Standards for determining what guarantee accidents occur in the specialized construction mutual aid association's warranty liability;

Article 105 of the Civil Act, Articles 54 and 56(1)1 of the Framework Act on the Construction Industry, Article 56(2)5 of the Enforcement Decree of the Framework Act on the Construction Industry

[Plaintiff-Appellant] Plaintiff 2002Da55199 delivered on January 24, 2003 (Gong2003Sang, 717)

Seongdong Construction Co., Ltd.

Specialized Construction Financial Cooperative (Law Firm Taeil, Attorneys Lee Jong-soo et al., Counsel for defendant-appellant)

Seoul High Court Decision 2009Na38027 decided November 24, 2009

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

The grounds of appeal are examined.

1. An accident in various guarantees performed by a specialized construction mutual aid association pursuant to the Framework Act on the Construction Industry refers to an uncertain accident determined by specifying the duty to guarantee by a specialized construction mutual aid association, which is a guarantor. As such, what an accident in the warranty of defects lies in the warranty of defects should be determined by taking into account the terms and conditions of a guarantee incorporated into account and the specific terms and conditions of a letter of guarantee and a contract (see Supreme Court Decision 2002Da55199, Jan. 24, 2003).

2. According to the reasoning of the judgment below and the records, the defendant guaranteed the obligation of repairing defects to the plaintiff. Article 1 of the general terms and conditions of the contract for warranty of defects incorporated into the contract for warranty of defects provides that "the specialized construction mutual aid association shall pay to the other party (creditor) obligations arising from the failure of the contractor to perform the obligation related to the front construction works within the scope of the guaranteed amount or within the amount of the guaranteed amount as determined by the relevant Acts and subordinate statutes". The special terms and conditions of warranty provide that "the definition of the obligation to repair defects (limited to those arising within the guaranteed period or the responsible period)" shall be defined as "the obligation to repair defects arising from the violation of the design documents or other orders for the construction of stone". Article 2 of the domestic construction mutual aid association for warranty of defects incorporated into the contract for warranty of this case shall be excluded from the warranty of defects existing in the construction of stone of this case until the date the contractor fails to perform the obligation related to the construction works on the front, and the plaintiff shall be excluded from the warranty of this case's construction work of this case.

In light of the above legal principles and the above facts, first of all, in order to be recognized as a guarantee accident which specifically causes the defendant's obligation to pay a warranty bond to the plaintiff under the present warranty agreement between the defendant and the East Sea industry, a defect occurred due to a mistake in the construction work of the East Sea Industry, and the East Sea Industry requires not only the duty to repair the defect but also the duty to repair the defect. In order for the East Sea Industry to be recognized as a guarantee accident due to the failure to perform such duty to repair the defect, it should be proved that the plaintiff, the guarantee creditor, filed a claim against the East Sea Industry for the repair of the defect arising in relation to the instant tin construction work, but the East Sea Industry failed to perform such duty (see Supreme Court Decision 2006Da8780, Aug. 23, 2007).

Furthermore, unlike the terms and conditions of the construction mutual aid association, the term of "defect" in the defect guarantee agreement of this case is subject to guarantee without limiting it as "within the warranty period after being inspected or examined." However, in light of the fact that the error in the construction that does not have to occur before the warranty period, such as the non-construction or the modified construction, is not excluded from the object of guarantee, it is reasonable to deem that the "defect" subject to guarantee agreement of this case was erroneous in the construction such as the modified construction before the warranty period or the liability period, but it is also included that the plaintiff, who is the beneficiary, discovered such error in the construction before the warranty period or the liability period, and thereby the request for defect repair occurred within the warranty period or the liability period.

Therefore, as seen in the above facts, although the defects constructed using the domestic stone instead of the domestic stone for the execution of the East Sea Industry had been done before the warranty period or liability period, it is reasonable to view that, in the case where the plaintiff, the beneficiary, was notified of the construction of the domestic stone within the warranty period or the liability period, and at that time, the plaintiff, the beneficiary, requested the repair of the defects within the warranty period or the liability period, the defects constructed with the Chinese stone that occurred before the warranty period or the non-performance of the warranty obligation and its obligation are also the defects that become the object of the warranty of the warranty agreement of this case, and the guarantee accident that the East Sea Industry's failure to pay the same industry for such defects was within the warranty period or the liability period.

3. Nevertheless, the court below rejected the Plaintiff’s claim against the Defendant on the ground that: (a) defects that occurred before the warranty period or liability period, including construction errors, do not constitute defects subject to the warranty of the contract of this case; and (b) the guaranteed accident, which caused the same sea industry’s warranty liability, occurred before the warranty period or liability period, was taken over on September 30, 2003; and (c) the Plaintiff’s claim against the Defendant was rejected. In so doing, the court below erred by misapprehending the legal principles on defects in the guarantee of the Specialized Construction Mutual Aid Association and the guarantee accident, which affected the remaining judgment. The ground of appeal pointing this out has merit.

4. Therefore, without examining the remaining grounds of appeal, the judgment of the court below is reversed, and the case is remanded to the court below for a new trial and determination. It is so decided as per Disposition by the assent of all participating Justices on the bench

Justices Kim Shin (Presiding Justice)