New Rules of International
Civil Jurisdiction in Japan

Shunichiro NAKANOKobe University Law Schoolsnakano@kobe-u.ac.jp

Ⅰ Notion of International Court
Jurisdiction• Exercise of Judicial Sovereign Power of a Stateis not open for every international cases• In what case, or under what condition, anInternational Civil and Commercial Disputes canbe handled by the Japanese Court?
• In what case the plaintiff can sue the defendantin Japanese Court?
• Example:

Malaysia Airlines Case of 1981
A (Jap.Businessman)

X (Successors)

Malaysia Airlines
Sued in Japanese court

・Defendant:"Japanese court has no jurisdiction,
because the incident has no sufficient connection toJapan"・Jap. Supreme Court affirmed international jurisdiction
because the Defendant had its Branch in Japan→Not very persuasive

Factors to be considered◆From the Defendanｔ's perspective:• The Accident occurred in Malaysia• Important evidences were mostly located inMalaysia• Most Witnesses / Victims were there→Japan is not a good place to hear the case
◆From the victim's perspective:• The parties were not equalⅡ Relevant Basis of International
Civil Jurisdiction
１ Defendant's Domicile• Art.3-2(1) JCCP: "The courts shall havejurisdiction over an action against a person:- if he/she has his/her domicile in Japan"
・ Art.3-2(3)JCCP: "The courts shall havejurisdiction over an action against a juridical
person or any other association or
foundation, if its principal office or businessoffice is located in Japan"

• Even the Roman Law knew this principle("actor sequitur forum rei")• Court of the defendant's domicile can
exercise jurisdiction over ANY action againsthim (“General Forum“)• ratio legis of this rule: protection of theprocedural right of the defendant (consultinglawyer, collection of evidence/witnesses:
procedural status of the plaintiff is generally
better than the defendant)• The law gives priority to the defendant２ Location of the Defendant's Asset• Art.3-3 (3) JCCP: Japanese court has
international jurisdiction, if "seizable propertyof the defendant is located in Japan(excluding cases where the value of suchproperty is extremely low)"• Ratio legis: possibility of execution• If the defendant has assets in the Forum
State, the plaintiff can enforce judgment tocollect moneyForum of the Defendant Assets- criticized as "Excessive” Jurisdiction• "Excessive jurisdiction" - inadequate
exercise of court jurisdiction, where theForum State has NO relevant connection
to the case
• Why Jurisdiction of the Defendant Assets
can be excessive?

３ Place of Performance• Place of performance of the obligation ー
regarded as a relevant jurisdictional basis for thecontract disputes in many Civil Law countries• Art.3-3 (1) JCCP: For an action based on acontract, Japanese court has international
juricdiction, "in cases where the place ofperformance of the obligation provided for in thecontract is located in Japan".
• Creditor has legitimate expectation that thedebtor performs his duty there→If not, lawsuit can be filed there４ Place of Tort
• "Place of tort" jurisdiction ー accepted inmost legal systems• Art.3-3 (8) JCCP: An action relating to a tort
may be brought in Japanese court, if "theplace where the tort was committed islocated in Japan (excluding cases where aharmful act was committed in a foreign state
but where the occurrence of consequence ofsaid act in Japan was not normallyforeseeable)".

Ratio legis of the Place of Tort
Jurisdiction① Place of tort is the only factor whichconnects plaintiff and defendant② Most evidences or witnesses of theaccident are located there③ Victims of the tort are residing there→This jurisdiction will promote protection ofthe victim

What is ”Place of Tort”?
• Usually place of tort is easy to determine• In PL Cases, the place of tortious act andplace of injury may be different
Company Y(State A）
manufactured a medicine
which had harmful ingredients（Place of tortious act=place of production）

Victim X (Japan）
bought and took medicine in Japan andsuffered damage(Place of Injury)→Both State A and Japan are the "place of tort"

In some exceptional cases, place of injury
is unpredictable for manufacturer
Company Y(State A）
manufactured a medicine
which was sold only in State A

Victim X(Japan）
bought medicine in State A
and suffered damage in Japan→Should Japanese Courts have Jurisdiction?
→No (unpredictable for the manufacturer)→Art.3-3 (8) JCCP provides in parenthesis:

５ Protection of the weaker party• Considering the disparity of powerbetween juridical person and natural
person, protection of the weak is crucial
for determinig international jurisdiction→Japanese Lawmaker made a new rule onprotection of consumers and labors

Art.3-4(1) (Consumer Contract)• "An action brought by a consumer……against abusiness operator …… with respect to acontract concluded between the consumer andthe business operator …… may be filed withthe courts of Japan, if the domicile of theconsumer …… is located in Japan".
• THE CONSUMER may bring suit in his/her domicile
against the business operator• THE BUSINESS OPERATOR has to file a lawsuit in
the domicile of the consumer

Art.3-4(2) (Labor Contract)• "An action brought by an individual employee
against an employer in relation to a civil
dispute arisen between them …… may be
filed with the courts of Japan, if the place ofperformance of his/her labor under the labor
contract …… is located in Japan".
• "The place of performance of labor" is in
most cases the same as the labor's domicile→The weaker party is favoredArt.3-4(3)• "The preceding article shall not apply to anaction brought by a business operator against aconsumer …… and an action brought by anemployer against an employee".
• "The preceding article": Art.3-3 (jurisdiction ofdefendant's assets, place of performance,
place of tort etc.)→BUSINESS OPERATOR may not make useof this Article, but CONSUMER may→The weaker party is strongly favoredProtection of the weaker party
Defendant's Domicile(Art.3-2)

Action brought by
Consumer or Labor×Action brought byBusiness Oprator

Consumer's Domicile(Art.3-4(1))
Place of Performanceof Labor (Art.3-4(2))×
Place of Defendant's Asset,
Place of Tort etc.(Art.3-3)

Ⅲ "Special Circumstaces" Test
• There's no rule without exception• Common Law: "Forum Non Conveniens"
Doctrine• Even if jurisdictional basis exists, in some
exceptional cases, judge may refrain fromexercising jurisdiction• Judges have broad discretion to apply thisdoctrine

Tokyo District Court,Decision of 1986
(Far Eastern Air Transport Case)FEAT (Taiwanese Airline)

Japanese Victims

United Airlines(Seller)
Successors
Boeing Company(Manufacturer)

PL Suit in Japan

Decision• Jurisdictional basis was located in Japan• But there are "exceptional circumstances",
which make the exercise of the Japanesecourt jurisdiction defficult• Most evidences are located in Taiwan• "As there's no diplomatic relationshipbetween Japan and Taiwan, judicial
cooperation to investigate these evidences
cannot be expected"→"Virtually impossible to litigate in Japan"

Sup.Court Decision of 1997("Family" Corporation Case)
Contract (Purchaseof Secondhand Car)Ｘ (Jap.Company)

Ｙ (Japanese
Claim (Restitution living in Germany)of Deposit Money)

Ｘ："Place of Performance is located in Japan"
Y: "'Special Circumstances' exist"

Decision: Jurisdiction Denied• Contract was concluded in Germany• Purpose of contract was purchase of car inGermany• No agreement on the place of performance as tothe restitution of deposit money• No agreement on applicable law• Y lived in Germany more than 20 years• Y's principal place of business was located inGermany• Important evidences are located there• "Special Circumstances" exist, which lead to thedenial of Japanese Court Jurisdiction

Art.3-9 JCCP
"Even where the courts of Japan have jurisdiction
over an action……the court may dismiss the whole
or a part of such action when it finds special
circumstances under which a trial and judicial
decision by the courts of Japan would undermine
equity between the parties or disturb realization of aproper and prompt trial, taking into consideration
the nature of the case, the degree of thedefendant’s burden of submitting defense, thelocation of the evidence and any othercircumstances".