment of the first instance was invalidated)

[Attachment]

Judges Park Jong-hun (Presiding Judge)

Note 1) At the time of the conclusion of the instant agreement, “Columbb Energy Co., Ltd.” but on August 5, 2016, the trade name was changed to “Environmental Management Co., Ltd.”.