What Are "Indivisible Obligations/Claims" (Fukabun Saimu/Saiken) in Japanese Law and How Are They Handled?

Japanese Attorney at Law - Bengoshi L.L.

• 7 min read

In many contractual situations, the subject matter of an obligation can be neatly divided – for example, a monetary debt can be paid in parts, or a quantity of generic goods can be delivered in installments. These are "divisible" obligations or claims. However, Japanese law also provides specific rules for "Indivisible Obligations" (Fukabun Saimu 不可分債務) and "Indivisible Claims" (Fukabun Saiken), where multiple parties are involved on one side of an obligation, and the core performance itself cannot be broken down. Understanding how these are treated, especially in comparison to joint and several obligations/claims, is crucial.

What Makes an Obligation or Claim "Indivisible"?

An obligation or claim is considered indivisible under Japanese law if its object (the performance due) cannot be divided, either:

  1. By its Inherent Nature: The performance or the thing to be delivered is inherently unpartitionable without destroying its essential character or substantially diminishing its value.
    • Examples: The obligation to deliver a specific, unique painting; the obligation to transfer ownership of a single, live animal; the obligation to perform a singular, unique service like a surgical operation or a specific artistic performance.
  2. By Declaration of Intent of the Parties: Even if the subject matter is physically divisible, the contracting parties can expressly agree that the performance shall be treated as indivisible for the purposes of their contract.
    • Example: An agreement to deliver a set of matched machinery components, where the parties specify that the delivery of the entire set constitutes a single, indivisible performance.

This contrasts with "divisible obligations/claims" (kabun saimu/saiken), where, if there are multiple debtors or creditors, each is generally liable for or entitled to only an equal proportionate share, unless otherwise agreed (Japanese Civil Code Art. 427).

Indivisible Obligations (Fukabun Saimu – Japanese Civil Code Arts. 430, 431): Multiple Debtors, One Indivisible Performance

When several obligors are bound to render a single, indivisible performance to a creditor, it is termed an indivisible obligation.

Core Concept: Each debtor is, in a sense, responsible for ensuring the entire indivisible performance is rendered.

External Effects (Creditor vs. Obligors) – Borrowing from Joint and Several Obligations, with a Twist:
Article 430 of the Civil Code states that the provisions concerning joint and several obligations (rentai saimu – Articles 436 to 440 and 442 to 445) apply mutatis mutandis (with necessary changes) to indivisible obligations, with one critical exception: Article 441 is excluded. Article 441 is the provision (introduced in the 2017 Civil Code reforms) that establishes the general principle of "relative effect" for most events concerning one joint and several obligor (meaning an event affecting one doesn't automatically affect others).

  • Creditor's Right to Demand: The creditor can demand the entire indivisible performance from any one of the indivisible obligors (Art. 430 applying Art. 436 by analogy).
  • Performance by One Discharges All: If one indivisible obligor renders the complete indivisible performance, all co-obligors are discharged from the obligation to the creditor (Art. 430 applying Art. 439, Para. 1 by analogy).

Crucial Distinction: The Impact of Events Concerning One Obligor – Predominance of "Absolute Effect"
Because Article 430 excludes the application of Article 441 (the new "relative effect" principle for joint and several obligations), many events concerning one indivisible obligor have an ABSOLUTE EFFECT on the other co-obligors. This means that these events affect all co-obligors collectively, often in a manner similar to the pre-2017 rules for joint and several obligations. This is a key point of differentiation from modern joint and several obligations.

  • Demand for Performance (Riko no Seikyu): A demand made by the creditor against one indivisible obligor is effective against (benefits) all other co-obligors (e.g., it interrupts the statute of limitations for the claim against all) (Art. 430 applying Art. 438 by analogy).
  • Novation (Kokai) or Merger (Kondo): If the creditor enters into a novation agreement with one indivisible obligor concerning the indivisible obligation, or if the obligation merges with respect to one indivisible obligor (e.g., that obligor becomes the creditor), the entire indivisible obligation is generally extinguished for all co-obligors (Art. 430 applying Art. 439, Para. 1 and Art. 440 by analogy).
  • Release of Obligation (Menjo): If the creditor releases one indivisible obligor from the obligation, this release generally benefits all co-obligors, extinguishing the entire indivisible obligation. This is because Art. 430 applies principles similar to the pre-2017 rules for joint and several obligations (specifically, old Article 437), where a release given to one had an absolute effect.
  • Completion of Prescription (Jiko no Kansei): Similarly, if the statute of limitations for the claim expires with respect to one indivisible obligor, this completion of prescription generally benefits all co-obligors, extinguishing the entire indivisible obligation (Art. 430 applying principles similar to old Article 439).

This retention of "absolute effect" for indivisible obligations concerning events like release and prescription for one obligor is a significant characteristic distinguishing them from the current rules for joint and several obligations (which favor relative effect for such events under Art. 441 and Art. 439, Para. 2).

Internal Relationships Among Indivisible Obligors (Art. 431):
While externally they face these collective effects, internally, among themselves, the indivisible obligors have respective shares of the ultimate burden. Article 431 states that the provisions concerning the right of reimbursement (kyushoken 求償権) among joint and several obligors (Articles 442 to 445) apply mutatis mutandis.

  • This means co-obligors have internal burden shares (determined by agreement or benefit received, otherwise presumed equal).
  • An obligor who performs the entire indivisible obligation (or otherwise obtains a common discharge at their expense) can seek reimbursement from the other co-obligors for their respective internal shares, including interest and necessary expenses. The notification duties outlined for joint and several obligors (Art. 443) would also apply.

Indivisible Claims (Fukabun Saiken – Japanese Civil Code Arts. 428, 429): Multiple Creditors, One Indivisible Entitlement

When multiple creditors are jointly entitled to receive a single, indivisible performance from a debtor, it is termed an indivisible claim.

Core Concept: Each creditor has an interest in the entire indivisible performance.

External Effects (Debtor vs. Creditors):

  1. Each Creditor Can Demand Full Performance (Art. 428): Any one of the indivisible creditors can demand the entire indivisible performance from the debtor, for the benefit of all co-creditors. (Article 428 applies Article 432, concerning joint and several claims, by analogy).
  2. Debtor Performs to One, Discharges All (Art. 428): The debtor can validly discharge their entire obligation by rendering the complete indivisible performance to any one of the indivisible creditors (again, by analogy to Article 432).

Impact of Other Events Concerning One Creditor (Art. 429) – Tendency Towards "Relative Effect":
Article 429, Paragraph 1, governs how events (other than performance or a demand for performance) affecting one indivisible creditor impact the debtor and other co-creditors. It applies mutatis mutandis certain rules historically associated with joint and several claims (specifically, Articles 433 to 435 of the Civil Code as they stood before the 2017 general reforms regarding joint and several creditors). This leads to a nuanced outcome where many such events have a primarily relative effect:

  • Demand for Performance (Riko no Seikyu): A demand made by one indivisible creditor benefits all co-creditors (e.g., interrupts prescription for all) (Art. 429(1) applying Art. 434 by analogy). This is an absolute effect.
  • Novation (Kokai) or Release (Menjo) Involving One Creditor: If one indivisible creditor enters into a novation agreement with the debtor concerning their share of the claim, or releases the debtor from their share, this act generally affects only that specific creditor's interest in the claim. The other co-creditors can typically still demand performance of the remaining indivisible obligation, or their share of its value if the object itself can no longer be fully realized due to the individual creditor's act. The entire indivisible claim is not automatically extinguished for the others.
  • Set-Off by the Debtor Against One Creditor: If the debtor has a claim against one of the indivisible creditors and validly sets it off, this typically extinguishes the overall debt only to the extent of that specific creditor's internal share or interest.
  • Merger (Kondo) Involving One Creditor: If the claim and obligation merge with respect to one indivisible creditor, only that creditor's portion or interest in the claim is generally extinguished.

This tendency towards relative effect for acts like release or novation by one indivisible creditor is a notable characteristic, distinguishing it from the treatment of similar events for joint and several claims (where release/novation by one creditor can have absolute effect under current Art. 433) and for indivisible obligations (where release/prescription concerning one debtor has absolute effect).

Internal Relationships Among Indivisible Creditors (Art. 429, Para. 2):
The rules governing the external relationship do not affect the internal division of rights or benefits among the co-creditors. These are determined by their underlying agreement or the nature of their co-entitlement (e.g., rules of co-ownership). If one creditor receives the entire indivisible performance, they are generally accountable to the others for their respective shares.

Key Distinctions Summarized

The treatment of indivisible obligations and claims borrows from, but also diverges in critical ways from, the rules for joint and several obligations and claims, especially after the 2017 Civil Code reforms which emphasized "relative effect" for many aspects of joint and several obligations.

  • Indivisible Obligations (Fukabun Saimu):
    • Creditor can demand full performance from any debtor.
    • Performance by one discharges all.
    • Crucially, events like release of one debtor, or prescription completing for one debtor, generally have an ABSOLUTE EFFECT, benefiting all co-debtors and extinguishing the entire obligation. This is because Art. 430 excludes the application of Art. 441 (the relative effect principle for modern joint and several obligations).
  • Indivisible Claims (Fukabun Saiken):
    • Any creditor can demand full performance for all.
    • Performance to one discharges the debtor against all.
    • Events like novation or release by one creditor generally have a RELATIVE EFFECT, impacting only that creditor's share or interest, allowing other creditors to pursue their remaining interest.
  • Modern Joint and Several Obligations (Rentai Saimu):
    • Events like release or prescription concerning one debtor now generally have a RELATIVE EFFECT on other co-debtors (they remain liable for the whole, adjusted for internal burden).
  • Modern Joint and Several Claims (Rentai Saiken):
    • Events like novation or release by one creditor (or debtor's set-off against one) have an ABSOLUTE EFFECT, extinguishing the entire claim for all co-creditors (Art. 433). Other matters mostly have relative effect (Art. 435-2).

Conclusion

When the subject matter of an obligation involving multiple parties on one side is indivisible by its nature or by party agreement, Japanese law applies the specific frameworks of "Indivisible Obligations" and "Indivisible Claims." While these concepts draw heavily on the principles governing joint and several liabilities and entitlements, they possess distinct characteristics, particularly concerning the "spill-over" effects of events related to one party on the others. Notably, indivisible obligations retain a stronger tendency towards "absolute effect" for events like release or prescription concerning one debtor, a feature that now contrasts with the reformed rules for joint and several obligations. Conversely, indivisible claims tend towards "relative effect" for similar creditor-side events, differing from the absolute effect seen in joint and several claims for actions like release by one creditor. Understanding these specific rules is essential for accurately determining the rights and liabilities of all parties involved in such complex multi-party obligations.