Q: How Are Building Defects Judged Under Japanese Law?

Determining whether a building defect exists under Japanese law is a multifaceted process that involves scrutinizing the contract, relevant statutes, industry standards, and the specific circumstances of each case. While the term "kashi" (瑕疵), traditionally denoting a defect, has been formally replaced in the main Civil Code provisions by the concept of "non-conformity" (契約不適合 – keiyaku futekigō) since the Civil Code reforms effective April 1, 2020, the extensive body of case law and established principles for identifying defects remain highly influential in interpreting what constitutes a breach of contractual obligations regarding the quality and performance of a building. This article delves into the primary criteria and processes used in Japan to judge building defects.

The Fundamental Principle: Conformity with the Contract

At its core, the judgment of a building defect, or non-conformity, hinges on whether the completed structure aligns with the terms agreed upon in the contract. This includes not only explicitly stated conditions but also implied expectations of quality and performance. The challenge often lies in precisely defining these terms and expectations, especially when contracts are not exhaustive.

Hierarchy and Application of Judgment Criteria

Japanese courts typically refer to a hierarchy of criteria when assessing building defects. While no single rule dictates their application, a general order of precedence and interplay can be observed:

1. The Contract and Design Documents (契約書及び設計図書 - Keiyakusho oyobi Sekkei Tosho)

The most direct and paramount evidence for judging defects lies within the contractual agreement itself and the accompanying design documents.

• Explicit Contractual Agreements: The contract, including any attached specifications, clauses on quality, or specific performance requirements, serves as the primary benchmark. Any deviation from these explicit terms can constitute a defect. The Supreme Court decision of October 10, 2003 (Minshu 211-13), which found a defect where steel columns of a specifically agreed-upon larger dimension were not used (despite the contractor's claim of structural soundness with smaller columns), underscores the critical importance of adhering to explicit contractual promises regarding quality and safety features.
• Design Documents: Design documents, as defined under Japan's Architects Act (建築士法 - Kenchikushi Hō) and Building Standards Act (建築基準法 - Kenchiku Kijun Hō), encompass drawings (plans, elevations, sections, detail drawings, etc.) and specifications necessary for the execution of construction work. These documents concretize the agreed-upon scope and quality. Discrepancies between the constructed building and these approved documents are strong indicators of a defect. For instance, a judgment by the Sendai District Court on January 13, 2005 (Hanrei Jihō 2112-75) stated that unless the discrepancy is trivial and does not affect the value, function, or aesthetics, nor contravenes the orderer's intent, a mismatch with design documents constitutes a defect.
• Order of Precedence: In cases of conflict between various contractual documents (e.g., general specifications versus special specifications, or drawings versus written specifications), the contract often stipulates an order of precedence. Common practice, as seen in public works contracts, might prioritize Q&A documents, site instruction documents, then special specifications, followed by standard specifications and drawings.

2. Statutory and Regulatory Standards (法令等 - Hōrei tō)

Compliance with relevant laws and regulations is a fundamental expectation.

• Building Standards Act (建築基準法 - Kenchiku Kijun Hō) and Related Regulations (建築基準関係規定 - Kenchiku Kijun Kankei Kitei): These laws establish the minimum legal requirements for building structure, safety, sanitation, fire protection, etc. Non-compliance with these mandatory provisions is almost invariably treated as a defect. The Kyoto District Court, on November 22, 2000 (Kekkanshotai 2-316), held that unless special circumstances indicate a different agreement, it is presumed that parties agree to construct a building compliant with the Building Standards Act and its implementing orders, as these define the minimum standards for public safety and welfare.
• Act on the Promotion of Quality Assurance in Housing (住宅の品質確保の促進等に関する法律 - Hinpyō Hō): This act introduced the Housing Performance Indication System (住宅性能表示制度 - Jūtaku Seinō Hyōji Seido). If a Housing Performance Evaluation Report (住宅性能評価書) is attached to the contract, the performance levels indicated therein are legally deemed to be part of the agreement, unless explicitly stated otherwise. Thus, failure to meet these displayed performance levels would be a defect. However, it's important to distinguish this from the "Technical Standards for Housing Dispute Resolution" (平成12年建設省告示第1653号), which are reference guidelines for dispute resolution bodies and not direct criteria for judging defects in court.
• Other Relevant Statutes: Depending on the defect, other laws such as the Fire Service Act (消防法 - Shōbō Hō), City Planning Act (都市計画法 - Toshi Keikaku Hō), or local ordinances may be relevant.

3. Technical Standards and Industry Best Practices (技術基準及び業界標準 - Gijutsu Kijun oyobi Gyōkai Hyōjun)

These standards, while not always legally binding in themselves, often inform the court's understanding of expected quality or implied contractual terms.

• Japan Housing Finance Agency (JHFA) Technical Standards (住宅金融支援機構仕様書): These standards are highly influential for properties financed through JHFA schemes. For such projects, compliance with JHFA standards is often considered an integral part of the contractual agreement. Their application to non-JHFA financed properties is more debatable; however, some court decisions, like the Nagasaki District Court, Omura Branch, ruling on December 22, 2000 (Hanrei Times 1109-166), have considered them part of the agreed design documents even for non-JHFA projects if circumstances suggest an implied agreement. Conversely, the Takamatsu High Court on February 21, 2008 (Kekkanshotai 5-388), was more restrictive regarding a non-JHFA financed property.
• Architectural Institute of Japan (AIJ) Standard Specifications (日本建築学会・建築工事標準仕様書 - JASS): JASS are widely respected technical specifications for various aspects of construction work.
  • If JASS are explicitly incorporated into the contract by reference, they become binding terms.
  • If not explicitly mentioned, their status is less definitive. Some courts view JASS as reflecting the ordinary technical level and thus potentially forming an implied part of the contract if they represent widespread industry practice. For example, the Nagano District Court, Suwa Branch, on May 11, 2006 (Kekkanshotai 4-528), considered compliance with JASS to be an implied agreement. However, other rulings, such as by the Sendai District Court on December 19, 2003 (Kekkanshotai 3-370), have held that a mere violation of JASS does not automatically constitute a defect unless it also leads to a failure to meet ordinary performance standards. The Fukuoka High Court, on April 15, 2011 (Kekkanshotai 6-334), however, treated the MLIT's standard specifications for public works (and their explanatory guidelines) as authoritative and applicable as implied minimum standards even in private construction.
• Other Industry Guidelines and Norms: Local government construction guidelines or established practices within specific construction trades can also be taken into account.

4. General Principles of Reason / Natural Justice (条理 - Jōri)

In situations where contractual terms are unclear and other standards do not provide a definitive answer, courts may resort to jōri. This concept refers to general principles of reasonableness, fairness, and common sense as applied to the specific context. It implies that certain fundamental qualities are inherently expected, even if not explicitly stated. For example:

• A building should be reasonably waterproof and protect against normal weather conditions.
• There should be adequate drainage for open spaces.
• The building should be structurally stable for its intended use.
• Minor aesthetic imperfections may be judged against a standard of socially acceptable limits, as considered by the Osaka District Court on April 26, 2005 (Hanrei Times 1197-185).

The Judicial Decision-Making Process: A Holistic Evaluation

Japanese courts typically do not rely on a single criterion in isolation. Instead, they engage in a holistic evaluation, considering various factors and evidence. This comprehensive approach is evident in several court rulings.

For example, the Wakayama District Court, on December 18, 2000 (Kekkanshotai 2-486), in assessing defects in a condominium's roof slab, considered the Building Standards Act, AIJ specifications, public corporation (former Housing Loan Corporation) specifications, and design drawings, alongside concrete strength and structural calculation results, to determine if there was a structural or durability issue. Similarly, the Sendai District Court, on December 19, 2003 (Kekkanshotai 3-370), outlined that defect determination should consider: (1) conformity with design documents, (2) compliance with the Building Standards Act and its orders, (3) whether the building meets standard technical levels for structure, function, and safety, and (4) for Housing Loan Corporation financed projects, compliance with its specifications (excluding reference drawings). This court, however, noted that a violation of JASS specifications by itself doesn't immediately equate to a defect.

The process often involves:

• Fact-finding: Detailed examination of the alleged defect, its extent, and its impact.
• Expert Evidence: Opinions from qualified architects, structural engineers, and other construction experts are usually crucial and heavily relied upon by courts to understand technical issues and standards.
• Weighing of Criteria: The court determines the relevance and weight of each applicable criterion (contract, law, industry standard) based on the specific facts.
• Consideration of Overall Impact: The severity of the defect, the cost and feasibility of repair, and the extent to which the defect impairs the building’s intended use are all taken into account.

Relevance under the Post-2020 "Liability for Non-Conformity" Regime

The 2020 Civil Code reform, which introduced "liability for non-conformity," shifts the focus from the abstract notion of a "defect" to whether the delivered subject matter (e.g., a building) "fails to conform to the terms of the contract" regarding its kind, quality, or quantity.

While this is a significant terminological change, the established criteria for judging "kashi" are expected to continue to play a vital role in interpreting what "conformity to the contract" means in practice. The contract itself remains the primary reference point. When the contract is not explicit, the courts will likely continue to refer to statutory requirements (like the Building Standards Act), recognized industry standards, and general principles of reasonableness to determine the agreed-upon or reasonably expected level of quality and performance.

The reform arguably places even greater emphasis on the importance of clearly and comprehensively defining the required quality, performance, and specifications within the contract documents to minimize ambiguity and potential disputes.

Conclusion

Judging building defects in Japan is not a simple matter of applying a rigid checklist. It involves a nuanced, multi-layered analysis. The primary touchstone is the contractual agreement between the parties, including detailed design documents and specifications. Beyond this, statutory requirements, particularly the Building Standards Act, set forth minimum obligatory standards. Widely accepted industry technical standards and, ultimately, general principles of reasonableness also inform the court's determination.

Parties involved in Japanese construction projects should prioritize creating clear, detailed, and comprehensive contractual agreements that explicitly define the expected standards of quality and performance. This proactive approach is the most effective way to prevent disputes related to building defects and to provide a solid framework for judgment should such issues arise, even under the newer "liability for non-conformity" framework.