201Arbitral Tribunal 201 Gohap463

주식회사 ◎●◎

Location omitted

* Representative Director**

Attorney Lee - Law Firm *

주식회사 ☆○●◎

The location omitted.

* Representative Director**

July 6, 2011

July 20, 2010

1. With respect to the Korean Commercial Arbitration Claim 1111 - 004 case between the Plaintiff and the Defendant, the arbitral tribunal has revoked the arbitral award on April 7, 201.

2. The costs of the lawsuit shall be borne by the defendant.

The order is as set forth in the text.

1. Basic facts

A. Conclusion of the instant construction contract

On July 21, 2010, the Plaintiff entered into a contract with the Defendant for construction of solar energy-supply equipment (hereinafter “instant construction contract”). Article 38 (hereinafter “instant provision”) of the General Conditions for Construction Contract, which is attached to the said contract, provides for the following: (a) the construction contract for construction of solar energy-supply equipment (hereinafter “instant construction contract”).

Article 38 (Settlement of Disputes) (1) Any dispute arising between parties to a contract during the performance of a contract shall be settled by consultation. (2) If an agreement under paragraph (1) is not reached, the settlement shall be made as follows:

In the Plaintiff’s side, the general conditions of the instant construction contract were prepared by referring to the general conditions of the construction contract (established by Accounting Rules 04 - 104 - 21). The Plaintiff and the Defendant did not add the instant provisions through substantial discussions on the dispute resolution method while concluding the instant construction contract, and the Defendant sealed the instant construction contract and the general conditions of the construction contract prepared by the Plaintiff without specific review, except for the instant construction contract and the general conditions of the construction contract.

C. The Defendant raised an objection to the construction cost under the instant construction contract, and filed an application with the Korea Commercial Arbitration Board for arbitration against the Plaintiff pursuant to the instant provision, upon the occurrence of the dispute regarding the payment of the construction cost between the Plaintiff and the Plaintiff.

2) The Plaintiff asserted the absence of the arbitration agreement in the above arbitral proceedings, but the KCAB rejected the Plaintiff’s assertion on the ground that the instant provision cannot be seen as a selective arbitration clause, and that if one of the parties is selected by either of the parties in accordance with the arbitration procedure and the judgment procedure, the other party shall agree to agree to the award. “The judgment authority of the instant dispute is in the arbitral tribunal” (hereinafter referred to as “the instant arbitral award”).

【Uncontentious facts, Gap 1-3 evidence (including branch numbers), and the purport of the whole pleadings

2. Determination.

A. The plaintiff's assertion 1)

The instant provision constitutes a selective arbitration clause, and the Defendant’s application for arbitration under the instant provision is opposed to the resolution by arbitration by actively asserting the absence of an arbitration agreement. As such, the instant provision has no effect as an arbitration agreement, and thus, the instant arbitral award should be revoked.

2) Defendant’s assertion

If there is no agreement between the plaintiff and the defendant on dispute settlement, the arbitral tribunal should first follow the arbitration in accordance with the provision of this case, and as long as the defendant selects the arbitral proceedings for dispute settlement in accordance with the provision of this case, the arbitral award of this case is effective.

B. Determination

1) In order to consider that the standard of judgment of the selective arbitration clause and its specific validity are effective as an arbitration agreement, the selective arbitration clause is effective as an arbitration agreement only when one party to the contract selects an arbitration procedure to the other party and requests the dispute resolution in accordance with the procedure, and the other party participates in the arbitration procedure without any particular objection, based on the concept of arbitration under the Arbitration Act, the nature or method of arbitration agreement, etc. (see Supreme Court Decisions 2003Da318, Aug. 22, 2003; 2003Da42166, Nov. 11, 2004; 2005Da25294, Nov. 25, 2005, etc.). The selective arbitration clause is effective as an arbitration agreement in case where the other party actively objects to the resolution by arbitration by asserting the absence of the arbitration agreement in the written response against one party’s request for arbitration (see, e.g., Supreme Court Decision 2004Da42166, Nov. 111, 2004).

In light of the following circumstances, if subparagraphs 1 and 2 of the instant provision give priority, it may be deemed that the exclusive arbitration clause is an exclusive arbitration clause. However, the following circumstances, i.e., ① if the parties to a contract fail to reach an agreement on dispute between the parties, it shall be resolved in accordance with the following conditions, rather than granting priority among subparagraphs 1 and 2, (2) if one party first selects any of the procedures in arbitration and judgment, the other party must comply with such procedure. However, if the reasoning of the instant arbitral award is based on the reasoning of the instant provision, it is very insufficient to interpret the provision as an exclusive arbitration clause of the instant construction contract in light of the following circumstances:

In light of the above legal principles, as seen earlier, it is difficult to deem that the arbitration agreement between the Plaintiff and the Defendant was valid, inasmuch as the Plaintiff actively asserts the existence of the arbitration agreement as to the application of this case and clearly expresses his intention of opposing the resolution through arbitration, as long as the Plaintiff explicitly expresses his intention of opposing the resolution, it shall be deemed that the arbitration agreement between the Plaintiff and the Defendant is not effective. Thus, the provision of this case shall not be effective as an arbitration agreement.

Therefore, the plaintiff's assertion seeking the annulment of the arbitral award of this case has merit.

3. Conclusion

Therefore, the plaintiff's claim of this case shall be accepted on the grounds of its reasoning, and it is so decided as per Disposition.

Judges in order of the presiding judge

Judges Kim Gin-American

Judges Domen

1) Specific cases are as listed in the separate sheet.

2) Research on the role of the court in arbitration, see, e.g., a dissertation for a school of annual generation (2005) 48.

3) Whether the precedent pertaining to the same content as the instant provision is not verifiable

A person shall be appointed.