Law Firm Gangnam (LLC) et al.

Attorney Hong Hong-soo

Attorney Han-soo et al., Counsel for defendant-appellant

Attorney Choi In-bok

The defendant shall pay to the plaintiff 180,000,000 won with 6% interest per annum from April 12, 2019 to December 23, 2020, and 12% interest per annum from the next day to the day of full payment.

2. The plaintiff's remaining appeal is dismissed.

3. Of the total litigation costs, 40% is borne by the Plaintiff, and the remainder is borne by the Defendant, respectively.

4. The part concerning the payment of money under paragraph (1) may be provisionally executed.

The reasons stated in this part are as follows, given that the reasoning of this Court is the same as the corresponding part of the reasoning of the judgment of the first instance except for partial deletion or dismissal as follows, it shall be accepted by the main sentence of Article 420 of the Civil Procedure Act.

Part 2 of the judgment of the court of first instance, "the penalty provision of this case" (hereinafter referred to as "the penalty provision of this case") shall be deleted.

The second and third pages of the judgment of the first instance court shall be affixed as follows.

Article 6 (Matters of Mutual Responsibilities and Cooperation) (1) The defendant is responsible for providing internal data and interview contents requested by the plaintiff in accordance with the deadline for verification and request. (2) The defendant is deemed to have a problem about the result of this contract and service services performed by the plaintiff.

(3) The plaintiff is not able to derive a management task that can completely offset the diagnostic service costs as a result of the diagnosis, or when the performance of the diagnosis service costs is insufficient in the course of the implementation project, the plaintiff shall return the shortage to the defendant for the shortage.Article 7 (Addition of Terms and Conditions of Contracts and Implementation Projects) (1) The plaintiff and the defendant are sufficiently aware that the project is conducted under the premise for the implementation of the diagnosis after the diagnosis, and prepare a written contract for the implementation project based on the results of the diagnosis project and jointly implement the implementation project. (2) If the implementation project is not carried out due to the internal circumstances of the defendant, the defendant shall pay the plaintiff an additional amount equivalent to four times the amount of the diagnosis service costs per additional costs in addition to the diagnosis service costs.

2. The parties' assertion

A. The plaintiff's assertion

The plaintiff and the defendant clearly confirmed the fact that the management diagnosis through the service contract of this case is the premise for the "project after the diagnosis", and concluded a contract for the implementation project based on the results of the diagnosis service and agreed to implement the project jointly. If the execution project agreed as above is not in progress due to the defendant's circumstances, the defendant immediately paid to the plaintiff KRW 300 million, which is four times the amount of the diagnosis service cost of KRW 75 million. However, the defendant did not enter into a contract for the project based on the above report, even if the diagnosis service under the service contract of this case was completed and the report of this case was submitted, until the time when a considerable period of time has elapsed since the report of this case was submitted.

Ultimately, the Defendant is obligated to pay a penalty of KRW 300 million and damages for delay to the Plaintiff in accordance with Article 7(2) of the instant service contract, since the Defendant did not perform its duty to conclude and implement the implementation project contract under the instant service contract due to the circumstances of the Defendant.

B. Defendant’s assertion

1) Under the interpretation of Article 7 of the instant service contract, a claim for penalty penalty can only be filed after the execution project contract is concluded. Unless a contract between the Plaintiff and the Defendant for an implementation project is concluded, the Plaintiff cannot seek payment of penalty against penalty against the Defendant.

2) Even if there is no domestic affairs, the implementation project is not carried out due to the following causes attributable to the plaintiff, and there is no reason attributable to the defendant, so the defendant does not bear the obligation to pay penalty for negligence.

A) The purpose of the instant service contract was to analyze the management of all the items purchased by the Defendant and to derive measures to reduce cost, etc. However, without the Defendant’s consent, the Plaintiff sought measures to reduce cost and derived the results of the diagnosis only for the items that correspond to approximately 43.7% of the total items purchased by the Defendant. The Plaintiff’s diagnosis results are limited to the items that are easy to discover substitution or substitute companies, and are not significantly different from the Defendant’s internal cost reduction measures. Items (Rbot, N2, etc.) that the Defendant intended to undergo the diagnosis through the instant service contract were excluded from the subject of the diagnosis without any attempt to reduce cost. The Plaintiff failed to fulfill its duty under the instant service contract, and derived insufficient diagnosis results, and the Defendant did not approve the aforementioned diagnosis results, such as demanding corrective measures.

B) In addition, the Plaintiff demanded that the Defendant enter into an agreement on the contingent fee rate that much more higher than the pre-existing contingent fee rate understood by both sides, and demanded that the amount of fixed remuneration be collected even if the period during which the implementation project is carried out increases.

3) Even if the cause attributable to the Defendant is recognized, the amount that the Defendant is to pay is deemed to have the nature of penalty, not a penalty, but a penalty, and it should be reduced unfairly because it is excessive to require the Defendant to pay the whole amount.

3. Determination

A. Interpretation of Article 7(2) of the instant service contract

1) In the event that a dispute over the interpretation of a contract between the parties arises and the interpretation of the intent of the parties expressed in the disposition document becomes an issue, the relevant parties shall be reasonably construed in accordance with logical and empirical rules by comprehensively taking into account the content of the text, motive and background of the agreement, the objective to be achieved by the agreement, the parties’ genuine intent, etc. (see, e.g., Supreme Court Decision 2016Da221429, May

2) In light of the above legal principles, the following circumstances recognized or known in full view of the overall purport of the arguments as seen earlier and the evidence revealed are deemed to include not only the case where the implementation project is not carried out due to the Defendant’s internal circumstances but also the case where the implementation project is not carried out due to the Defendant’s internal circumstances.

A) Article 7(1) of the instant service contract states, “The Plaintiff and the Defendant are fully aware of the fact that the instant diagnosis project is conducted on the premise of the implementation project after the diagnosis, and that the implementation project is conducted jointly based on the results of the diagnosis project.” In light of the language and text of the instant service contract, the intent of the Plaintiff and the Defendant to achieve the motive or the agreement under Article 7(2) of the instant service contract is to conclude an implementation project contract based on the results of the diagnosis project after the completion of the diagnosis project and to carry out the implementation project accordingly, and to impose the obligation on the Defendant to carry out the implementation project based on the results of the diagnosis project, and to compensate the Plaintiff for the damages agreed upon if the Defendant violated such obligation.

B) If it is interpreted that the Plaintiff may file a claim under Article 7(2) of the instant service contract after the conclusion of the implementation project contract as alleged by the Defendant, the Defendant may be exempted from liability under Article 7(2) of the instant service contract by avoiding or refusing the conclusion of the implementation project contract. This seems to be extremely unreasonable to disregard the purport of Article 7(1) of the instant service contract.

3) Therefore, when the execution project contract is not concluded due to the Defendant’s internal circumstances or the implementation project is not carried out, the Defendant shall pay the Plaintiff damages under Article 7(2) of the instant service contract.

B. Whether the Defendant is liable under Article 7(2) of the instant service contract or not is liable to the Defendant under Article 7(2) of the instant service contract shall be deemed to be “the circumstances attributable to the Defendant, i.e., the reason attributable to the Defendant, in light of the content of the language and text.” In light of the following circumstances, it is reasonable to view that the Defendant was liable to the Defendant for damages under Article 7(2) of the instant service contract, based on the evidence and the overall purport of the pleadings as indicated in the evidence and evidence Nos. 8 through 14, and evidence Nos. 2, 4, 7, and 10 (including the serial number) and the overall purport of the pleadings, it was recognized or known, and it is reasonable to view that the implementation project was not concluded due to the Defendant’s cause attributable to the cause attributable to the Defendant,

1) On August 27, 2018, the Defendant received the instant report, which is a diagnosis result under the instant service contract, from the Plaintiff, and paid all remainder of service costs under the instant service contract to the Plaintiff on September 5, 2018 without any specific objection.

2) Considering the structure, content, quantity, etc. of the instant report (Evidence B No. 1), the Defendant appears to have been able to fully grasp the important contents of the instant report after receiving the instant report and before paying the balance of service costs. Accordingly, the Defendant requested the Defendant to pay the balance on August 31, 2018 on the ground that the Plaintiff would have paid the balance of service costs on the ground that employee position bonus was paid. The Defendant asserted that the Defendant reserved the approval without sufficient time to sufficiently examine the diagnosis result and paid the balance. However, there is no evidence to acknowledge this.

3) Article 6(2) of the instant service contract states that “the Defendant shall prepare a written request to the Plaintiff for corrective measures and comply with such request if it is deemed that there is a problem with the Plaintiff’s implementation of the project.” There is no evidence to deem that the Defendant, after the receipt of the instant report, requested in writing the Plaintiff to take corrective measures with respect to the instant report, which is the outcome of the diagnosis contract. The Defendant appears to have requested the Plaintiff to take corrective measures with the e-mail (Evidence B) dated November 2, 2018 and the e-mail (Evidence A) dated November 27, 2018, which appears to be the implementation of the project. However, it is reasonable to view that the e-mail (Evidence B) of the instant service contract was not prepared and sent to the Plaintiff on November 2, 2018 as the implementation result of the project’s implementation of the project, and it is reasonable to view that each of the above e-mail products that the Plaintiff wishes to review the project’s implementation of the project.

5) Items excluded from the examination of the instant report are items that are difficult to gather information such as ① Robot and N2, ② items designated by the customer company that supplies the Defendant’s product, ③ disposable items consumed only in the pertinent year, ④ items that have already been procured through the purchasing company C, ⑤ items that are limited to other purchases or are at issue of market competitiveness. This seems to be items that cannot reduce cost or difficult to reduce due to future replacement items, physical color of the new trading company, and reduction of supply price of the existing transaction party. Furthermore, the performance remuneration for the implementation project is expected to be paid in proportion to the cost reduction amount, and it appears that there is no particular reason to exclude the Plaintiff from the diagnosis object voluntarily, in light of the fact that the Plaintiff’s exclusion of possible items from the diagnosis object is contrary to the Plaintiff’s interest.

6) According to Article 6(1) of the instant service contract, the Defendant is responsible for providing internal data, etc. requested by the Plaintiff. The Plaintiff appears to have not been provided with data necessary for the diagnosis of items excluded from the said diagnosis, such as market research, etc., by the Defendant. The Plaintiff appears to have been notified to the Defendant that it is difficult to conduct diagnosis of the said items because there is no data necessary for conducting diagnosis through marting between the Plaintiff and the Defendant. The Defendant seems to have been well aware of the above circumstances.

7) The Defendant asserted that the instant implementation project was not carried out due to unreasonable demand for the implementation project period or the contingent fee rate, but there is no evidence to acknowledge it, and rather, it stated that the Plaintiff would accept the contingent fee rate under the conditions presented by the Defendant.

C. Scope of damages

1) Legal nature of Article 7(2) of the instant service contract

A) As penalty is presumed as liquidated damages under Article 398(4) of the Civil Act, in order to be interpreted as penalty for breach of contract, special circumstances should be asserted and proved. In addition to the name or phrase used in relation to penalty at the time of concluding the contract, the economic status of the contracting party, details and contents of the contract, details and negotiation process of the agreement for penalty, the principal purpose of the agreement for penalty, the nature of the obligation to guarantee performance through penalty, whether damages can be separately claimed in addition to penalty in the event of nonperformance of obligation, the amount of penalty, size of the penalty amount or the total amount of the obligation, the amount of damages anticipated to occur due to nonperformance of obligation, and the amount of damages expected to occur due to the nonperformance of obligation at the time of the contract, the legal nature of penalty should be reasonably determined (see, e.g., Supreme Court Decision 2012Da65973, July 14, 2016)

B) As seen earlier, Article 7(2) of the instant service contract is using the phrase “a penalty” under Article 7(2) of the said contract. However, in light of the aforementioned legal principles, it is reasonable to view Article 7(2) of the instant service contract as liquidated damages in light of the following circumstances: (a) the instant service contract does not separately provide for damages in preparation for the case where the Defendant did not undertake the implementation project; (b) the instant service contract forced the progress of the implementation project; and (c) the instant service contract appears to be aimed at clarifying the issue of compensation; and (c) there is no special circumstance to interpret the foregoing provision as a penalty.

2) The court may reasonably reduce the estimated amount of compensation for damages where the estimated amount of compensation for damages is unreasonably excessive (Article 398(2) of the Civil Act). The following circumstances, which can be acknowledged by comprehensively taking account of the purport of the entire arguments in the evidence as seen earlier, i.e., ① the Plaintiff’s diagnostic project was conducted for the Defendant’s purchase price of KRW 121.87 billion in 2017, and the Plaintiff selected the amount of KRW 53.94 billion among them as an item subject to diagnosis. The amount anticipated to be saved in the implementation of the project was KRW 4.2 billion (minimum KRW 2.76 billion, maximum KRW 6.7 billion, and KRW 6.0 billion). The Defendant’s purchase plan was established at KRW 6.1 billion in the implementation of the project, which was 7 billion in advance, according to the aggravation of the semiconductor market of the global aggregate market, and the amount expected to have been significantly worse than the Plaintiff’s initially determined in the implementation of the project.

D. Sub-determination

Therefore, the Defendant is obligated to pay the Plaintiff damages amounting to KRW 180,00,000 as damages and the damages for delay calculated at the rate of 12% per annum under the Commercial Act from April 12, 2019, which is the date following the date of service of a copy of the complaint of this case, which is the date of the request for performance, to December 23, 2020, which is deemed reasonable for the Defendant to dispute over the existence of the obligation and the scope of the obligation.

4. Conclusion

Thus, the plaintiff's claim shall be accepted within the scope of the above recognition, and the remainder of the claim shall be dismissed as it is without merit. Since part of the part against the plaintiff in the judgment of the court of first instance which differs from this conclusion is unfair, the plaintiff's appeal shall be partially accepted and the defendant shall be revoked, and the payment of the money recognized as above shall be ordered. The remaining part of the judgment of the court of first instance is justified, and the plaintiff's remaining appeal

Judges fixed-ranking

Judge Choi Jong-Un