structural:scholar_edition, structural:reformatting
Japanese contract law

Japanese contract law forms a distinct branch within the broader world of civil law jurisprudence, initially derived primarily from German jurisprudence adopted in the aftermath of the Meiji Restoration. While the basic rules of Japanese contract law are prescribed in the Japanese Civil Code (together with the rules underpinning other areas of private law, including tort and family law), more detailed rules concerning commercial contracts are prescribed in the Japanese Commercial Code. A contract under Japanese law is formed by way of offer and acceptance as in most jurisdictions; however, a written document is not a prerequisite for the existence of a contract, which comes into being based on the principle of consensualism. Under Japanese contract law, alignment between the intentions of the parties to a contract is thus considered vital and contracts may be voided depending on the circumstances where a party conceals its true intentions, intentionally or fraudulently manifests false intentions, mistakenly manifests false intentions, or is coerced into manifesting false intentions. Contracts which violate mandatory prescriptions of law, as well as contracts which violate public policy, may be deemed void ab initio to the extent of the violation.

Japanese contract law recognises the existence of pre-contractual and post-contractual obligations. With regard to pre-contractual obligations, a party to a contract which is ultimately impossible to perform or void may be liable for negligence in concluding the contract if another party relied upon their representations and consequently suffered pecuniary or other material damages. Another distinct area of pre-contractual obligation pertains to experts' obligation to explain complicated contracts to consumers, with complex financial contracts being a key example of this. Post-contractual obligations frequently recognised under Japanese contract law include obligations regarding confidentiality and non-competition, which may be defined by the contract itself, implied for reasons of public policy, or provided for by non-derogable statutory law.

The Japanese Civil Code provides for a variety of nominate contracts similar to those prescribed in other civil law jurisdictions; including contracts for sale, gifts, leases, loans, and the provision of services. These nominate contracts are subject to specific rules and warranties mandated by the code in order to protect the rights of the contracting parties, particularly those with lesser negotiating power. Additionally, nominate contracts for the formation of partnerships and associations govern the establishment of these categories of legal persons and there are special provisions governing third party beneficiary contracts. Rules governing the performance of contracts, set-off, assignment, and the seizure of defaulting obligors' assets are also provided by the Japanese Civil Code.

Contract law in Japan, despite the civil law origins of its civil code, is heavily shaped by traditional Japanese attitudes toward business and obligations. For example, under the Japanese Commercial Code, a merchant trader who receives an offer from a regular client that falls within one of their areas of business is expected to respond without undue delay and, if they fail to do so, they are presumed to have accepted the contract. This can be seen as an illustration of a Japanese approach to commerce and contract law rooted in notions of honouring relationships. This is significant since, owing to the German roots of the Japanese Civil Code; once a contract becomes effective as between the parties, it is not freely revocable. Japanese judges, interpreting the obligation of good faith contained in the Japanese Civil Code as codifying this notion of honour-bound relationship in commerce, tend to deny both the termination of pre-contractual negotiations and the non-renewal of existing contractual relations.