Seoul High Court Decision 200Do1448 decided May 1, 200

Korea

July 24, 2009

1. As to the arbitration case between the Plaintiff and the Defendant regarding Article 0811-051 of the Korean Commercial Arbitration Act, the Korean Commercial Arbitration Board permits compulsory execution against the amount of KRW 10,812,57 among the arbitral awards on September 10, 2008 and KRW 9,302,629, calculated by the rate of 20% per annum from September 26, 2008 to the date of full payment.

2. The plaintiff's remaining claims are dismissed.

3. Of the costs of lawsuit, 50% is borne by the Plaintiff, and 50% is borne by the Defendant.

4. Paragraph 1 can be provisionally executed.

With respect to the arbitration of the KCAB case between the plaintiff and the defendant, 22,248,880 won among the arbitral awards on September 10, 2008 and the amount calculated by the ratio of 20% per annum from September 10, 2008 to the full payment date.

1. Basic facts

The following facts are not disputed between the parties, or may be acknowledged in full view of the entries in Gap evidence 1 and the whole purport of pleadings:

A. The Plaintiff entered into a purchase contract with the Public Procurement Service for the three-day flag to be supplied to the Air Force President, and supplied the three-day flag. However, on September 10, 2008, the Korea Commercial Arbitration Board filed an application for arbitration with the Korea Commercial Arbitration Board on the ground that the goods were not paid by the Public Procurement Service. On September 10, 2008, the Korea Commercial Arbitration Board paid to the Plaintiff the amount of KRW 113,473,849 and the amount calculated by the rate of 20% per annum from September 11, 2008 to the date of full payment (hereinafter “instant arbitral award”). The arbitration costs are to be borne by the Defendant (hereinafter “instant arbitral award”).

B. On September 25, 2008, the Defendant paid KRW 104,171,220 to the Plaintiff.

2. Judgment on the plaintiff's assertion

A. The plaintiff's assertion

If the amount paid by the defendant is appropriated to the principal of the arbitral award, the principal of the arbitral award remains at KRW 9,302,629, and the interest for delay on the amount paid by the defendant remains at KRW 79,122, interest for delay on the amount paid by the defendant 489,34, interest for delay on the amount not paid, KRW 639,464, interest for delay on the amount not paid by the arbitration, KRW 99,576, the amount not claimed at the time of arbitration, KRW 3,300,00, traffic cost of the trial, KRW 400,00, KRW 80,000, the amount collected as evidence, KRW 30,00, and KRW 22,248,880, the sum of the interest for delay on the amount paid by the plaintiff 5,218,746, and delay damages thereon.

B. Determination

(1) In this case where compulsory execution is sought based on the arbitral award of this case, the plaintiff can enforce compulsory execution only for the arbitration costs within the scope recognized by the arbitral order and the arbitral rules. Thus, there is no ground for the plaintiff's assertion as to the amount of KRW 99,576 not claimed at the time of arbitration, and there is no ground for not included in the arbitral award in the remaining parts excluding the arbitration costs among the amount claimed by the plaintiff.

(2) Then, examining the scope of compulsory execution based on the arbitral award of this case among the arbitration costs that the plaintiff is entitled to be borne by the arbitral award of this case (Evidence B of the Arbitration Rules), the Arbitration Rules (Evidence B of the Arbitration Rules) provides that “The arbitration costs shall be subdivided into charges, expenses, and allowances as provided for in Articles 62 through 64 of the Rules (Article 61(1)); and “the fees shall be subdivided into the administrative fees and the hearing extension charges, and shall be prepaid: Provided, That the fees for the hearing extension shall not be imposed if the delay is made ex officio by the arbitral tribunal (Article 62(1)); “the expenses of the arbitrator and clerk; the expenses of the witness or appraiser; the expenses for the examination or investigation; the expenses for the recording of stenographic records or stenographic records; and all other expenses for the arbitration shall be prepaid by the party at his request (Article 63(1)); “Where the expenses under paragraph (1) are paid by the arbitral tribunal, the applicant shall, unless otherwise stipulated in Article 63(2) and Article 6(2) through 64(6) of the Secretariat’s).”

In accordance with the above Arbitration Rules, the expenses for arbitration set forth in the arbitral award are prepaid. Thus, the plaintiff may enforce compulsory execution against the 639,464 won of the advance payment prepaid by the plaintiff in this case, but the remaining amount cannot be subject to compulsory execution based on the arbitral award in this case. Thus, the plaintiff's above assertion is justified only within the scope of the above recognition.

(3) Ultimately, according to the arbitral award of this case, the plaintiff can enforce compulsory execution against the sum of KRW 113,473,849 and KRW 20% per annum from September 11, 2008 to the full payment date, and KRW 639,464. The defendant paid KRW 104,171,220 on September 25, 2008. Since there is no dispute between the parties that appropriated the amount for principal, the amount of claims against the defendant as of September 26, 2008 against KRW 9,302,629 ( KRW 113,473,849 - KRW 104,171,20) and KRW 208, KRW 208, KRW 208, KRW 309, KRW 2084, KRW 208, KRW 209, KRW 208, KRW 209, KRW 208, KRW 30684,965,29.284, etc.

C. Judgment on the defendant's assertion

(1) The defendant's assertion

According to Article 10(2)1 (c) of the Special Conditions for the Purchase of Goods (Manufacture), which is the terms and conditions of the contract between the Plaintiff and the Public Procurement Service, "the number of days of delay shall be calculated from the following day of the delivery period to the date of passing the final inspection." Thus, the delivery date of the three-day period of this case shall be December 31, 2007, and the date of the Plaintiff's request for inspection shall be February 12, 2008, and the inspection was completed on February 29, 2008, the rate of liquidated damages shall be calculated as 0.015, calculated as 10,302,640 won, and the amount of liquidated damages shall be calculated as 103,171,209 won (13,47,4849, 1049, 2030, 209, 209, 304, 2005, 209, 2005, 2014).

(2) The plaintiff's assertion

On this point, the plaintiff asserts that the delivery date of the three-dimensionals of this case was April 30, 2008, and that the plaintiff's request date for inspection was December 28, 2007, and therefore, the plaintiff did not bear any delay liability under Article 10 (2) 1 (a) of the Special Conditions for Purchasing Goods.

(3) Determination

(A) The term “inspection” refers to verifying whether the subject matter of a contract conforms to the relevant Acts and subordinate statutes and is manufactured or installed in accordance with the purchase specification, specifications” (Article 2 subparag. 2); “The contractor shall request an inspection of the relevant goods to an end-user institution within the delivery period specified in a contract or a written request for delivery under Article 12(1) of the General Conditions” (the main sentence of Article 5(1)); and “the delivery date specified in the main sentence of Article 5(1) and (3) shall be as follows: (a) the delivery date specified in the main sentence of Article 5(1); (c) the delivery date specified in the main sentence of Article 1; (c) where the subject matter of a contract has been requested for an inspection within the delivery period; (d) the delivery date specified in the main sentence of Article 5(1) and the date specified in the main sentence of Article 5(2) shall be deemed to have passed the inspection; and (e) the delivery date specified in the following provision shall not be deemed to have passed the inspection without delay within the delivery date specified.

(B) First, examining the delivery date of the instant goods contract, according to the statement No. 1, the delivery date is recognized as December 31, 2007.

(C) Next, considering the meaning of “inspection” under Article 2 subparag. 2 of the Goods Purchase Contract, the “inspection request” for the goods should be made in reality. However, the “inspection request” does not specify specific conditions for the goods purchase contract, general conditions, and the procedures for the performance of the duties of the Public Procurement Service, such as the entry in the evidence No. 13, and it is necessary to inform the public of the place, time, and other conditions of the goods to be equipped for the inspection, and it is possible to make an application in writing without providing the goods in reality. According to the evidence No. 6, the Plaintiff may make an application in writing without providing the goods to the Public Procurement Service, and the Plaintiff may make an application in writing with the 0th anniversary of the date of entering the instant goods contract into with the Public Procurement Service to the head of the Gun located in Daegu Metropolitan City to supply the 20th day of the goods purchase request to the Public Procurement Service to enter the 20th day of the goods purchase request in the form of “No. 1, 2013 of the Goods Goods Purchase Request No. 2.

According to the above facts, the plaintiff seems to have requested an inspection on December 28, 2007, which was before December 31, 2007, which was the delivery date, before December 31, 2007. Thus, the plaintiff is not liable for delay under the purchase contract under Article 10 (2) 1 (a) of the special condition for the purchase of goods. Thus, the defendant's assertion premised on the plaintiff's liability for delay is without merit.

3. Conclusion

Thus, the plaintiff's claim is justified only within the scope of the above recognition, and the remaining claim is dismissed as it is without merit.

Judges Kim Sang-dong