Japan’s Legal Profession (and ADR and Legal Education) at a Crossroads

Japanese bengoshi lawyers, as the most influential group within the legal profession, stand at a crossroads. Overall, through the overarching Japan Federation of Bar Associations (JFBA), their work and attitudes have become more amenable to collaborating with the judiciary and even public prosecutors in implementing reforms to the litigation system; to increasing the numbers allowed to pass the National Legal Examination as the gateway to careers as a lawyer, judge or prosecutor; and even to allowing Japan’s many “quasi-lawyers” to expand their legal practice, as well as more promotion of privately-supplied ADR services. Reforms in all these areas were propelled by the Judicial Reform Council’s final recommendations to the Prime Minister in 2001, but they were consistent with the trajectory of bengoshi as a whole. However, the controversial election of a new JFBA President may derail all this, with implications also for related initiatives such as Japan’s new postgraduate “Law School” programs inaugurated in 2004.

Until the 1960s, bengoshi and the JFBA were primarily concerned at increasing their status vis-à-vis prosecutors and the courts – implying the need to cap numbers passing the National Legal Examination – and serving as a “noble opposition” to government as well as promoting a strict vision of the rule of law. By the 1980s, more confident in their status and financial circumstances, they had mostly shifted towards a more collaborative relationship. This aimed at extending the rule of law even for example through ADR mechanisms, beginning with a 1978 scheme with insurers to resolve traffic accident disputes, followed by the establishment of Bar Association ADR Centres from 1990.
Since the 1990s, prompted by more radical proposals from certain business and government interests for deregulating and expanding the legal profession, some bengoshi (eg in the emergent corporate law firms) began to see themselves as advancing the public good and the rule of law by becoming mainly private suppliers of even more varied legal services (see HAMANO, R. (2007) The Turn to Law: The Emergence of Corporate Law Firms in Japan. In ALFORD, W. (Ed.) Raising the Bar. Cambridge, Mass, Harvard University Press). This vision not only implies a greater willingness to increase bengoshi numbers, but also to allow expansion in numbers and roles of (more or less) competing “quasi-lawyers” and even non-legal professionals specialising in ADR. The influence of this view even among bengoshi provides one explanation for the many recommendations emerging from the JRC in 2001 and their implementation over 2001-4.
However, this latest view probably remains a minority one among bengoshi. Many bengoshi are still (often older) practitioners leading or working in sole or small practices, and even those in Tokyo or Osaka do not derive most of their work from corporate clients – certainly not transactional work, as opposed to litigation. It is quite unsurprising, therefore, that there has been a visible backlash by this more conservative majority in the recent election of the JFBA President, despite not initially having support from any of the largest – and generally more liberal – Bar Associations (three in Tokyo plus Osaka). As reported in the Mainichi Daily News on 11 March 2010 (“Lawyer beats powerful interests, tradition to become bar association federation president” at <http://mdn.mainichi.jp/mdnnews/news/20100311p2a00m0na016000c.html>):

Lawyer Kenji Utsunomiya, 63, has been elected the next president of the Japan Federation of Bar Associations (JFBA). JFBA presidents had traditionally been elected from candidates backed by the most powerful members in the country’s major bar associations. However, Utsunomiya, who is widely recognized as an expert in multiple debt issues, broke the trend by defeating rival candidate Takeji Yamamoto, 66, who was backed by the current JFBA leadership.
As the overcrowded legal profession became a major campaign issue, Utsunomiya’s proposal to reduce the number of people passing the bar exam to 1,500 a year gained broad support from regional bar associations concerned about over-heated competition and job security at law firms. Meanwhile, Yamamoto, who also proposed a downsizing of the legal community, failed to present a specific target.
To qualify as the winner, a JFBA presidential candidate is required to gain a majority vote in at least a third of all 52 bar associations nationwide. In the first round of voting in February, Yamamoto beat out Utsunomiya by 976 votes. However, as Utsunomiya won a majority in 42 associations, a second poll was called on Wednesday, in which Utsunomiya bested Yamamoto by 9,720 votes to 8,284, winning in 46 associations.
All 28,700 or so lawyers in Japan had voting rights in the presidential election, with a turnout rate of 63.19 percent. Currently, about 60 percent of the nation’s lawyers belong to either one of the three major bar associations in Tokyo or the one in Osaka, and the candidates supported by the major parties in these associations had always won the presidential elections. However Yamamoto, who despite gaining the backing of the four associations in the latest campaign, failed to win a majority in Osaka in the second vote.
A native of Ehime Prefecture and a member of the Tokyo Bar Association, Utsunomiya started his career as an attorney in 1971. He is a leading expert in consumer affairs, and serves as an acting general manager for the JFBA task force for multiple debt issues, as well as a director of a support group for victims of crimes committed by Aum Shinrikyo cult members. He will be officially appointed as the new president in April and lead the federation for the next two years.

This latest development will make it difficult to pursue further deregulation of bengoshi, and the legal profession more generally (“unification of the profession” or hoso ichigen in its broadest sense: see para 7-230 of ISHIDA, K. & TAYLOR, V. (2008) The Legal Profession of Japan. In NOTTAGE, L. (Exec Ed.) CCH Japan Business Law Guide. Singapore, CCH Asia). That in turn will have a large impact on reform issues such as the expansion of private ADR, as well as the new Law Schools which are already struggling with a National Legal Examination pass rate of only 30% compared to the 70-80% envisaged by the JRC.

Author: Luke Nottage

Prof Luke Nottage (BCA, LLB, PhD VUW, LLM LLD Kyoto) is founding co-director of the Australian Network for Japanese Law (ANJeL), Associate Director (Japan) of the Centre for Asian and Pacific Law at the University of Sydney (CAPLUS), and Professor of Comparative and Transnational Business Law at Sydney Law School. He specialises in international dispute resolution, foreign investment law, contract and consumer (product safety) law.