DAPA Loses 714.7 Billion KRW in Lawsuits Over 6 Years, 608 Billion KRW Paid to Law Firms... Number of Lawsuits Increasing Annually

Published 14 Oct.2024 14:20(KST)

"Defense Acquisition Program Administration Shifts Lawsuit Liability to Private Sector, Serious Public Fund Waste from Lost Amounts"

Over the past six years, the Defense Acquisition Program Administration (DAPA) has lost lawsuits amounting to 714.762 billion KRW, of which the loss amount for lawsuits delegated to the private sector reached 608.014 billion KRW. It has been pointed out that DAPA delegates cases with large claim amounts to the private sector, and due to the low winning rate in these lawsuits, public tax money is being wasted on loss payments.

According to data submitted by DAPA to Rep. Heo Young of the National Defense Committee of the National Assembly on the 13th, the annual lawsuit loss amounts over the past six years were △2019: 107.687 billion KRW △2020: 45.867 billion KRW △2021: 186.046 billion KRW △2022: 89.95 billion KRW △2023: 277.792 billion KRW △as of June 2024: 7.06 billion KRW.

[Image source=Beomryul Newspaper]

The number of lawsuits handled by DAPA is also increasing. Over the past five years, the number of lawsuits conducted by DAPA were △2019: 40 cases △2020: 32 cases △2021: 38 cases △2022: 40 cases △2023: 44 cases, showing an upward trend.

By lawsuit type, payment for goods was the most common with 32 cases, followed by 30 cases of damages claims, 11 cases of judicial confirmation claims to suspend the statute of limitations, 10 cases of claims for the return of unjust enrichment, and 10 cases of claims for confirmation of non-existence of debt, totaling 133 finalized judgments.

According to Article 13 of DAPA’s Legal Affairs Operation Regulations, when the claim amount is large or when the importance, difficulty, or complexity of the case is recognized as necessary, external lawyers may be appointed as litigation agents through delegation to the private sector. However, it was found that the loss amount for lawsuits delegated to the private sector accounted for 85% of the total loss amount, reaching 608.014 billion KRW.

Among the 211 lawsuits conducted by DAPA over the past six years, 48 were delegated to the private sector or the Government Legal Service Corporation. The winning or partial winning rate for lawsuits directly handled by DAPA was 61.3%, whereas the winning or partial winning rate for delegated lawsuits was only 25%.

The lawsuit with the largest loss amount was a claim for confirmation of non-existence of debt against SNT Motive in 2020, delegated to the law firm Pyeongan (lead attorney Ju Sang-yong), with a loss amount of approximately 150.49366 billion KRW.

Rep. Heo Young stated, "DAPA delegates cases with large claim amounts to the private sector, shifting responsibility for losses to them, while wasting public tax money on loss payments amounting to hundreds of billions of won. DAPA must actively conduct mediation with defense contractors through the formation of consultative bodies to reduce the increasing number of lawsuits each year and prevent loss payments."