Labor Law Specialist Attorney | Successful Dismissal of a Claim for 150 Million Won in Labor Costs

1) Rebuttal of the Plaintiff's Assertions

The plaintiff asserted that it was appropriate for the client to pay the labor costs, on the basis of “where there is a clear reason that the contractor cannot pay the subcontract price, such as the contractor's bankruptcy, and the ordering party acknowledges this, the subcontract price corresponding to the portion executed by the subcontractor may be paid directly to the subcontractor,” Article 35, Paragraph 2 of the Framework Act on the Construction Industry.

In response, the labor law specialist attorney cited the precedent that held that “absent special circumstances, the ordering party must be regarded as bearing the obligation of direct payment up to the limit of its obligation to pay the price to the contractor,” namely Supreme Court Decision 2017Da242300 rendered on December 13, 2017.

On this basis, the labor law specialist attorney rebutted that since the client had already paid all of the construction price under the contract, the client had no obligation to pay the subcontractor's labor costs on its behalf.

2) Organization and Assertion regarding the Scope of Liability

The labor law specialist attorney made clear that the plaintiff had merely entered into an oral re-subcontracting relationship with Company A and had no direct contractual relationship with the client.

In addition, the attorney emphasized that the client had not been involved in the plaintiff's deployment of personnel or in any agreement to pay labor costs, and that the work had likewise been carried out through Company A.

Accordingly, the attorney emphasized that the matter of the plaintiff's unpaid labor costs was solely a matter between Company A and the plaintiff, and that it was improper to hold the client, the original contractor, responsible.

In accordance with the labor law specialist attorney's assistance, the court recognized the following points.

Accordingly, the court rendered a judgment dismissing the plaintiff's claim for 150 million won in labor costs and delay damages.

1. Organization of the Contract Structure and the Party Obligated to Pay Labor Costs

The labor law specialist attorney reviews the contract structure centering on the contracting and subcontracting relationships and clearly organizes who bears the obligation to pay the labor costs.

Through this, the attorney identifies the scope of liability that the client must bear and sets the direction of the defense logic.

2. Comprehensive Response through In-house Labor Attorney Consultation and the Formation of a TF

Where the calculation of labor costs or the method of deploying personnel becomes an issue, the attorney seeks consultation from an in-house labor attorney to organize the issues related to labor costs.

Where the matter is complex, the firm forms a TF of 1 to 20 persons to respond comprehensively, from analysis of the facts and organization of the issues to the establishment of a response strategy.

3. Securing Key Evidence through Collaboration with the In-house Evidence Investigation Center

The firm systematically collects key evidence, such as payment records, settlement statements, and financial materials, in collaboration with the in-house Evidence Investigation Center.

Through this, the firm prepares to objectively prove that the price has already been paid.

4. Establishment of a Strategy and Response at Each Stage of Trial
In the course of submitting the answer and conducting the pleadings after the complaint is received, the firm organizes arguments tailored to the issues and adjusts the response strategy according to the flow of the trial.

Through this, the firm aims to prevent the unnecessary expansion of the dispute and to achieve a stable defense.

🔗legal consultation reservation If you need one, please review your response direction through a consultation with a labor law specialist attorney from the early stage of the case.