[Defendant-do Energy Co., Ltd. (Attorney Lee Jong-soo, Counsel for defendant-appellee)

Korea

December 23, 2009

Seoul Central District Court Decision 2008Gadan366042 Decided August 21, 2009

1. The defendant's appeal is dismissed.

2. The costs of appeal shall be borne by the Defendant.

1. Purport of claim

With respect to the arbitration case No. 0811-051 of the KCAB between the plaintiff and the defendant, the KCAB shall be allowed to enforce compulsory execution against 22,248,880 won and the amount calculated by the rate of 20% per annum from September 10, 2008 to the date of full payment.

2. Purport of appeal

The part against the defendant in the judgment of the court of first instance shall be revoked, and the corresponding plaintiff's claim shall be dismissed.

1. Quotation of judgment of the first instance;

The reasons why a member should explain this case are as follows, the part concerning the defendant's argument stated in Chapters 4, 18, 7, and 14 of the judgment of the court of first instance is as stated in the judgment of the court of first instance, and therefore, this part is cited in accordance with the main sentence of Article 420 of the Civil Procedure Act.

C. Judgment on the defendant's assertion

(1) The defendant's assertion

The phrase “inspection request” under Article 5(1) of the Special Conditions for the Purchase of Goods (Manufacture) contract between the Plaintiff and the Public Procurement Service (hereinafter “instant goods contract”) shall be made together with the submission of a written request for inspection stating the contract number, name, payment period, date of the request for inspection, place of inspection, etc. The document of “request for inspection related to the supply of goods (application for inspection)” submitted by the Plaintiff on December 28, 2007 is not in the form of the written request for inspection as well as the actual delivery. As such, it cannot be said that there was a legitimate request for inspection by 30,000,000 delivered on December 31, 207, which is the delivery date of the instant 40,0000,000 won x 20,000 won, 20,000 won, 20,000 won, 6,000,000 won x 16,07,000 won, 208,06,06,04,01.

(2) Facts of recognition

The following facts shall not be disputed between the parties, or may be recognized by comprehensively taking into account the descriptions of Gap evidence 6, Eul evidence 1 through 4, and the whole purport of pleadings:

(A) According to the instant goods contract between the Plaintiff and the Public Procurement Service (contract No. 12071364900), the time limit for the supply of the instant amnesty machines, etc. is December 31, 2007; the air force central management body; the place of delivery; the place of delivery; the place of delivery; and the inspection and inspection agency are the demanding administrative agency.

(B) On February 12, 2008, the Air Force Central Management Body rendered a decision of passing the inspection retroactively on February 29, 2008, pursuant to the instant arbitral award to the effect that the above amnestys, etc. comply with the national defense standards, although the inspection was conducted on February 12, 2008.

(C) On December 28, 2007, the Plaintiff sent a document stating that “1. The contract number 12071364900 of the Procurement Service’s contract number is 12071364900,” under the title “(s) of the request for cooperation in the supply of goods (application for inspection) to the Air Force Headquarters (40 SPS). 2. As to the technical inspection, the Plaintiff sent the document stating that “I will apply the general terms and conditions of the goods purchase contract. 3. Other matters will be applied to the goods purchase contract.”

(D) The Plaintiff’s request date for inspection was entered on December 28, 2007, and thereafter revised on February 12, 2008. The date of commencement of inspection was written on February 12, 2008, February 13, 2008, and February 29, 2008, as of the date of completion of inspection and inspection.

(3) Determination

(A) Article 14(1) of the Act on Contracts to Which the State is a Party provides for the duty of the public official in charge to inspect the goods in the performance of the contract for the supply of goods to the State. Article 2(2) of the Goods Purchase (manufacture) Special Conditions (hereinafter “Special Conditions”) defines “inspection” as “the confirmation of whether the subject matter of the contract meets the relevant Acts and subordinate statutes and is manufactured and installed in accordance with the purchase specifications and specifications,” and Article 5(1) of the Special Conditions provides that “the contractor shall request the relevant goods to the end-user within the delivery period,” and Article 10(2)1(a) of the Special Conditions provides that “the period required for the delivery inspection and inspection shall not be included in the number of days required for the inspection if the goods have passed the inspection after the delivery period and passed the inspection after the expiration of the delivery period,” and Article 10(2)1(c) of the same Act provides that “The number of days required for the inspection shall be calculated from the date following the delivery period to the date of the final inspection.”

(B) In light of the above provisions, as to the performance of a contract to which the State is a party, unlike the contract between private persons, the public prosecutor of the public official in charge should be prior to the contract between private persons. Thus, the counter-party to the contract must request the inspection of the pertinent goods to fulfill the contractual obligation. Even if the counter-party to the contract requests the inspection, the specific method, time, place, etc. of the inspection is decided by the demanding administrative agency belonging to the defendant, which is the main agent of the inspection. Thus, it is reasonable to deem that the counter-party to the contract requesting the inspection is prepared to the extent that the inspection is possible to be delivered immediately after the completion of the inspection in the cooperation of the public official in charge, and it does not necessarily require a real delivery act. The counter-party to the contract that the public official in charge of the inspection requests the inspection does not necessarily require a delivery act in writing, and even in the form of the contract, the plaintiff does not have any specific restriction on the form of the document or the method of submission in writing. Thus, the plaintiff is not obligated to lawfully bear the defendant's liability for delivery of the above goods.

2. Conclusion

Therefore, the judgment of the court of first instance is just and the defendant's appeal is dismissed. It is so decided as per Disposition.

Judges Lee Jong-tae (Presiding Judge)