The judgment below

The part against the defendant is reversed, and that part of the case is remanded to the Seoul High Court.

The grounds of appeal are examined.

1.(a)

The period of extinctive prescription shall not run from the time when a right has arisen objectively and is able to exercise such right, and while it is impossible to exercise such right.

Here, the term "non-exercise of rights" refers to the cases where there is a disability in the exercise of rights, for example, such as the non-performance of the period or the non-performance of the terms and conditions, and the reason why the exercise of rights is virtually difficult does not constitute such cases.

However, the exercise of the right of defense on the ground of extinctive prescription is governed by the principle of good faith and prohibition of abuse of rights, which are the major principle of the Civil Act. Thus, in special circumstances where the exercise of the right cannot be expected due to the de facto disability that could not exercise the right objectively before the completion of extinctive prescription, the obligor’s assertion of the completion of extinctive prescription

(see, e.g., Supreme Court Decision 93Da27604, Dec. 9, 1994). Meanwhile, even in cases where there was an objective disability in which the obligee could not expect the obligee to exercise his/her right, if such disability was terminated, the obligor’s defense of extinctive prescription may be prevented only within a reasonable period from exercising his/her right.

In such a case, whether the right can be deemed to be exercised within an “reasonable period” ought to be determined by comprehensively taking into account various circumstances, such as the relationship between the obligee and the obligor, the cause of the claim for damages, the cause of the obligee’s exercise of right, the grounds why the obligee

However, since the extinctive prescription system is based on the principle of the achievement of legal stability and the remedy for difficulty in proof, it is very exceptional to deny the effect of the extinctive prescription based on the principle of good faith.