How to Claim a Legally Reserved Share (Iryūbun) in Japan: The Process for Seeking Monetary Compensation

Japanese Attorney at Law - Bengoshi L.L.

• 7 min read

In Japanese inheritance law, the concept of iryūbun (遺留分), or the "legally reserved share," serves as a vital safeguard for certain close family members. It ensures that even if a decedent's will (igon - 遺言) or substantial lifetime gifts (zōyo - 贈与) attempt to distribute their estate primarily to others, these designated heirs are entitled to a minimum portion. When these iryūbun rights are infringed, the entitled heirs have a specific legal recourse. Significantly, major reforms to the Japanese Civil Code, effective from July 1, 2019, fundamentally changed the nature of this recourse, transforming it from a claim to recover specific property into a right to claim monetary compensation. This article outlines the process for claiming this legally reserved share under the current Japanese legal framework.

I. Understanding Iryūbun Infringement: When Does a Claim Arise?

Before delving into the claim process, it's essential to understand when an iryūbun infringement occurs. This involves three key steps:

  1. Identifying Iryūbun Holders and Their Respective Shares: As detailed in a previous discussion, iryūbun rights are granted to the decedent's surviving spouse, children (including their representatives by daishū sōzoku - 代襲相続), and lineal ascendants (if they are statutory heirs). Siblings of the decedent are excluded. The total iryūbun pool is either 1/2 or 1/3 of the base estate, depending on the category of heirs, and this pool is then divided among the iryūbun holders according to their statutory inheritance proportions.
  2. Calculating the Base Estate for Iryūbun: The iryūbun is not calculated solely on the assets owned by the decedent at death. Certain lifetime gifts made by the decedent are added back, and all of the decedent's debts are deducted. Under the reformed Civil Code (Article 1044):
    • Gifts to Heirs (Special Benefits): Gifts made to presumptive heirs that qualify as "special benefits" (for marriage, livelihood capital, etc.) within ten years prior to the inheritance are generally added back.
    • Gifts to Non-Heirs: Gifts made to non-heirs within one year prior to the inheritance are added back.
    • Gifts Made with Knowledge of Infringement: Gifts to non-heirs made more than one year prior, or gifts to heirs made more than ten years prior, can still be added back if both the donor (decedent) and the donee knew at the time that the gift would infringe upon the iryūbun rights of other heirs.
    • Valuation: The value of these added-back gifts is generally determined as of the time of the commencement of inheritance.
  3. Identifying Infringement: An iryūbun infringement occurs when the net value an iryūbun holder is entitled to receive from the decedent's estate (through inheritance, testamentary gifts, or qualifying lifetime gifts already treated as advancements) is less than their calculated iryūbun amount. The shortfall is the amount of the infringement.

II. The Modern Iryūbun Claim: A Right to Monetary Compensation (遺留分侵害額請求権 - Iryūbun Shingai-gaku Seikyū-ken) (Article 1046, Civil Code)

The most significant change introduced by the 2018/2019 reforms is the nature of the iryūbun claim itself.

A. The Fundamental Shift from Property Restitution

  • Previous System (Pre-July 2019): Under the old law, an iryūbun holder whose rights were infringed had a "right of abatement" (gensai seikyū-ken - 減殺請求権). This was a "right to form" (keiseiken - 形成権), meaning its exercise directly altered property rights, aiming to recover the actual property (or a share of it) that had been excessively gifted or bequeathed (genbutsu kaifuku - 現物回復). This often led to complex co-ownership situations and could disrupt transactions involving the property.
  • New System (Article 1046, effective July 1, 2019): The reformed law replaces this with a right to claim monetary compensation for the value of the iryūbun infringement. The iryūbun holder no longer has an automatic right to reclaim the specific assets. Instead, they are entitled to demand a sum of money from those who received the property through infringing testamentary gifts, universal testamentary gifts (hōkatsu izō - 包括遺贈), or lifetime gifts.

B. Rationale for the Change

This transformation to a monetary claim system was implemented to:

  • Simplify Disputes: Avoid the practical difficulties of dividing or co-owning specific assets, especially indivisible property like real estate.
  • Protect Transferees and Transactional Security: Provide greater certainty for those who received gifts or bequests, as they are no longer at risk of having the property itself reclaimed by iryūbun holders, provided they satisfy the monetary claim.
  • Facilitate More Flexible Settlements: Monetary claims are generally easier to quantify, negotiate, and settle.

C. Calculating the Monetary Claim Amount

The amount of monetary compensation the iryūbun holder can claim is the value of their infringed iryūbun. This is calculated as:
(The iryūbun holder's legally calculated iryūbun amount based on the constructive estate)
MINUS
(The value of any assets the iryūbun holder actually received or is entitled to receive from the decedent's estate, plus the value of any special benefits they received that are already factored into their inheritance share calculation).

Interest on this monetary claim typically accrues from the date the claim is made (Article 1047(1)).

III. The Process of Claiming Monetary Compensation for Iryūbun Infringement

Claiming iryūbun involves several steps, ideally starting with out-of-court actions.

A. Initial Step: Notification of Intent to Claim (意思表示 - Ishi Hyōji)

The iryūbun holder must first express their intention to exercise their right to claim monetary compensation to the person(s) who received the infringing dispositions (the donees or legatees).

  • Form of Notification: While no specific legal form is mandated for this initial notification, it is strongly advisable to make this demand in writing, for example, by a registered mail with certification of contents (内容証明郵便 - naiyō shōmei yūbin), to create a clear record of when the claim was made. This is important for proving compliance with the statute of limitations.
  • Content: The notification should clearly state that the claimant is an iryūbun holder, that their iryūbun has been infringed by specific gifts or bequests received by the respondent, and that they are claiming monetary compensation for the amount of the infringement.

B. Negotiation and Agreement

Once the claim is made, the parties (the iryūbun claimant and the recipient(s) of the infringing dispositions) can enter into negotiations to reach an agreement on the amount of compensation and the terms of payment. If a settlement is reached, it is advisable to document it in a formal written agreement.

C. Mediation or Litigation

If out-of-court negotiations fail, the iryūbun holder may need to pursue formal legal action:

  • Family Court Conciliation (家事調停 - Kaji Chōtei): While the iryūbun monetary claim is a civil monetary claim, disputes concerning it often arise in the context of broader inheritance disputes. Therefore, it is common for parties to first attempt to resolve the iryūbun claim through conciliation at the Family Court as part of overall estate discussions.
  • Civil Litigation (訴訟 - Soshō): If conciliation is unsuccessful, the iryūbun holder can file a lawsuit in the District Court (or Summary Court, depending on the amount claimed) to demand payment of the monetary compensation. The court will then adjudicate whether an infringement occurred and determine the amount of compensation due.

IV. Order of Abatement: Determining Liability Among Multiple Recipients (Article 1047, Civil Code)

If multiple testamentary gifts, universal testamentary gifts, and/or lifetime gifts have infringed upon the iryūbun, the law establishes a specific order in which these dispositions become liable to satisfy the monetary claim:

  1. Testamentary Gifts (Izō) and Universal Testamentary Gifts (Hōkatsu Izō) First: These abate (become liable for payment) before lifetime gifts. If there are multiple testamentary gifts/universal testamentary gifts, they abate proportionally to their respective values (Article 1047(1)(i)). The testator can, however, express a different order of abatement among these testamentary dispositions in their will (Article 1047(2)).
  2. Lifetime Gifts (Zōyo) Second (Reverse Chronological Order): If the value of testamentary gifts is insufficient to cover the full iryūbun infringement claim, then lifetime gifts that were added back to the iryūbun base estate become liable. Among multiple such lifetime gifts, the most recent gift abates first, followed by the next most recent, and so on, until the iryūbun claim is satisfied (Article 1047(1)(ii)).

V. Options for the Recipient of an Infringing Disposition

The recipient of a gift or bequest that infringes upon an iryūbun is primarily obligated to pay monetary compensation. However, there are some nuances:

  1. Monetary Payment: This is the default obligation.
  2. Option to Return Property in Lieu of Monetary Payment (価額による弁償 - Kagaku ni yoru Benshō): The recipient (debtor) can choose to satisfy their monetary obligation by transferring the actual property (or a share of it) that they received through the infringing gift or bequest, instead of paying cash. However, this is subject to limitations; for example, if only part of an indivisible asset (like land) is needed to satisfy the claim, the return of a share resulting in co-ownership might require the iryūbun claimant's consent (Article 1047(4), though the mechanics can be complex and may involve further agreement or court intervention if division is impractical).
  3. Grace Period for Payment (Article 1047(5)): Upon the request of the recipient (debtor), the court can grant a reasonable grace period for the payment of the monetary compensation due to the iryūbun holder. This considers the potential hardship on the recipient if immediate full payment is demanded, especially if the received asset is illiquid.

VI. Crucial Time Limits: Statute of Limitations (消滅時効 - Shōmetsu Jikō) (Article 1048, Civil Code)

The right to claim monetary compensation for iryūbun infringement is subject to strict statutes of limitation:

  1. The One-Year Knowledge-Based Period: The claim is extinguished by prescription if not exercised within one year from the time the iryūbun holder becomes aware of:
    • The commencement of inheritance (i.e., the decedent's death), AND
    • The existence of the gifts or testamentary gifts that infringe upon their iryūbun.
      This one-year period starts from the point when the claimant has knowledge of both these elements.
  2. The Ten-Year Absolute Period: Regardless of the claimant's knowledge, the right to claim iryūbun monetary compensation is completely extinguished if not exercised within ten years from the commencement of inheritance.

These are relatively short periods, and failure to act within these deadlines will result in the loss of the right to claim. Therefore, prompt legal advice and action are crucial for iryūbun holders who believe their rights may have been infringed.

VII. Conclusion

Claiming a legally reserved share (iryūbun) in Japan is a right designed to ensure fundamental fairness in inheritance for close family members. The 2018/2019 reforms to the Civil Code have significantly reshaped this process by establishing the claim as one for monetary compensation rather than for the direct restitution of property. This modernization aims to simplify disputes, protect transactional stability, and offer more flexible solutions. Potential claimants must understand the basis of their entitlement, the method of calculating the infringement, the proper procedures for asserting their claim (starting with notification to the recipients), the order in which infringing dispositions become liable, and, critically, the strict statutes of limitation. Navigating iryūbun claims effectively often requires careful legal analysis and timely action to protect these important statutory rights.