계약의 보충적 해석과 소멸시효 = Supplementary Interpretation of Contracts and Extinctive Prescription

다국어 초록 (Multilingual Abstract)

Methods of interpreting legal acts, among others, contracts, are largely classified into natural interpretation, normative interpretation, and supplementary interpretation. Among them, the supplementary interpretation of a contract means 'a method of interpreting a contract whereby, if both parties made the same error regarding the premise or basic matter of the contract and made no specific agreement due to such error, the parties' intention is supplemented with the content that the parties would have agreed if there had been no such error (Korean Supreme Court Decision 2009Da91811 rendered on November 13, 2014).
Meanwhile, Article 166 (1) of the Korean Civil Code stipulates that ``the extinctive prescription shall run from the time when a right can be exercised,'' and the Korean Supreme Court determines the starting point of computing extinctive prescription based on existence or non-existence of legal obstacle, and has consistently maintained such stance that even if the parties to a contract did not know, or are not negligent in knowing, the existence of the right or the possibility of exercising the right, such reason cannot be regarded as a legal obstacle (Korean Supreme Court Decision 2008Da15865 rendered on September 9, 2010). Even if a party to the contract is acknowledged to have the right to assert claims against the other party according to the supplementary interpretation of the contract, due to the gap between the point in time when the contract is executed and the point in time when the court makes the supplementary interpretation of the contract, whether the extinctive prescription of the right to assert claims is completed can be the last difficulty for rational adjustment of interests between the parties, and in particular, for contracts subject to the short-term extinctive prescription under Article 163 of the Korean Civil Code.
Even if the establishment of a series of the right to assert claims is recognized through the supplementary interpretation of the contract, if the essential matters or important matters of such right have not been specifically specified or have not been established with criteria, it should be deemed that there is a legal obstacle such as non-fulfillment of conditions or non-arrival of an indefinite period due to which the above right may not be exercised. Therefore, it should be considered that the extinctive prescription runs from the point in time when the conditions were fulfilled or the deadline reached and the right to assert claims was exercisable.
In the Koren Supreme Court Case No. 2018Da278689 issued on February 14, 2019, due to the error of both the employer and the contractor regarding the VAT exemption rate, the contract amount was not inclusive of the VAT amount, and thus the contractor required the employer to pay the construction cost equal to the VAT amount after the contractor was imposed with the VAT amount from the tax authority. In the aforementioned case, the Korean Supreme Court acknowledged the claims on the construction cost equal to the VAT amount through the supplementary interpretation of the construction contract, and determined that the starting point of the extinctive prescription of the claims on the construction cost is the time when the tax authority imposed the VAT on the contractor rather than the time when the progress payment under the construction contract was charged. As such, the aforementioned court decision has great implications for the relationship between the supplementary interpretation of the contract and the extinctive prescription.