2017Da49204 ( principal office) Construction Costs

2017Da49211(Counterclaim) Claim for the cost of repairing defects and issuance of a certificate of warranty for defects

J Co., Ltd.

person

B

Attorney Kang Chang-soo, Counsel for the defendant-appellant

Jeju District Court Decision 2017Na421, 2017 4438 (Counterclaim) Decided September 27, 2017

February 8, 2018

Of the judgment below, the part against the Defendant (Counterclaim Plaintiff) and the part against the counterclaim shall be reversed, and this part of the case shall be remanded to the Jeju District Court.

The grounds of appeal are examined.

1. According to the reasoning of the first instance judgment cited by the lower court and the reasoning of the lower judgment, the lower court determined as follows.

A. Determination on the claim of this case

Since the changed construction cost of the instant construction cost is KRW 770 million, and the construction cost paid by the Defendant (Counterclaim Plaintiff; hereinafter “Defendant”) to the Plaintiff (Counterclaim Defendant; hereinafter “Plaintiff”) is KRW 742,884,075, the unpaid construction cost is KRW 27,115,925 (i.e., KRW 7770 million - KRW 742,84,075), or the construction cost presumed to be incurred for repair due to defects in the part that the Plaintiff had not been constructed or constructed, due to the first instance court’s entrustment of appraisal to the appraiser company, is KRW 1,890,00,000,000. Accordingly, if the damages claim in lieu of the defect repair claim against the Plaintiff due to the Defendant’s defense offsets the Plaintiff’s unpaid construction cost claims against the Defendant, the Defendant is liable to pay the Plaintiff the unpaid construction cost to the Plaintiff as the construction cost (i.e., KRW 15,2525,271,15925).

B. Determination on the instant counterclaim claim

The Defendant sought compensation of KRW 1,189,00,00 in lieu of the defect repair recognized by the first instance court on the premise that the Plaintiff paid all the instant construction cost. However, as seen earlier, the Defendant’s counterclaim claim of this case premised on the fact that there was KRW 27,115,925 of the construction cost unpaid by the Defendant. Even if the Defendant’s assertion that the sum of the construction cost that the Defendant is not liable for payment due to the non-construction or defect includes KRW 23,691,560, not KRW 1,189,000 recognized by the first instance court, the Defendant’s claim for counterclaim cannot be accepted. However, according to the result of the appraisal commission to the company of the first instance court, even if the Plaintiff’s claim that the sum of the construction cost that the Defendant is not liable for payment due to the non-construction or defect includes KRW 23,691,560,000, which is presumed to be required for repair due to the defect occurred in

2. The allegation in the grounds of appeal as to the changed construction cost of the instant construction project is nothing more than disputing the selection of evidence and fact-finding, which belong to the lower court’s exclusive jurisdiction, and it does not constitute legitimate grounds of appeal. Furthermore, in light of the records, the lower court’s determination that the changed construction cost was KRW 70 million is justifiable.

3. However, it is difficult to accept the lower court’s determination that the damage claim in lieu of the defect repair claimed by the Defendant in relation to the instant construction project was KRW 1,189,00 for the following reasons.

A. The record reveals the following facts.

(1) After submitting a written answer at the first instance trial, the Defendant asserted that the initial construction cost and additional construction cost of the instant construction are KRW 680 million and KRW 86,575,635, respectively, and the changed construction cost of the instant construction is KRW 7666,575,635 (= KRW 680,000 + KRW 86,575,635), or that the construction cost paid up to May 4, 2015 was KRW 742,884,075, which was paid by the Defendant by May 4, 2015. Since the construction cost and additional construction cost of the instant construction cost are KRW 23,691,560, the costs incurred by the Defendant directly executing construction or repairing them are no more than KRW 7665,575,638,8484,075,050, or more than KRW 5365,505,065,00.

(2) On August 9, 2016, the Defendant filed an application for appraisal of the amount of damages in lieu of the defect repair related to the instant construction project with the first instance court. At the time, the object of the application for appraisal was considerably divided into KRW 23,691,560, which occurred before May 4, 2015, and KRW 4,535,00 that occurred thereafter. Moreover, the Defendant also requested the appraisal of the Khoho window of the instant building and the additional cost of defect repair incurred after May 4, 2015.

(3) On October 4, 2016, appraiser L submitted a defective appraisal report related to the instant construction project to the first instance court. An appraiser presented his/her opinion that KRW 23,691,560 as the repair cost for the non-construction and defective parts incurred before May 4, 2015, and made an appraisal that the remainder of the defect, other than the foregoing part, requires the total construction cost of KRW 1,189,000 as the repair cost.

(4) On December 13, 2016, the Defendant stated to the effect that the amount of KRW 1,189,00,00 as verified through the above entrustment of appraisal should be deducted or offset at the date of the sixth pleading of the first instance trial, and the Defendant did not assert that the previous deduction or offset claim regarding the said amount of KRW 23,691,560 is withdrawn.

(5) The Defendant appealed to the judgment of the first instance on January 31, 2017 and filed a counterclaim of the instant case at the same time, and accordingly, the Defendant alleged to the effect that “the changed construction cost of the instant construction is KRW 766,575,635, or KRW 742,884,075, or KRW 23,691,560, which was incurred in the direct construction or repair of defects due to the occurrence of a defect in the existing construction or defects, is confirmed through the commission of appraisal, and the Defendant’s assertion as to the construction cost of KRW 23,691,560, which was incurred in the direct construction or repair of defects, does not have any construction cost to be paid to the Plaintiff. Rather, regarding the non-construction or defective parts additionally confirmed or occurred after May 4, 2015, the Defendant received the payment from the Plaintiff, and thus, the Defendant claimed as the counterclaim of the instant case.”

On August 23, 2017, the lower court stated to the same effect as the first date for pleading.

B. If factual relations are different, it is reasonable to view that the Defendant, on the ground that he had a damage claim of KRW 23,691,560 in lieu of the defect repair regarding the non-construction or defect portion occurred before May 4, 2015, the Defendant deducted from the construction cost of this case that the Defendant should pay to the Plaintiff or defense to the effect that it offsets the Plaintiff’s claim for the construction cost of this case against the Defendant. Even according to the result of the first instance court’s entrustment of appraisal, damages in lieu of the defect repair related to the construction work of this case should be deemed to exist in addition to the total construction cost of the appraisal document, not only KRW 118,90,000,000, which was claimed by the Defendant prior to May 4, 2015. Nevertheless, the lower court omitted its judgment without any deliberation as to the Defendant’s aforementioned defense, and in relation to the counterclaim claim of this case, the lower court erred by failing to exhaust all necessary deliberations or exceeding the bounds of the principle of free evaluation of evidence.

4. Therefore, the part against the Defendant regarding the principal lawsuit and the part regarding the counterclaim claim are reversed, and that part of the case is remanded to the lower court for further proceedings consistent with this Opinion. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Park Sang-ok

Justices Kim Jae-han

Justices Lee Dong-won

Justices Park Jong-young