2012Da89313 Construction Price

1. A new comprehensive construction company;

2. Effectiveness of the stock company;

Mabiode Mag-si

Co., Ltd.

Seoul High Court Decision 2008Na48195 Decided August 22, 2012

February 26, 2015

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

The grounds of appeal are examined (to the extent of supplement in case of supplemental appellate briefs not timely filed).

1. Regarding the plaintiffs' grounds of appeal

A. As to the second ground for appeal

In light of the circumstances stated in its reasoning, the lower court determined that the amount of separation through the first instance court’s separation machine (the first instance court’s separation machine) was erroneous in failing to perform the duty under the construction contract of this case by manufacturing and supplying at low prices, and thereby preventing the escape effect at all at the second instance court’s separation machine (the separation machine), and further, the instant food waste disposal facility of this case was likely to achieve the target material balance, such as the rate of recovery of secondary fuel materials, which is the designed value, if necessary, by expanding the storage tank capacity corresponding to the design error of the design of the design of this case and supplementing the facilities such as pressure injury, concentration, etc., if necessary, if necessary, it appears that the removal of secondary fuel materials can be achieved. However, even if the design error is expanded and supplemented due to the voluntary change in construction of the removal and repair period, the food waste disposal facility of this case reached the normal waste disposal facility of this case, thereby making it difficult to operate the aforementioned food waste disposal facility of this case.

In light of the records, the above judgment of the court below is just and acceptable, and there is no violation of law of free evaluation of evidence in violation of logical and empirical rules as to construction defects as otherwise alleged in the grounds of appeal.

B. Ground of appeal No. 1

1) The lower court determined that the instant penalty for delay was KRW 1,062,205,676 on the premise that the standard amount of calculation of the penalty for delay was KRW 5,156,338,237, the construction cost of the machinery of the instant food waste disposal facilities, among the instant construction contract for construction works.

2) However, the lower court’s determination that deemed the standard amount for calculating the instant liquidated damages as KRW 5,156,338,237 is difficult to accept for the following reasons.

First of all, the defendant claimed that the amount of liquidated damages is KRW 1,062,205,670, and the basis for calculation is the same as the statement in Gap evidence 7, and the above documentary evidence stated that the amount of liquidated damages is the construction cost excluding civil engineering, construction, and fire fighting, among the treatment facilities in this case. Therefore, it is reasonable to view that the defendant asserted the construction cost of excreta treatment facilities in this case and food waste treatment facilities, namely, the part excluding civil engineering, construction, and fire fighting, among the instant facilities and food waste treatment facilities, as the base amount for calculating the liquidated damages in this case.

If so, the court below should have appropriately exercised the right of explanation and clearly made it clear whether the contract price claimed by the defendant as the standard amount for calculation of liquidated damages under Article 25(2) of the General Conditions of the Construction Contract incorporated into the contract for the construction work in this case refers to the construction work price of the excreta treatment facilities in this case and the machinery construction works of food waste treatment facilities in this case, or whether only the construction work price of the machinery construction works of the food waste treatment facilities in this case

Next, the reasoning of the judgment below is that the court below did not find the grounds for recognizing the construction cost of the machinery of the food waste disposal facility of this case as KRW 5,156,338,237 (the judgment of the court below stated that "the construction cost of the machinery of the food waste disposal facility of this case was 5,156,338,237" among the construction contract of this case, but there was no fact-finding as to this point in the front part of the construction contract of this case). Even if the court below decided that the above amount was recognized by the statement of evidence No. 7, even if it decided that the above amount was recognized by the statement of evidence No. 7, 5,156,338,237 won means the total construction cost of the food waste disposal facility of this case and food waste disposal facility of this case, it cannot be deemed that the construction cost of the machinery of the food waste disposal facility of this case refers to the part of the construction cost

3) Nevertheless, on the grounds stated in its reasoning, the lower court determined that the standard amount of calculation of the penalty for delay in the instant case was KRW 5,156,338,237 for the construction cost of machinery of the instant food waste disposal facilities, and accordingly, calculated the penalty for delay in the instant case. In so doing, the lower court erred by misapprehending the bounds of the principle of free evaluation of evidence against logical and empirical rules by failing to perform the duty of explanation as to the standard amount of calculation of the penalty for delay in the instant case, and thereby

2. As to the Defendant’s ground of appeal

A. The agreement on compensation for delay is an estimate of the amount of compensation for delay as to delay in the completion of the same day. Thus, in a case where the contractor is liable to pay the compensation for delay because he did not complete the work within the agreed period and did not deliver it to the contractor, the court may reduce the amount of the compensation for delay calculated according to the agreement by taking into account all the circumstances such as the status of the party to the contract, the purpose and contents of the contract, the motives scheduled for the compensation for delay, the actual damages and the amount of the compensation for delay, the comparison between the compensation for delay and the amount of the compensation for delay, the transaction practices at the time, and economic conditions, etc. (see, e.g., Supreme Court Decision 2001Da1386, Sept. 4, 2002).

Examining the reasoning of the judgment below in light of the above legal principles and records, the judgment of the court below, which considers one of the circumstances in which the period and expenses required for the improvement and repair of the food waste disposal facilities of this case were increased due to the replacement of the separation machine of the court below, even though the improvement and repair work was possible, such as expansion of the capacity of storage, installation of supplementary installation of pressure and injury tanks, replacement of the separation machine, etc., after gathering sufficient opinions from the designer of this case, the supervisor of this case, and experts in the related fields after the normal operation of the snow at the time of treating the food waste of this case, shall be justified, and there is no violation of law such as misunderstanding of legal principles as to the reduction of liquidated damages, contrary to the allegations in the grounds of appeal.

B. However, as seen earlier, the calculation of the liquidated damages for delay is unlawful, and the calculation of the liquidated damages for delay must be re-calculated, and the matters to be considered in the reduction of the liquidated damages or the rate of reduction may vary depending on the calculation of the liquidated damages for delay. Thus, the defendant's remaining grounds of appeal concerning the reduction

3. Conclusion

Therefore, 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.

Justices Lee Jae-soo

Justices Kim Yong-deok

The Chief Justice Park Jae-young

Justices Kim Gin-young