The Non-Code Security Interests: A Study of Japanese Case Law

Abstract

This paper is a study of the legal perimeters delineated by judicial precedent for three widely used security devices in Japan—the joto tampo, the uriwatashi tampo, and the daibutsu bensai no yoyaku or preliminary contract for substitute performance. They are distinct creations of Japanese case law. Without direct basis in either code or statute, their justification is found in contract law, more properly the law of obligations (saikenho). One can, however, view each as the result of clever manipulation of contract formulas by lenders, judges, or lawyers to create a security device not provided in the Civil Code or supplementary legislation. In any event, they number among the obligation theory security interests or the non-code security devices of Japanese law. The purpose of this paper is to gain some insight into the function of Japanese courts and the adaptation of law, Western or other, to needs and demands in Japanese society. The three security devices examined are judicial creations distinct to the Japanese legal system. Their continuing legal development offers concrete illustration of that process so anomalous in theory to the civilian tradition—case law—in the context of basic economic needs, traditional patterns, and social policies. The development of these security devices should quash any notion that Japanese civilian courts play a far less decisive role in the evolution of law than their common law counterparts. What contrast there is in the process of judge-made law between Japan and the United State may lie more in the approach than the result. In 1971, when this LL.M. thesis was written, many people believed that civil law systems like Japan’s gave only the slightest weight to judicial precedent. Since then, comparativists have recognized much more nuance, but this careful study of precedent still makes a contribution to the field.