CONTENTS
- 1. Lawsuit for an Agreed Sum | Definition
- - Legal Nature of an Agreed Sum
- 2. Lawsuit for an Agreed Sum | Conditions for Filing
- 3. Lawsuit for an Agreed Sum | Procedure
- - Extinctive Prescription of an Agreed-Sum Claim
- 4. Lawsuit for an Agreed Sum | How to Respond
- - Drafting the Complaint
- - Securing Supporting Evidence
- - Conducting the Litigation
- 5. Lawsuit for an Agreed Sum | Reviewing Precedents
- 6. Lawsuit for an Agreed Sum | Points to Note and Response Points
- - If You Need Legal Help
1. Lawsuit for an Agreed Sum | Definition
A lawsuit for an agreed sum refers to a civil lawsuit filed with the court where, in a situation in which a specific amount was agreed to be paid under a contract or agreement, the other party fails to perform that payment.
It is a general lawsuit seeking performance of a monetary claim under the Civil Procedure Act, and its formal name is the ‘suit for a claim for an agreed sum.’
This lawsuit goes beyond a simple money matter and includes a process of having the legal relationship across the contract as a whole judged, such as the validity of the contract, the genuineness of performance, and whether the conditions were met.
Legal Nature of an Agreed Sum
An agreed sum may generally be a guarantee deposit, a down payment, or an amount payable under specific conditions for the performance of a contract.
It is distinguished from a simple loaned amount or damages. Under the law, an agreed sum is money that must be paid when a certain act or event occurs in accordance with the conditions of a contract, and it appears in various forms such as the following.
-Down payment or guarantee deposit
-Cancellation money or penalty
-Part or all of construction payment
-Promise of periodic payment in commercial transactions
-Damages agreement set out in a settlement document
2. Lawsuit for an Agreed Sum | Conditions for Filing
Let us look at the conditions under which a lawsuit for an agreed sum can be filed.
1. Existence of the Agreement and a Contract
A contract or agreement must actually exist, and there should preferably be a written contract, agreement, estimate, settlement document, or the like.
An oral agreement is also valid under the Civil Act, but the burden of proof in a legal dispute is heavy and can be disadvantageous, so securing written evidence is very important.
2. Arrival of the Payment Deadline or Delay
The litigation requirement is met only when the agreed-sum payment date specified in the contract has passed, or, in the case of a conditional agreement, the agreed sum has not been paid even though that condition has been met.
Where the deadline has not yet arrived, the lawsuit may be rejected.
3. Performance of the Contractual Obligation
Because lawsuits for an agreed sum often involve bilateral contracts, the party making the claim (the plaintiff) must prove that he or she performed his or her own obligation.
For example, the plaintiff must be able to prove, with objective material, facts such as having delivered goods or provided services.
4. The Other Party's Refusal of Payment or Nonperformance
It must be a situation in which the other party has refused to pay the agreed sum or has failed to perform.
The other party's expression of refusal (KakaoTalk, email, certified content letter, and the like) or a prolonged state of nonperformance can support this.
3. Lawsuit for an Agreed Sum | Procedure
Let us look at the procedure for a lawsuit for an agreed sum.
1. Sending a Certified Content Letter
You first send a certified content letter to demand payment of the agreed sum from the other party and, at the same time, secure the effect of interrupting the prescription for a future lawsuit.
2. Applying for a Payment Order or Filing a Formal Civil Lawsuit
-Payment order: This can be applied for when the existence of the claim is clear and the likelihood of the other party contesting it is low. A title of execution can be secured within about two to three months.
-Civil lawsuit (formal suit): This is filed when the other party denies the existence of the contract or whether it was performed, or when there is a dispute. It can usually take six months to more than a year.
3. Small Claims and Conciliation Procedures
-Small claims: For a claim of 30 million won or less, the small claims procedure can be used, allowing a prompt judgment.
-Conciliation or recommendation of settlement: Conciliation or a recommendation of settlement may be used for the early resolution of the dispute, and many cases are concluded by agreement between the parties.
4. Compulsory Execution
After the judgment becomes final, if the other party does not voluntarily perform, you recover the amount by applying for compulsory execution, such as attachment, collection, or auction, against the debtor's property on the basis of the judgment.
Extinctive Prescription of an Agreed-Sum Claim
An agreed-sum claim is also subject to the rules on extinctive prescription, and if it is not claimed within a certain period, the right may be extinguished.
Agreed Sum | Type | Extinctive Prescription Period |
General money | Agreed sum (contract, etc.) | 10 years |
Commercial transaction | Credit sales amount | 5 years |
Construction payment | Production∙sales amount | 3 years |
▶Methods of Interrupting the Prescription
-Where the debtor partially performs or acknowledges the debt
-Filing a lawsuit, applying for provisional attachment or a provisional injunction, or applying for a payment order
-Filing a claim within six months after sending a certified content letter
4. Lawsuit for an Agreed Sum | How to Respond
Let us look at how to respond to a lawsuit for an agreed sum.
Drafting the Complaint
In accordance with the civil litigation form, you specify the fact of the agreement, the payment deadline, your own performance, and the other party's nonperformance, and submit the complaint to the court.
Securing Supporting Evidence
-Original contract and agreement
-Invoices and deposit confirmations proving performance of the agreement's conditions
-Circumstances showing the other party's refusal to pay (certified content letter, text messages, call recordings, and the like)
Without material such as the above, the likelihood of losing the case in court is high, so securing evidence before the lawsuit is the key.
Conducting the Litigation
You file with the civil division of the district court, and the standard is generally the court with jurisdiction over the defendant's address.
Non-face-to-face filing and proceedings are also possible through the electronic litigation system.
5. Lawsuit for an Agreed Sum | Reviewing Precedents
Let us review precedents on lawsuits for an agreed sum.
Case 1. Lawsuit for an agreed sum against a former agency, with a judgment ordering payment of 2.6 billion won in sound-source revenue
Composer and pianist E filed a lawsuit claiming an agreed sum due to a settlement dispute with the former agency Stomp Music, and the Seoul High Court rendered a judgment ordering payment of about 2.6 billion won plus delay interest.
In this case, the key issues were whether there was a conciliation agreement on the distribution of sound-source revenue even after the existing exclusive and copyright contract ended, and the interpretation of that distribution ratio and payment period.
The court determined that the distribution ratio (30%) agreed at the time of the conciliation was valid, and that, because no deadline for paying the distribution amount was specified, distribution must continue as long as revenue is generated from the work.
-Legal effect of the conciliation agreement: whether the obligation to pay the distribution amount remains even after the copyright contract ends
-Interpretation of the distribution ratio: whether the ratio in the existing contract (30%) can be applied identically to the conciliation agreement
-Duration of the distribution obligation: whether, where the conciliation agreement does not specify an end point for payment, the obligation to pay exists throughout the entire period in which revenue is generated
The core of the precedent is that it recognized that the obligation to distribute revenue under an agreement can continue even after the contract ends.
It is a case showing that, in a lawsuit for an agreed sum, the interpretation of the specific wording of a conciliation agreement and the continuation of obligations outside the contract became key standards for the judgment.
CASE 2. A lawsuit for an agreed sum and unjust enrichment after termination of an exclusive contract, but the case was lost
The Supreme Court confirmed a judgment partially in favor of the plaintiff in a lawsuit for an agreed sum that S filed against Choi, the representative of the former agency.
The court determined that, although grounds for terminating the exclusive contract were recognized due to a sex crime committed by an agency employee and similar matters, the total of about 300 million won, including the settlement amount (about 190 million won) and the unjust enrichment amount (about 110 million won) for revenue generated before the termination, must be paid to the agency under the exclusive contract.
-Justification for terminating the exclusive contract: breakdown of the relationship of trust due to a sex crime by an agency employee and the failure to make promised investments
-Settlement of revenue before termination of the contract: whether the obligation to settle revenue generated within the exclusive contract period continues
-Scope of recognized unjust enrichment: whether part of the revenue generated after termination of the exclusive contract belongs to the agency
This precedent is a case confirming the legal principle that, while recognizing the justification for terminating the exclusive contract, the obligation to pay under the contract remains valid as to the agreed sum and related costs that arose before the termination.
6. Lawsuit for an Agreed Sum | Points to Note and Response Points
Let us look at the points to note and response points for a lawsuit for an agreed sum.
▶Validity of the Agreement
-An unlawful agreement is determined to be void, and the claim may be dismissed.
-If the agreed amount is excessively large, it may be reduced or determined to be void for impairing fairness.
▶Proof of Contract Performance
-You must clearly prove, through documents or facts, that you performed your own obligation. If this part is insufficient, you may lose the case.
▶Identifying the Other Party's Defense Logic
-There is a high likelihood that the other party will deny the very existence of the agreement or argue that the payment conditions have not been met. In preparation for this, securing sufficient rebuttal material is necessary.
▶Checking the Debtor's Property
-Because compulsory execution must be considered, it is important to identify in advance whether the debtor has executable assets such as real estate, deposits, and wages.
Differences Between a Lawsuit for an Agreed Sum and Similar Lawsuits
Item | Lawsuit for an Agreed Sum | Lawsuit for Return of a Loan | Lawsuit for Damages |
Legal basis | Agreement under a contract | Nonreturn after a loan of money | Tort or nonperformance of obligation |
Point to establish | The contract and whether it was performed | The fact of the loan and the return deadline | Proof of loss and causation |
Prescription | Usually 10 years | 10 years | 3 years (from the time of the tort) |
They are easily confused, but because the purpose of the claim and the contents of the contract differ, you must decide on the filing of a suit suited to the case.
If You Need Legal Help
A lawsuit for an agreed sum is not a simple monetary claim but a lawsuit involving complex issues such as whether the contractual relationship has been performed, whether the agreement's conditions have been met, and the validity of the evidence.
In particular, in situations such as the following, the assistance of an attorney with expertise in civil litigation is necessary.
-Where there is a dispute over the interpretation of the payment conditions
-Where the other party firmly refuses to pay the agreed sum
-Where the extinctive prescription is imminent or has already passed
-Where compulsory execution is anticipated after the lawsuit
Therefore, if you are considering a lawsuit for an agreed sum, it is advisable to review the contract contents, payment conditions, the fact of performance, and supporting evidence as a whole with a legal professional in advance, weigh the practical benefit sufficiently, and then decide on your response.
Through the advice of an attorney specializing in civil disputes, a strategic approach that raises the likelihood of recovering the agreed sum and reduces litigation risk is important.
At our firm, attorneys who focus on civil matters and have handled many lawsuits for an agreed sum provide everything from contract review to practical response strategies.
We also collaborate with our evidence examination center to gather evidence when evidence collection is needed, and we promptly handle legal disputes that may arise during the litigation process.
Our firm operates branch offices in each region nationwide, runs a 365-day, 24-hour emergency consultation system, and provides non-face-to-face video consultation services.
