CONTRACTS FOR SERVICES
I. Service Contracts under the 2015 Civil Code
The 2015 Civil Code provides a comprehensive legal framework for the conclusion, performance, and resolution of disputes related to service contracts. Article 513 of the Code defines a service contract as an agreement between parties whereby one party undertakes to perform a job for the other, and the other party is obligated to pay remuneration for the services rendered. This concept broadly covers a range of service activities, from everyday services like repair and maintenance to more complex services such as legal, financial, or managerial consultations.
The execution of service contracts must adhere to the fundamental principles of civil law, including freedom, equality, good faith, cooperation, and compliance with legal regulations and social ethics. Once agreed upon by the parties, a service contract becomes binding and enforceable by law.
II. Fundamental Contents of a Service Contract
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A valid service contract must include the following fundamental elements: information about the contracting parties, the scope of work, the term of performance, the contract value, the payment method, the rights and obligations of the parties, clauses on penalties for breaches and compensation for damages, and conditions for amending, supplementing, or terminating the contract.
In a service contract, the scope of work that the service provider is required to perform is the most crucial aspect. This work must be clearly and specifically described to ensure that the service recipient can monitor and evaluate the quality of the service provider’s performance. The contract’s term must also be clearly defined to protect the rights of the service recipient while ensuring the obligations of the service provider.
The payment method in a service contract must be agreed upon in detail by the parties, including the timing of payment, transfer methods, currency, and payment conditions. This helps to avoid disputes related to payment and ensures transparency and clarity throughout the execution of the service contract.
III. Rights and obligations of the parties in the service contract
| Clients | Service providers | |
| Obligation | Supply the service provider with the information, documentation and facilities necessary for the performance of the act if so agreed or required for the performance of the act.
Pay a fee to the service provider as agreed. |
Perform the act strictly in accordance with the agreement on quality, quantity, time, location and other matters.
Do not assign the act to another person for performance on its behalf without the consent of the client. Take care of, and return to the client after completion of the act, the documents and facilities provided to it. Notify the client promptly of any inadequacy in the information or documents and any failure of the facilities to satisfy the quality required for the completion of the act. Keep confidential any information of which it has had knowledge during the period of providing the service as agreed or as provided by law. Compensate the client for damage where the service provider causes any loss of or damage to the documents or facilities supplied or discloses confidential information. |
| Rights | Require the service provider to perform the act strictly in accordance with the agreement on quality, quantity, time, location and other matters.
Where a service provider commits a serious breach of its obligations, the client may terminate the performance of the contract and demand compensation for damage. |
Require the client to provide information, documents and facilities.
Amend the terms of service in the interests of the client without necessarily asking for the opinion of the client where waiting for such opinion would cause damage to the client provided that the service provider promptly informs the client thereof. Require the client to pay the fee. |
IV. Conditions for the Validity of a Service Contract
To be legally valid, a service contract must meet the conditions prescribed by the 2015 Civil Code. First, the contract must be lawfully concluded between parties with full civil legal capacity, who voluntarily participate without deception or coercion. Second, the contract’s content must not violate legal regulations or contravene social ethics. Third, the contract’s form must comply with legal requirements and may be in writing, orally, or through specific actions, as agreed upon by the parties.
A service contract may terminate when the work has been completed, the contract term has expired, or the parties agree to terminate it early. In cases where one party seriously breaches the contract’s obligations, the other party has the right to unilaterally terminate the contract and claim compensation for damages.
V. Cases for Amending, Supplementing, or Terminating a Service Contract
Under the 2015 Civil Code, the parties to a service contract may amend, supplement, or terminate the contract upon mutual agreement or based on clear legal grounds. Amendments or supplements to the contract must be carried out with the consent of both parties and in compliance with the Civil Code’s provisions on contracts. If one party unilaterally amends or supplements the contract without the other party’s consent, such changes will not have legal validity.
The termination of a service contract may also occur due to a serious breach of agreed terms or when the contract cannot be performed due to unforeseen objective circumstances beyond the parties’ control.
VI. Legal Liability for Breaching a Service Contract
When one party breaches the terms of a service contract, the other party has the right to claim compensation for damages or penalties for the breach. According to the 2015 Civil Code, the penalty amount is determined by mutual agreement between the parties but must not exceed the maximum limit prescribed by law. Furthermore, the breaching party must compensate the other party for all resulting damages, including material losses and emotional distress.
VII. About Us, Hankuk Law Firm
■ Hankuk Law Firm – Introduction
The goal of the legal services provided by HANKUK LAW FIRM is to support businesses, investors, and people. Our organization employs skilled Korean lawyers, partners, and professionals to provide legal services to businesses related to corporations and litigation.
To support the startup process, our lawyers and staff provide a wide range of services, including business law consulting, tax and immigration law consulting, real estate services, business consulting, marketing and communications, human resources, product distribution, franchise options, etc. We provide expert advice on every aspect of your business needs.
To protect the legitimate rights and interests of our clients and achieve the best results, we provide legal advice and participate in civil lawsuits related to business, labor, marriage, family, and inheritance.
■ Contact us now
For reliable and effective legal advice, please contact HANKUK LAW FIRM now. We are committed to providing you with the best possible answers and our team of experienced lawyers has extensive knowledge in many legal fields. We are always here to provide the most competent and dedicated support, whether you are dealing with contractual issues, commercial disputes or need guidance on foreign investment. HANKUK LAW FIRM is honored to have assisted hundreds of domestic and international clients in skillfully resolving complex legal issues as their trusted legal partner. Do not let legal issues hinder your success. Let us accompany you towards legal achievement and comfort. For prompt guidance and support to ensure your rights are always maintained at the highest standards, contact HANKUK LAW FIRM now.
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