A. The so-called “production supply contract,” under which one of the parties to the relevant legal doctrine agrees to supply goods made of his/her own materials according to the other party’s order and the other party agrees to pay the price for the manufacture, has the nature of a contract and trade and the nature of a contract as a substitute in terms of sale and supply. As such, the relevant law applies to a case where an article to be manufactured and supplied under a contract is a substitute, but if an article is an accessory to meet the demand of a specific client, the provision of the article in question and the manufacture are made for the purpose of a contract.

In principle, the contractor shall pay remuneration to the contractor simultaneously with the delivery of the completed object, unless there is a special agreement or custom between the parties on the time of payment of remuneration in the production supply contract.

(See Supreme Court Decision 2004Da21862 Decided October 13, 2006, etc.). In general, where the last process scheduled under the relevant contract is terminated and the main part is completed, it shall be deemed that the object is completed, barring special circumstances, and it shall be dealt with in accordance with the provisions of the Civil Act concerning warranty liability, such as a defect of the object or the remaining finishing part of the object, in accordance with the intent of the parties and the purport of the law. Whether the last process scheduled in this case has been completed should be objectively determined in light of the specific contents of the relevant contract and the principle of trust and good faith, regardless of the parties’ assertion.

(See Supreme Court Decision 2004Da29217 delivered on September 23, 2004, etc.). B.

Facts of recognition

The following facts are not disputed between the parties, or described in Gap 1 through 16 (including each number), Eul 3 and 4.