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Legal issues and Implications of the Long-Term Continuous Construction Contracts – Supreme Court 2018. 10. 30., 2014Da235189 -

  • Public Land Law Review
  • Abbr : KPLLR
  • 2019, 87(), pp.229-257
  • Publisher : Korean Public Land Law Association
  • Research Area : Social Science > Law
  • Received : July 31, 2019
  • Accepted : August 20, 2019
  • Published : August 27, 2019

Hong, Sung-Jin 1

1대한건설정책연구원

Accredited

ABSTRACT

In the Supreme Court 2018. 10. 30., 2014Da235189, the majority of the opinions determined that the contract amount cannot be increased on the grounds of extension of the total construction period because there is no legal binding force for the entire project contract of long-term continuous construction contracts is linked according to the conclusion of each annual contract. In contrast, the minority opinions decided that the legal force should be recognized of the entire project contract because the contract partner would deprive itself of the opportunity to obtain adjustment of contract amount due to extension of the total construction period. A long-term continuous construction contract is realized as a general contract, and an annual contract is merely a technical and expedient separation of a single contract by several different levels depending on the budget situation. In particular, even if there is a break in the annual contract or an extension of the construction period of the annual contract due to the responsible reason of the order, the orderer may extend the total construction period by adding the annual contract to the next annual contract by including the construction cost. In this case, if the legal force of the entire project contract is denied, the contract partner can not apply for the adjustment of contract amount, and the overhead cost must be paid unilaterally. The entire project contract shall be applied as the execution standard for long-term continuous construction contracts and the payment of overhead cost for extension of construction period, and the order authority shall pay additional overhead cost in accordance with the legal principles on adjustment of contract price. To this end, the state and local governments shall revise the “Enforcement Decree of the Act on Contracts to which the State is a Party” and “Enforcement Decree of the Act on Contracts to which a Local Government is a Party”, “General conditions of construction contract” etc. to define the overall contract as the enforcement standard for adjusting of contract price, and provide a legal basis for the extension of the period of the order in which the order is not attributable to the other party. In addition, Government procurement should be regarded as a contracts in public law because it has the nature of financing, problems of control of the officials in charge, and other specificities than judicial contracts. Therefore, long-term continuous construction contracts should be regarded as contracts in public law and settled by a party suit under the “Administrative Litigation Act” to understand the reality of long-term continuous construction contracts. The party suit is an administrative suit due to its nature, but the administrative case dealt with as a civil procedure for convenience can be judged on the basis of professionalism and specificity, thus contributing to the relief of the people's rights. To this end, it is necessary to prepare a revision to the “Administrative Litigation Act”, together with a detailed discussion for the application of long-term continuous construction contracts to as the cases of Party suit.

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