Prescription Rules of the Principles of European Contract Law, Part 3 -Its Implications for the Korean Civil Law-

This article deals with the provisions on extinctive prescription (Chap. 14) of the Principles of European Contract Law (PECL III), which was published in March 2003 as one of possible frameworks for a future Draft European Civil Code. It is made of two parts. One is the summary of the prescription rules of PECL III with its underlying policy considerations, and the other is evaluation from the viewpoint of a Korean civilist, specially in terms of the revision work on the Korean Civil Code (KCC) now in process. An important feature of the rules in Chap. 14 of PECL III is that the prescription regime is very streamlined compared to that existing in many European systems. In particular, there is only one period of prescription (3 years) for all claims, except those based on judgement (10 years)(Arts. 14:201, 14:202). The hardship which this short general prescription period may cause to the creditors, who are barred by prescription although able, even after the lapse of many years, to establish the claim, should be counterbalanced by applying the discoverability criterion for the running of the prescription period. So Art. 14:301 of PECL III provides that the running of the period of prescription is suspended as long as the creditor does not know of and could not reasonably know of the identity of the debtor and the facts giving rise to the claim. It is because unless the creditor has previously had a fair chance of pursuing the claim, prescription, which can effectively amount to an act of expropriation for the general interest..