SOUTH KOREA Law and Practice Contributed by: Jin Yeong Chung, Inhak Lee and Seung Hyeon Lee, Kim & Chang
3. Initiating a Lawsuit 3.1 Rules on Pre-Action Conduct In general, there are no pre-action procedures in place in Korea. However, in certain proceedings, there are pre-con- ditions for filing a lawsuit that must be met in accord- ance with the relevant provisions of the law. Examples are as follows: • when initiating a class action relating to securities, the representative plaintiff must obtain the permis- sion from a court in advance; and • in order to file a tax revocation lawsuit, the plaintiff must exhaust their remedies by undergoing a tax administrative trial. 3.2 Statutes of Limitations The general statute of limitations under the Korean Civil Code is ten years. A shorter period applies to claims arising out of commercial transactions in accordance with the Korean Commercial Code, which is, in principle, five years. In addition, the Korean Civil Code, the Korean Commercial Code and other special laws stipulate the special statute of limitations appli- cable to certain types of claims. The statute of limitation starts on the day immediately following the date the claim could have been exer- cised (namely, the due date of each account receiv- able or, if the due date is not decided in advance, the day the obligation accrued). For claims regarding breach of agreements, the statute of limitation starts to run from the date of such breach. Tort claims must be brought within the following peri- ods (whichever ends earlier): • within ten years from the date the tort was commit- ted; and • within three years from the date the claimant becomes aware of damages suffered and the iden- tity of the tortfeasor.
3.3 Jurisdictional Requirements for a Defendant
The Act on Private International Law (the “Act”) applies when there is a question of whether a Korean court may exercise jurisdiction over a dispute that involves a foreign party or a subject located outside Korea. Under the aforementioned statute, a Korean court has jurisdiction over a dispute when either party or the dispute itself has “substantial nexus” with Korea. When determining whether there is such nexus, the court shall consider, among others, fairness and judi- cial economy. According to the Act, a Korean court has jurisdiction under the following circumstances: • when either party is domiciled or has residence in Korea; • when either party has a principal place of business or operations in Korea, or was established or incor- porated under the laws of Korea; • when either party has a place of business in Korea and the subject of the dispute relates to such busi- ness; • when either party engages in continuous and organised business activities in Korea and the dis- pute relates to such business activities; or • when the subject of the dispute is assets located in Korea, or the defendant’s assets with respect to which the plaintiff may seek an attachment are located in Korea. Furthermore, if a court has jurisdiction over any one claim among multiple claims asserted in a dispute or has jurisdiction over any one party among multiple parties to a dispute, the court may exercise jurisdic- tion over the entire dispute in certain circumstances. Even if none of the above conditions is met, unless the case involves an issue for which certain speci- fied courts have exclusive jurisdiction (eg, the cases involving certain corporate matters for which only the local court has jurisdiction), then jurisdiction can be recognised in the following cases: • if the parties have agreed to the jurisdiction of the district court in writing; or
1028 CHAMBERS.COM
Powered by FlippingBook