"Joint and Several Claims" (連帯債権) in Japan: A New Concept? How Can Multiple Creditors Claim the Entirety of a Divisible Debt?

Japanese Attorney at Law - Bengoshi L.L.

31 May 2025 • 8 min read

When a single, divisible debt is owed to multiple creditors, the default rule under Japanese law—similar to many other jurisdictions—is that of "divisible claims" (分割債権, bunkatsu saiken). In such cases, each creditor can typically only demand their respective share of the debt from the obligor. However, Japanese law also provides for a scenario where multiple creditors can collectively hold a right to the entirety of a divisible performance, with each creditor empowered to claim the whole amount on behalf of all. This arrangement is known as a "joint and several claim" (連帯債権, rentai saiken).

While the underlying concept isn't entirely new to Japanese legal thought, its explicit and detailed regulation within the Japanese Civil Code is a feature of the Code's recent modernization (effective April 2020), bringing greater clarity to this area. This article explores the nature, formation, and implications of joint and several claims in Japan.

What is a Joint and Several Claim? (Article 432 of the Civil Code)

A joint and several claim arises when multiple creditors are entitled to a single performance from a debtor, and the performance is, by its nature, divisible (e.g., a monetary payment, delivery of a certain quantity of fungible goods). The "joint and several" character of such a claim means that:

Each joint and several creditor is entitled to demand the entire performance (or any part thereof) from the debtor for the benefit of all the creditors.
The debtor can render the entire performance (or any part thereof) to any one of the joint and several creditors and, to the extent of the performance, be discharged from their obligation towards all the creditors.

This is stipulated in Article 432 of the Japanese Civil Code. It provides a mechanism for collective creditor action while offering the debtor a straightforward way to discharge their debt.

Distinguishing from Indivisible Claims and Divisible Claims

Divisible Claims (分割債権, Bunkatsu Saiken): This is the default for multiple creditors of a divisible debt if no joint and several arrangement (or indivisible character by nature) exists. Each creditor only has a right to their pro-rata share.
Indivisible Claims (不可分債権, Fukabun Saiken): These involve a performance that is indivisible by its nature (e.g., delivery of a specific, unique painting). While the external effects (creditor demanding performance, debtor performing to one) are very similar to joint and several claims, their basis is the indivisible nature of the performance itself, not necessarily an agreement for joint and several rights to a divisible performance. The modernized Civil Code has moved away from allowing divisible performances to be made "indivisible by declaration"; such scenarios where collective entitlement to a divisible performance is desired are now more appropriately structured as joint and several claims.

Formation of Joint and Several Claims

Joint and several claims can come into existence through two primary channels:

By Agreement (法律行為, hōritsu kōi):
The most common way is through an explicit agreement between the parties. This could be an agreement between the original creditor and debtor stipulating that multiple named beneficiaries will have joint and several rights, or an agreement among multiple co-creditors and the debtor establishing their collective claim as joint and several.
For instance, if several individuals jointly invest in a project and the return on investment is a single monetary sum, they might agree with the payor that their claim for this sum is joint and several. Similarly, if multiple parties are co-lessors of a property, they might agree with the lessee that the claim for rent is a joint and several claim.
By Operation of Law (法律の規定, hōritsu no kitei):
Certain statutory provisions can give rise to joint and several claims. Legal commentators point to examples such as:
- The right of a principal and an agent against a sub-agent under certain circumstances (referencing Article 107, Paragraph 2 of the Civil Code concerning the principal's direct rights against a sub-agent appointed with consent).
- The rights of an original lessor and a sub-lessor against a sub-lessee for rent or other obligations under specific conditions (referencing Article 613 of the Civil Code concerning the original lessor's direct rights against a sub-lessee).
- It has also been suggested that when multiple assignees of the same claim perfect their assignments simultaneously (or when the order of arrival of notices is unclear and treated as simultaneous), their resulting claims against the debtor could be characterized as joint and several.
- Further, if co-owners of a property jointly purchase an item and later have a claim for damages due to defects in that item, their claim against the seller might be considered joint and several.

External Effects: The Debtor-Creditor Dynamic

The core external effects are defined by Article 432:

Demand by One Creditor: Any joint and several creditor can initiate action (including litigation) to demand the full performance from the debtor. This demand is made "for the benefit of all creditors." This power of one creditor to act for the whole group has an "absolute effect" (絶対的効力, zettaiteki kōryoku), meaning its legal consequences (like interrupting prescription for the claim if it were to apply to the demand itself, or putting the debtor in default) can extend to the entire claim.
Performance to One Creditor: The debtor is fully discharged from their obligation to all joint and several creditors to the extent they render performance to any single one of them. This provides the debtor with a clear and convenient method of discharge without needing to deal with each creditor individually for their respective shares. This, too, has an absolute effect.

Impact of Events Affecting One Creditor on Others

While the ability of one creditor to demand and receive full performance has an absolute effect, the modernized Civil Code provides more nuanced rules for other events affecting only one of several joint and several creditors. The general starting point is the principle of relative effect (相対的効力の原則, sōtaiteki kōryoku no gensoku) laid out in Article 435-2: unless otherwise provided by law, an act performed by one joint and several creditor, or an event that occurs with respect to only one of them, does not affect the other joint and several creditors. However, there are important statutory exceptions:

Novation or Release by One Creditor (更改・免除, kōkai / menjo - Article 433):
If one joint and several creditor enters into a novation agreement with the debtor (extinguishing the old joint and several claim and creating a new one in its place) or releases the debtor from the obligation, this action extinguishes the joint and several claim only to the extent of the share of the benefit that would have been distributable to that particular creditor if they had not lost their right through novation or release. The other joint and several creditors remain entitled to claim the remaining portion of the debt from the debtor.
- Rationale: This rule differs from the treatment of novation or release in joint and several obligations. For divisible claims, if one creditor's action were to extinguish the entire claim or have no effect on what others can claim, it could lead to cumbersome circular reimbursements. The current rule allows the debtor to be partially discharged vis-à-vis the collective, reflecting the acting creditor's disposition of their own internal share.
Set-off by the Debtor (相殺, sōsai - Article 434):
If the debtor has a separate, mutual claim against one of the joint and several creditors, and the debtor validly exercises their right to set off this claim against the joint and several claim, the set-off is effective against all the joint and several creditors. The joint and several claim is extinguished for everyone to the extent of the set-off. This has an absolute effect.
- Rationale: This is seen as fair to the debtor, who has a legitimate expectation of using their claim against one of the collective creditors to reduce the collective debt. It's treated akin to payment. The risk that the creditor against whom the set-off was effected might be unable to account for this benefit internally to the other co-creditors is generally borne by the co-creditors themselves.
Set-off by One Creditor against the Debtor:
While Article 434 explicitly addresses set-off by the debtor, it is generally understood that if one joint and several creditor has a separate debt owed to the debtor and uses the joint and several claim (as the active claim) to set off their personal debt to the debtor, this also extinguishes the joint and several claim for all creditors to that extent. This ensures consistency and achieves a similar economic result to the debtor performing to that one creditor who then uses the funds to pay their debt.
Confusion of Rights (混同, kondō - Article 435):
If one of the joint and several creditors also becomes the debtor (e.g., the debtor inherits the full rights of one of the joint and several creditors, or one creditor entity merges with the debtor entity), the debtor is deemed to have performed the obligation. Consequently, the joint and several claim is extinguished for all creditors. The party in whom the creditor's right and the debtor's obligation have merged is then typically obligated to account for and distribute the internal shares to the other former co-creditors. This has an absolute effect.
Other Events (Generally Relative Effect - Article 435-2):
For most other events concerning only one joint and several creditor—such as the completion of prescription (statute of limitations) with respect to one creditor's ability to sue, a judgment obtained by or against only one creditor, or one creditor falling into bankruptcy—these will generally have only relative effect and not impact the rights or status of the other joint and several creditors vis-à-vis the debtor. For example, if the prescription period for one creditor to sue has run, another co-creditor whose period has not run may still be able to pursue the claim (though the internal distribution will then need to account for this).
- Proviso for Agreement: Article 435-2 allows for an exception if another joint and several creditor and the debtor have agreed that an event concerning one creditor will affect that other creditor.

Internal Relationship Among Joint and Several Creditors: Distribution

When a debtor performs their obligation to one of the joint and several creditors, or when an event like set-off or confusion extinguishes the debt vis-à-vis all creditors due to the position of one, the question of the internal relationship among the co-creditors arises.

Although the Civil Code does not have a specific article detailing the distribution percentages for joint and several claims with the same explicitness as it does for the burden-sharing (負担部分, futan bubun) among joint and several obligors, the underlying principle is clear: a creditor who has received performance (or the benefit of a discharge like set-off) is obligated to distribute the proceeds or benefits to the other joint and several creditors according to their respective internal shares or entitlements (持分, mochibun).

Unless there is a specific agreement among the co-creditors regarding their shares, or unless the circumstances surrounding the origin of the claim dictate otherwise (e.g., unequal contributions to a joint venture giving rise to the claim), their internal shares are generally presumed to be equal.

This internal accounting mechanism is vital because the debtor is protected by being able to discharge their entire obligation by dealing with just one of the joint and several creditors. The co-creditors must then settle the distribution among themselves.

Practical Implications

The framework for joint and several claims has several practical implications:

For Debtors: It simplifies performance, as payment to any one of the designated joint and several creditors generally discharges the entire debt. However, clear identification of who qualifies as a joint and several creditor is important.
For Creditors: It offers flexibility and efficiency in enforcement, as any one creditor can pursue the full claim for the benefit of all. However, it necessitates a high degree of trust and robust mechanisms for internal communication and distribution of any funds or benefits received. Formal agreements among co-creditors detailing their shares, decision-making processes for enforcement, and distribution protocols are highly advisable.
Clarity in Contractual Drafting: When parties intend to create joint and several claims for a divisible performance, their agreement should explicitly state this intention to avoid ambiguity and potential default to the rules of simple divisible claims.

Conclusion

The explicit recognition and regulation of joint and several claims (rentai saiken) in the modernized Japanese Civil Code provide a clearer and more robust legal basis for arrangements where multiple creditors are entitled to a single, divisible performance from a debtor. This framework facilitates collective creditor action while allowing the debtor a straightforward means of discharge. Key to navigating these arrangements is a thorough understanding of the external effects—particularly the right of each creditor to claim the full amount for all, and the debtor's ability to pay any one—and the distinct rules governing how actions and events concerning one creditor impact the rights of the others, especially in cases of release, novation, set-off, and confusion. Furthermore, robust internal agreements among co-creditors regarding their respective shares and the distribution of proceeds are essential for the smooth functioning of such collective claims.