Japanese Attorney at Law - Bengoshi L.L.

Qualified attorney (Japan & NY), CIPP/E & CIPP/US, MCIArb, CFE — guiding Japanese corporate law & compliance.

Q: Our Japanese Contractor Couldn't Finish the Project. Are They Entitled to Any Payment for Work Done?

In "work-for-hire" contracts, known in Japan as ukèoi keiyaku (請負契約), a contractor undertakes to complete a specific piece of work—such as constructing a building, developing software, or manufacturing custom goods—and the client (or orderer) agrees to pay remuneration upon the successful completion of that work. A

Q: How are Security Deposits (Shikikin) Handled in Japanese Real Estate Leases Under the Amended Civil Code?

Security deposits, known as shikikin (敷金) in Japan, are a near-universal feature of real estate lease agreements, whether for commercial or residential properties. Tenants typically pay a sum of money to the landlord at the inception of the lease, which the landlord holds as security against potential unpaid rent, damages

Q: What are Our Obligations to Restore a Leased Property in Japan Upon Termination of the Lease? Understanding "Genjō Kaifuku Gimu."

When a commercial or residential lease in Japan comes to an end, one ofคร the most common areas of discussion—and potential dispute—revolves around the condition in which the tenant must return the property. The tenant's responsibility in this regard is known as the "obligation to

Q: If Our Japanese Landlord Sells the Leased Property, What Happens to Our Lease and Security Deposit?

For any business leasing real estate in Japan, the sale of the leased property by the landlord to a new owner can raise immediate and critical questions: Does our lease remain valid against the new owner? Who is now considered our landlord? And, importantly, what happens to the security deposit

Q: We're Considering a Long-Term Real Estate Lease in Japan. What's the New Maximum Duration?

When businesses plan for the long term in Japan, securing premises through real estate leases is often a fundamental step. Whether it's for office space, manufacturing facilities, retail outlets, or land for development, the duration of the lease is a critical factor influencing investment decisions, operational stability, and

Q: How Long Do We Have to Notify a Japanese Seller About Non-Conforming Goods to Preserve Our Claims?

When your business receives goods from a Japanese supplier that turn out to be non-conforming—whether in kind, quality, or quantity—it's not just a matter of identifying the problem. Japanese law, specifically the amended Civil Code effective April 1, 2020, sets out rules regarding how and when

Q: Can We Get a Price Reduction if Goods from Japan are Faulty but We Still Want to Keep Them?

In commercial transactions, receiving goods that don't quite meet the agreed-upon standards is an unfortunate but not uncommon reality. Perhaps the quality isn't what was specified, the kind is slightly different, or the quantity is short. In such situations, outright rejection or demanding a full replacement

Q: If Goods from a Japanese Seller are Non-Conforming, Can We Demand Repair or Replacement (Cure)?

When your business purchases goods from a supplier in Japan and those goods subsequently turn out to be defective, of the wrong type, or in insufficient quantity, this naturally leads to the question of remedies. Under the significantly amended Japanese Civil Code, effective April 1, 2020, which revamped the seller&

Q: What Happens if Goods Purchased from a Japanese Supplier Don't Meet Specifications? Understanding "Non-Conformity" Liability.

When businesses procure goods, an essential expectation is that the items received will match the agreed-upon specifications, quality standards, and quantity. However, discrepancies can occur, leading to disputes and potential losses. If you've purchased goods from a Japanese supplier and they don't meet the contractual requirements,

Q: We Use Standard Terms and Conditions for Our Business in Japan. How Does the Amended Civil Code Affect Their Enforceability?

Standard terms and conditions, known in Japanese as teikei yakkan (定型約款), are ubiquitous in modern commerce. They are sets of pre-drafted clauses prepared by one party (typically a business) to apply uniformly to a large number of similar transactions with various counterparties (often consumers or other businesses). Their use promotes

Q: Our Japanese Counterparty's Claim Against Us Was Assigned/Attached. Can We Still Set Off Our Claim Against Them?

The right of set-off, known as sōsai (相殺) in Japanese, is a fundamental commercial mechanism allowing parties who have mutual debts to extinguish them by offsetting corresponding amounts. This not only simplifies payment procedures but also serves as a crucial form of de facto security – a party holding a claim

Q: If We Pay a Debt on Behalf of a Japanese Company, Can We Step into the Original Creditor's Shoes? Understanding Subrogation by Performance.

When a company or individual makes a payment to a creditor on behalf of a debtor—whether as a guarantor, a co-obligor, or even as a seemingly unrelated third party—Japanese law provides a mechanism that may allow the performing party to "step into the shoes" of the

Q: Our Japanese Debtor Offered Property Instead of Cash to Settle a Debt. How Has the Law on "Daibutsu Bensai" (Accord and Satisfaction) Changed?

In commercial dealings, it's not uncommon for a debtor facing cash flow issues to offer an asset other than money to satisfy an existing monetary debt. This could involve transferring real estate, goods, or other property rights. In Japan, this practice is known as daibutsu-bensai (代物弁済), which translates

Q: Someone Else Offered to Pay Our Japanese Debtor's Debt. What are the Rules for Third-Party Payments Under the Amended Japanese Civil Code?

It's not uncommon in business dealings for a party other than the primary debtor to offer to settle an outstanding obligation. This third party could be a guarantor, an affiliated company, a business partner with a vested interest in the debtor's solvency, or various other entities.

Q: Can We Transfer Our Entire Contractual Position (Rights and Obligations) to Another Company in Japan?

In the dynamic world of business, companies often need the flexibility to transfer their entire contractual standing—encompassing all associated rights, obligations, and procedural powers—to another entity. This can be crucial during mergers, acquisitions, corporate reorganizations, or when a business decides to divest a particular line of operation. In

Q: A Third Party in Japan Wants to Take Over Our Debtor's Obligations. How Does the New Civil Code Regulate "Assumption of Obligations"?

In the course of business, situations frequently arise where a third party steps in to take responsibility for the debts or contractual obligations of an existing debtor. This process, known as "assumption of obligation" or saimu hikiuke (債務引受) in Japanese, can occur for various reasons, such as corporate

Q: Can We Secure Financing in Japan by Assigning Future Receivables? Validity and Perfection Requirements Under the Amended Japanese Civil Code.

For businesses seeking flexible financing options, the ability to assign future receivables—claims for payment that are expected to arise from ongoing or even anticipated contractual relationships—is a valuable tool. This practice allows companies to leverage their anticipated revenue streams to obtain working capital or secure loans. In Japan,

Q: Our Contract with a Japanese Company Prohibits Assigning Claims. Is This Enforceable Under the Amended Japanese Civil Code?

Anti-assignment clauses, often referred to as jōto seigen tokuyaku in Japanese, are common in commercial contracts worldwide. These clauses aim to restrict or outright prohibit a party from assigning its contractual rights (typically the right to receive payment or other performance) to a third party. For a long time in

Q: Multiple Parties Owe Us Money in Japan: How Does the Amended Civil Code Affect "Joint and Several" Liability Claims?

When commercial transactions involve multiple parties on one side of an obligation—either several entities owing a debt or several entities entitled to a claim—the legal framework governing their respective rights and liabilities becomes crucial. In Japan, the Civil Code, significantly amended effective April 1, 2020, provides the rules

Q: Can a Creditor Directly Collect from a Debtor's Debtor in Japan? Understanding the Amended Creditor's Subrogation Right.

When a debtor fails to exercise their own rights against a third party, thereby impairing their ability to satisfy their obligations to their own creditor, Japanese law provides a mechanism known as the creditor's subrogation right (saikensha daii-ken). This allows a creditor, under certain conditions, to step into

Q: My Japanese Business Partner Seems to Be Hiding Assets to Avoid Paying Debts. What Can I Do Under the Amended Japanese Civil Code?

When a business partner in Japan takes actions that appear designed to improperly shield assets from creditors, it can leave you in a precarious position. The Japanese Civil Code, particularly after its significant amendments effective April 1, 2020, provides a specific remedy for such situations: the right to demand the

Insurer's Dilemma: Rescinding a Life Policy When the Company Policyholder Has No One to Notify – A 1997 Japanese Supreme Court Solution

Judgment Date: June 17, 1997 Court: Supreme Court, Third Petty Bench Case Name: Claim for Transferred Receivables Case Case Number: Heisei 7 (O) No. 949 of 1995 Introduction: The Complexities of Policy Rescission and Corporate Representation An insurer's right to rescind an insurance policy, particularly a life insurance

Age Misstatements in Life Insurance: A 1938 Japanese Apex Court Ruling on Insurer Negligence and Policy Voidance

Judgment Date: March 18, 1938 Court: Daishin-in (Great Court of Cassation), Second Civil Department Case Name: Insurance Claim Case Case Number: Showa 12 (O) No. 2067 of 1937 Introduction: The Critical Importance of Age in Life Insurance The age of the individual whose life is to be insured is a

The Doctor's Duty: A 1912 Japanese Apex Court Ruling on Examining Physician Negligence and Life Insurance Disclosure

Judgment Date: May 15, 1912 Court: Daishin-in (Great Court of Cassation), Second Civil Department Case Name: Claim for Insurance Money Case Number: Meiji 45 (O) No. 46 of 1912 Introduction: The Delicate Balance of Disclosure in Life Insurance The foundation of any life insurance contract rests upon the principle of

A Solicitor's Knowledge vs. Company's Awareness: A 1934 Japanese Apex Court Ruling on Disclosure in Life Insurance

Judgment Date: October 30, 1934 Court: Daishin-in (Great Court of Cassation), Second Civil Department Case Name: Insurance Claim Case Case Number: Showa 9 (O) No. 1548 of 1934 Introduction: The Vital Importance of Disclosure in Life Insurance Contracts Life insurance contracts are built on a foundation of trust and transparency,