Court: "Korean Air has no debt to Defense Acquisition Program Administration for 'Reconnaissance Drone Delivery Delay'"

Korean Air partially won a lawsuit against the Defense Acquisition Program Administration (DAPA), claiming no liability for compensation related to delays in the delivery of reconnaissance unmanned aerial vehicles (UAVs).

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The Civil Division 23 of the Seoul Central District Court (Presiding Judge Kim Dong-bin) ruled on the 5th that Korean Air does not owe delay damages in the lawsuit seeking confirmation of non-existence of debt for delay damages related to the initial mass production project of reconnaissance UAVs filed against DAPA.

The court also ordered DAPA to return 40.45 billion KRW out of the 65.85 billion KRW deducted from the payment to Korean Air. It recognized only 25.4 billion KRW in delay damages, which is about 10% of the contract amount.

In December 2015, Korean Air signed a contract with DAPA to deliver a total of 16 sets of reconnaissance UAVs for the initial mass production project. When delivery was delayed due to design changes and other reasons, DAPA claimed that Korean Air was responsible for the delay and demanded delay damages of 208.1 billion KRW.

Korean Air filed a lawsuit in April 2021, arguing that the delay damages were unfair. They claimed that DAPA unilaterally requested specification changes, making it impossible to proceed with mass production based on finalized drawings, which caused the delay in contract fulfillment.

In April 2023, DAPA filed a counterclaim demanding 156.3 billion KRW, offsetting other project payment claims against the original delay damages, but the court dismissed this counterclaim on the day of the ruling.

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