2015du42312 Disposition of revocation of disqualification

Seoul Elevator Corporation

Seoul Metropolitan Government Urban Railroad Corporation

Seoul High Court Decision 2014Nu69282 Decided April 24, 2015

March 24, 2016

The judgment below is reversed and the case is remanded to Seoul High Court.

The grounds of appeal are examined.

1. According to the reasoning of the first instance judgment cited by the lower court, the lower court found the following facts as indicated in its reasoning, i.e., the Defendant appears to have failed to recognize that fixed cameras were installed in the instant elevator, rather than the size stipulated in the instant elevator contract. Furthermore, it is difficult to view the Defendant’s installation of fixed cameras to the Plaintiff or consented to the installation of the above elevator. Furthermore, it appears that the Plaintiff would have installed the above elevator without sufficiently verifying the size of CCTVs supplied by the Plaintiff, unlike the shop design, at the time of installation of the instant elevator, in light of the fact that the Plaintiff would not have seen that the CCTV would have been installed in the instant elevator with the Defendant at the time of installation of the instant elevator, and that it would have been difficult to view that the size of the CCTVs installed in the instant elevator with the Defendant at the time of installation of the fixed camera type 4 separate from the size of the fixed cameras installed in the instant elevator type, and that the size of the CCTV units installed in the instant elevator type 4 different from the size of the fixed camera type.

2. However, it is difficult to accept the judgment of the court below for the following reasons.

A. The Plaintiff is obligated to implement the instant contract. The circumstance that the Defendant, without recognizing the error in the request for re-approval of the user who stated material different from the shop design, did not affect the Plaintiff’s failure to perform the contract. Rather, the Plaintiff’s request for approval, which stated material different from the shop design, should be viewed as the Plaintiff’s mistake. Meanwhile, the Plaintiff’s request for approval, which stated material different from the shop design, is still indicated in the carmer size column (Evidence 7) according to the shop design (Evidence 7), and the Defendant, upon the Plaintiff’s request for approval of the main material, obtained approval on the condition that the Plaintiff satisfied the specifications stated in the purchase specifications and complements the Plaintiff’s request for approval through prior technical consultation with an authorized certificate and test report of the main material (part) selected through prior technical consultation. It is difficult to view that the Defendant, just because the Defendant approved the Plaintiff’s request for approval, impliedly consented to or consented to the installation of a fixed car camera in the instant elevator.

B. The lower court appears to have had no intention to install CCTV using a fixed camera from the beginning on the ground of the absence of the grounds for disposition, and there was no intent to gain unjust profits. While citing the circumstances, it is difficult to view that the Plaintiff’s subjective circumstance does not constitute “a case where it is evident that it would interfere with the proper implementation of the contract” due to the weight of the Plaintiff’s subjective circumstance. Although the Plaintiff installed a CCTV supplied by A without properly verifying the quantity of CCTV supplied by the Plaintiff, the Plaintiff, as the Plaintiff implementing the contract, should have ordered the camera in compliance with the contract standard, should have confirmed whether the CCTV was supplied as ordered, and if so, he should have installed the camera. This is the basic duty of care required for the business entity performing the construction, and thus, it cannot be viewed as a minor negligence of the Plaintiff.

D. The Defendant’s construction supervisor’s belief that the Plaintiff installed a camera in accordance with the instant contract, and the Defendant’s reply to other elevator manufacturers and installers see the model installed by the Plaintiff cannot be deemed as the construction direction against the Plaintiff. Thus, such reply cannot be deemed as justified for the Plaintiff’s nonperformance of contractual obligation.

E. A change in the distance between the Plaintiff’s fixed-type camera and the variable type camera as stipulated in the instant contract may not be readily concluded to have a functional difference. Even if the functional difference between the two cameras is low, a contractor may not be deemed to have been arbitrarily replaced, and it is necessary to consult with the Defendant in advance in order to install a product different from the contract. According to the witness B’s testimony, when the content of the instant general contract is unclear, error, or inconsistency in the name of the design, etc., the Plaintiff would prepare a document specifying the relevant matters prior to the implementation of the part requiring design change and notify the contracting officer and the construction supervisor. The Plaintiff did not undergo such procedures.

F. Comprehensively taking account of these circumstances as stated in the judgment below, it is reasonable to view that the Plaintiff’s non-performance of contract constitutes “a case where it is obvious that such failure will interfere with the proper implementation of the contract under Article 64-2(3) of the former Local Public Enterprises Act.” Nevertheless, the court below erred by misapprehending the legal principles on “an interpretation where it is obvious that the proper implementation of the contract will be interfered with” under the former Local Public Enterprises Act, thereby making a judgment.

3. Therefore, the lower judgment is reversed, and the case is remanded to the lower court for further proceedings consistent with this Opinion. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Kim Yong-deok

Justices Lee In-bok

Justices Kim Gin-young

Chief Justice Lee Dong-won