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Daejeon court orders ADD to return 2.6 billion won to Hanwha Aerospace

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The Daejeon High Court’s Civil Division 2 ruled that the Agency for Defense Development (ADD) must pay Hanwha Aerospace 2.61276 billion won plus interest, returning part of the late-delivery penalties the company paid after a 2019 explosion at its Daejeon plant. Both the first and second instance courts held Hanwha responsible for the accident, the work stoppage and the delivery delay, but cut the penalty from about 12.02 billion won to about 9.41 billion won. Both sides have appealed to the Supreme Court.

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A South Korean appeals court has ordered the Agency for Defense Development (ADD) to return part of the late-delivery penalties Hanwha Aerospace paid after a 2019 explosion shut down its Daejeon plant. The Daejeon High Court’s Civil Division 2 ruled that ADD must pay Hanwha Aerospace 2.61276 billion won plus interest, Yonhap and the Dong-A Ilbo reported, with Newsis carrying the same headline figure. [ 1 , 2 , 3 ]

The penalties stem from a 14 February 2019 explosion at the Hanwha Aerospace Daejeon site that killed three workers. A work-stop order was issued and lifted in stages over about six months, ending on 14 August 2019, according to Yonhap. Hanwha paid ADD about 12.02 billion won in penalties for delayed deliveries of military goods and sued the agency in March 2024 to recover the money. [ 2 , 3 ]

Hanwha argued that the work-stop order “not only failed to meet the legal requirements of Article 51 of the former Industrial Safety and Health Act but also ran against the principle of proportionality”, and that the delivery delay was not its fault but amounted to force majeure or the responsibility of the government that issued the order, Yonhap reported. The company said the delay fell under a contract clause exempting delays caused by government policy and responsibility. [ 3 ]

Both the first and second instance courts rejected that argument and held Hanwha responsible for the accident, the work stoppage and the delivery delay. The appeals court cited the company’s failure to address workers’ suggestions for equipment improvements and the fact that a May 2018 explosion during solid-fuel casting killed five workers and injured four, nine months before the 2019 blast, Yonhap reported. The court said the accident occurred because the company did not fully carry out industrial accident prevention measures. [ 3 ]

The court did accept that the 12.02 billion won penalty was excessive. It was cut to about 9.62 billion won at first instance and to about 9.41 billion won on appeal. Both Hanwha Aerospace and ADD have appealed to the Supreme Court, Yonhap reported. [ 3 ]

While the appeal was being heard, another explosion occurred in June at the No. 56 building’s washing room at the Daejeon site, killing five workers and injuring two. A special inspection by the Employment and Labor Ministry found 473 violations of the Industrial Safety and Health Act and other rules, and the Daejeon Metropolitan Police Agency has booked employees in the safety management chain on suspicion of professional negligence, according to Yonhap. [ 3 ]

Почему это важно

The ruling leaves a defence contractor bearing most of the cost of delivery delays caused by a fatal workplace accident, while the court rejected the company’s argument that a government work-stop order shifted responsibility to the state. Because both sides have appealed, the final size of the penalty remains open. The documents also tie the case to repeated fatal explosions at the same Daejeon site, which is now the subject of a labour ministry inspection and a police investigation.

Ключевые факты

  • The Daejeon High Court’s Civil Division 2 ruled that ADD must pay Hanwha Aerospace 2.61276 billion won plus interest. [ 1 , 2 , 3 ]
  • An explosion at the Hanwha Aerospace Daejeon plant on 14 February 2019 killed three workers, and a work-stop order was fully lifted on 14 August 2019 about six months later. [ 2 , 3 ]
  • Hanwha Aerospace paid ADD about 12.02 billion won in late-delivery penalties and sued the agency in March 2024 seeking their return. [ 2 , 3 ]
  • The first and second instance courts both found Hanwha responsible for the accident, the work stoppage and the delivery delay. [ 3 ]
  • The penalty was cut to about 9.62 billion won at first instance and to about 9.41 billion won on appeal, the appeals court judging the original amount excessive. [ 3 ]
  • Both Hanwha Aerospace and ADD have filed appeals to the Supreme Court. [ 3 ]
  • A June explosion at the Daejeon site killed five workers and injured two, a labour ministry special inspection found 473 violations, and Daejeon police are investigating employees for professional negligence. [ 3 ]

Подтверждено несколькими источниками

  • An appeals court ordered ADD to return roughly 2.6 billion won of the penalties to Hanwha Aerospace. [ 1 , 2 , 3 ]
  • A 14 February 2019 explosion at the Hanwha Aerospace Daejeon plant killed three workers. [ 2 , 3 ]
  • Hanwha Aerospace filed suit against ADD in March 2024 over about 12.02 billion won in late-delivery penalties. [ 2 , 3 ]

Пока неясно

  • Whether the appeals court ruling will stand. Both Hanwha Aerospace and ADD have filed appeals to the Supreme Court, so the outcome may change.
  • Whether ADD has paid the 2.61276 billion won, or when payment is due. The documents do not say.
  • How the penalty figure was recalculated down to about 9.41 billion won. Only the court’s view that the 12.02 billion won amount was excessive is reported; the calculation is not given.
  • One of the three documents (Newsis) reports the ruling in its headline but its article text covers an unrelated National Assembly audit. Its article text could not be used for this event, so the specifics rest on the other two documents.

Что пишут местные СМИ

Деловые СМИThe two business outlets led on the court’s decision, with the Dong-A Ilbo giving the exact figure of 2.61276 billion won and a summary of the case background, and Newsis flagging the ruling in its headline as requiring Hanwha to be repaid part of the 2019 explosion penalty. [ 1 , 2 ]
Официальные источникиYonhap gave the fullest account, setting out the court’s reasoning that responsibility lay with Hanwha Aerospace, the penalty reductions, the earlier 2018 accident and the June explosion, the labour ministry’s finding of 473 violations and the police investigation. [ 3 ]

Хронология, местное время

  1. Newsis publishes a report on the appeals court ruling. [ 1 ]
  2. The Dong-A Ilbo publishes its report, giving the 2.61276 billion won figure. [ 2 ]
  3. Yonhap publishes its report with the court’s reasoning and background. [ 3 ]
  4. Explosion at the Hanwha Aerospace Daejeon plant kills three workers; a work-stop order is issued. [ 3 ]
  5. All work-stop orders at the site are lifted. [ 3 ]
  6. Hanwha Aerospace sues ADD seeking the return of about 12.02 billion won in late-delivery penalties. [ 2 , 3 ]