Multiple Seizures on a Single Debt in Japan: Which Legal Grounds Justify an Enforcement Deposit?

Japanese Attorney at Law - Bengoshi L.L.

• 8 min read

When a company or individual (a "third-party obligor") owes a monetary debt (such as salary, accounts receivable, or rent) to someone who, in turn, has their own creditors, that debt can become the target of seizure orders. If multiple seizure orders from different claimants—perhaps general creditors, tax authorities, or family support obligees—are served on the third-party obligor, all targeting the same underlying debt, the situation becomes complex. The third-party obligor, caught in the middle, often has the option, or sometimes the obligation, to make an "enforcement deposit" (shikkō kyotaku) with a Japanese legal affairs bureau. This deposit can discharge their liability. However, a critical question arises: which specific statutory provisions should be cited as the legal basis for such a deposit? The answer depends on a careful analysis of the nature and interplay of the competing seizures.

Fundamental Concepts in Japanese Seizure Law

Before diving into specific scenarios, understanding a few key concepts is essential:

  1. Seizure Orders (差押命令 - Sashiosae Meirei):
    A seizure order, typically issued by a court under the Civil Execution Act (Minji Shikkō Hō) or by a tax authority under tax delinquency laws, prohibits the third-party obligor from paying the debt to their original creditor (the primary debtor in the seizure). Instead, it directs the third-party obligor to pay the seizing creditor or, in certain circumstances, to deposit the funds.
  2. Competition of Seizures (差押えの競合 - Sashiosae no Kyōgō):
    This occurs when two or more seizure orders (or provisional seizure orders) are validly executed against the same monetary claim, and the total sum of the amounts claimed by these seizing creditors exceeds the actual seizable amount of the underlying debt owed by the third-party obligor. The existence of such competition often triggers specific legal obligations, including, in some cases, a mandatory duty to deposit.
  3. Expansion of Seizure Effect (差押効の拡張 - Sashiosaekō no Kakuchō):
    Under Article 149 of Japan's Civil Execution Act, if a monetary claim is partially seized, and subsequently, other seizure orders are served that result in a "competition of seizures," the effect of the initial partial seizure can expand to cover the entirety of the monetary claim. Similarly, if a claim is seized in its entirety and then another seizure targets a part of it, leading to competition, the effects of the partial seizures also extend to the whole claim.
    This expansionary principle is particularly strong for seizures under the Civil Execution Act. It ensures that the entire available fund is brought into the execution proceedings for distribution. Seizures by tax authorities, however, operate under different statutes (e.g., the National Tax Collection Act). While tax claims often have statutory priority, the "expansion of seizure effect" as defined in the Civil Execution Act might not apply in the same way to a tax seizure itself. If a tax seizure is first, it generally secures the tax claim irrespective of later civil execution seizures, up to the amount seizable under tax laws. The interaction is governed by specific adjustment laws.

Key Statutes Governing Enforcement Deposits

When multiple seizures compete, a third-party obligor must look to several key pieces of legislation to determine the correct basis for an enforcement deposit:

  1. Civil Execution Act (民事執行法 - Minji Shikkō Hō):
    • Article 156, Paragraph 1 (Rights Deposit - 権利供託 kenri kyotaku): This provision allows a third-party obligor who has been served with a seizure order to deposit the entire amount of the debt they owe, even if there is only one seizure order and no competition. This is a voluntary deposit made to obtain a discharge from liability.
    • Article 156, Paragraph 2 (Obligatory Deposit - 義務供託 gimu kyotaku): This paragraph obligates the third-party obligor to deposit the monetary claim (or the portion subject to seizure if the claim is larger than the seized amount and there's no expansion of effect, though usually the entire seizable claim is deposited due to expansion) if there is a "competition of seizures" arising from multiple orders issued under the Civil Execution Act (or orders treated as such for distribution purposes).
  2. Act on the Adjustment of Procedures Relating to Tax Delinquency Dispositions and Compulsory Executions, etc. (滞納処分と強制執行等との手続の調整に関する法律 - Tainō Shobun to Kyōsei Shikkō tō to no Tetsuzuki no Chōsei ni Kansuru Hōritsu, commonly abbreviated as 滞調法 - Taichōhō):
    This crucial Act harmonizes procedures when seizures by tax authorities (for national or local tax delinquencies) compete with seizures made under civil execution processes. It contains specific deposit provisions:
    • Article 20-6 (Tax Seizure Precedes Competing Civil Execution Seizure): If a tax authority seizes a claim first, and subsequently a civil execution seizure is served creating competition, the third-party obligor may deposit the entire amount of the monetary claim.
    • Article 36-6 (Civil Execution Seizure Precedes Competing Tax Seizure): If a civil execution seizure is served first, and subsequently a tax authority seizure is served creating competition, the third-party obligor must deposit the entire amount of the monetary claim. This is an obligatory deposit.

The order of service and the nature of the seizing authorities (court vs. tax office) are critical in determining which article of the Taichōhō applies.

The complexity in choosing the correct legal basis for a deposit, especially when dealing with salary or wage garnishments, arises from the concept of non-seizable ranges (差押禁止範囲 - sashiosae kinshi han'i).

  • Varying Protections: Japanese law protects certain portions of a debtor's income and assets from seizure to ensure their livelihood.
    • For general wage garnishments, Article 152 of the Civil Execution Act typically exempts three-fourths of the net salary (after deducting taxes and social security contributions), subject to certain caps.
    • For obligations related to maintenance, child support, or marital expenses, the non-seizable range is often smaller (e.g., only one-half of the net salary might be exempt, or a fixed amount if higher).
    • Tax collection laws (like Article 76 of the National Tax Collection Act - 国税徴収法 Kokuzei Chōshū Hō) also define specific non-seizable amounts for livelihood protection, which may differ from those under the Civil Execution Act.
  • Determining the "Seizable Amount" for Each Order: The actual amount that can be seized by any single order is what remains after applying its specific non-seizable range rules.
  • The "Overlapping Seizable Portion" is Key: When different types of seizure orders with different non-seizable range calculations target the same debt, true "competition" for the purpose of selecting the most precise deposit clause(s) is considered to occur only within the overlapping segment of their respective seizable amounts. Portions of the debt that are seizable under one type of order but fall within the non-seizable range of another are not truly "competing" in this specific sense.

Analyzing Scenarios: Choosing the Right Statutory Clauses

Let's consider examples based on these principles, focusing on salary garnishment, a common scenario for enforcement deposits. Assume a net monthly salary of ¥200,000 after statutory deductions for taxes and social security.

Scenario 1: Civil Execution Seizure vs. National Tax Seizure (Based on the problem explored on PDF page 98)

  • Facts:
    • Net salary: ¥200,000.
    • Seizure 1 (Civil Execution): A court order for a general debt, claiming ¥20,000. Under Civil Execution Act Art. 152, generally 3/4 is non-seizable; thus, 1/4 (¥50,000) is potentially seizable. Although only ¥20,000 is claimed, the "expansion of seizure effect" means this seizure order potentially affects the entire ¥50,000 seizable portion if competition arises.
    • Seizure 2 (National Tax Delinquency): A tax office seizure claiming ¥90,000. Under National Tax Collection Act Art. 76, assume the non-seizable amount for livelihood is ¥100,000, making ¥100,000 of the net salary seizable by the tax office.
  • Analysis of Competition and Deposit Basis:
    1. The civil execution seizure has an effective reach over ¥50,000 of the salary.
    2. The tax seizure can target up to ¥100,000 of the salary and is claiming ¥90,000 of that.
    3. The portion of the salary where both types of claims could simultaneously attach (considering the civil execution's ¥50,000 reach and the tax authority's broader reach) is the initial ¥50,000. This is the "competing amount" that engages the Taichōhō.
    4. Since the civil execution seizure was served (or is presumed to be in effect with its expanded reach) when the tax seizure created competition, Article 36-6, Paragraph 1 of the Taichōhō applies to this ¥50,000 portion. This makes depositing this ¥50,000 an obligation.
    5. The tax authority is claiming an additional ¥40,000 (total ¥90,000 claim - ¥50,000 covered by the competing portion). This remaining ¥40,000 is seizable under tax law (as the tax seizable amount is ¥100,000) but is beyond the ¥50,000 reach of the civil execution order. Therefore, this ¥40,000 is not considered to be in competition with the civil execution seizure in a way that mandates its deposit under Taichōhō. This portion should be paid directly by the third-party obligor (employer) to the tax authority.
    • Conclusion for Deposit: The employer must deposit ¥50,000, citing Taichōhō Article 36-6, Paragraph 1 as the legal basis. They should separately pay ¥40,000 directly to the tax authority.

Scenario 2: General Civil Execution Seizure vs. Maintenance Obligation Seizure (Based on PDF Example 3, page 97)

  • Facts:
    • Net salary: ¥200,000.
    • Seizure 1 (General Civil Debt): Court order claiming ¥50,000. (Standard 1/4 seizable amount is ¥50,000; non-seizable is ¥150,000).
    • Seizure 2 (Maintenance/Child Support): Court order claiming ¥100,000. (For maintenance, typically 1/2 is seizable if net pay is below a certain threshold like ¥660,000 per month, making ¥100,000 seizable; non-seizable is ¥100,000).
  • Analysis of Competition and Deposit Basis:
    1. The general debt seizure can attach up to ¥50,000.
    2. The maintenance seizure can attach up to ¥100,000.
    3. The overlapping seizable portion where both claims can simultaneously attach is the first ¥50,000 of the seizable salary.
    4. This ¥50,000 portion is subject to Article 156, Paragraph 2 of the Civil Execution Act (obligatory deposit) because two civil execution-based seizures are competing for it.
    5. The additional ¥50,000 (from the ¥50,001 to ¥100,000 mark of the seizable salary) can only be claimed by the maintenance seizure (as the general debt seizure is capped at ¥50,000). If the employer chooses to deposit the full ¥100,000 to cover both claims, this second ¥50,000 portion would be deposited under Article 156, Paragraph 1 of the Civil Execution Act (rights deposit).
    • Conclusion for Deposit: If depositing the full ¥100,000, the legal basis cited on the deposit form would be a combination: "Civil Execution Act Article 156, Paragraph 1 and Article 156, Paragraph 2."
    • Important Exception (PDF page 97): If the net salary were very high (e.g., over ¥660,000 per month), the non-seizable amount for both general debts and maintenance might align at a fixed higher figure (e.g., ¥330,000). In such a case, if both seizures are competing for amounts above this common non-seizable threshold, then Article 156, Paragraph 2 alone might apply to the entire sum being competed for.

Structuring the Deposit Application and Subsequent Steps

When making an enforcement deposit involving competing seizures:

  • Clarity is Paramount: The deposit application form (kyotakusho) must clearly identify all relevant seizure orders (court/tax office, case numbers, names of seizing creditors, original debtor, and amounts claimed).
  • Precise Legal Grounds: The statutory article(s) forming the basis of the deposit must be accurately stated. If different portions of the deposited sum fall under different articles (as in Scenario 2 above), this should be clearly articulated if possible, or at least the combination of articles should be cited.
  • Notification to the Court/Authorities (事情届 - Jijō Todoke): After making the deposit, the third-party obligor has a crucial duty to file a "Notification of Circumstances" with the relevant execution court(s) (Civil Execution Act Article 156, Paragraph 3). If tax seizures are involved and a deposit is made under the Taichōhō, notifications to tax authorities may also be required or handled via the court. This notification informs the court/authorities of the deposit, allowing them to initiate procedures for distributing the funds to the entitled creditors.

Conclusion: Navigating a Complex Intersection of Laws

Determining the correct legal basis for an enforcement deposit in Japan when faced with multiple, competing seizure orders on a single debt is a nuanced task. It demands a thorough understanding of each seizure order, the nature of the underlying debt (especially if it's salary with specific non-seizable protections), and the interplay between the Civil Execution Act and the Taichōhō.

The critical step often involves identifying the truly "competing portion" by considering the seizable amount permissible under each type of order after accounting for different non-seizable ranges. This overlapping amount is what typically triggers obligatory deposit provisions or specific coordinating rules under the Taichōhō. For amounts seizable by only one order but not another within the overall debt, a "rights deposit" under Article 156, Paragraph 1 of the Civil Execution Act might be an option if the third-party obligor wishes to deposit the entire sum they hold.

Given the potential for error and the serious consequences of failing to comply with deposit obligations (which could include continued liability to seizing creditors), third-party obligors facing such complex scenarios should proceed with diligence and are often well-advised to seek legal counsel to ensure compliance and proper discharge of their obligations.