All appeals are dismissed.

The costs of appeal are assessed against the plaintiffs.

The grounds of appeal are examined.

1. A claim for indirect construction expenses incurred by the extension of the construction period;

A. Article 21(2) of the Act on Contracts to Which the State is a Party (hereinafter “State Contract Act”) provides that “The head of each central government office or each contracting officer may enter into a contract for long-term equipment as prescribed by Presidential Decree in cases of lease, transportation, storage, supply of electricity, gas and water, and other contracts where it is necessary to continue to exist for several consecutive years in light of their nature, or where it is necessary to continue to exist for several years in implementation.

In such cases, the relevant contract shall be implemented within budgetary limits of each fiscal year.

“......”

Article 69 (2) of the Enforcement Decree of the Act on Contracts to Which the State is a Party shall additionally state the total construction cost determined by a successful bid, etc. and enter into a contract with the State to implement the first construction within the scope of the budget for the relevant year.

In such cases, a contract after the second construction project shall be concluded within the extent of the amount calculated by deducting the amount already contracted from the total cost additionally stated (referring to the adjusted total cost, if there is an adjustment of contract price under Articles 64 through 66).

“......”

On the other hand, continuing expenditure contract is a contract in which annual installments are executed according to the fiscal year by setting the total amount of a project over several fiscal years with prior resolution of the National Assembly for the total expenses of the project.

On the contrary, a contract for construction works on the part of a primary-year construction project takes place in the form of an additional note of the total construction cost and the total construction period when concluding the first-year construction contract (see, e.g., Supreme Court Decision 201Da35189, Oct. 30, 2018). The Supreme Court Decision 201Da235189 Decided October 30, 2018.