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2018 (Kyo) 1

2019.01.23
2018 (Kyo) 1
Minshu Vol. 73, No. 1
Decision concerning whether or not an order of seizure issued against a co-ownership interest succeeded to by an obligor as a result of a joint succession of book-entry transfer shares, etc. that have been entered or recorded in an account, which is held under the name of a decedent and opened in a book-entry transfer account register, is appropriate
Case of appeal with permission against the ruling of the court of appeal against execution to revoke a transfer order
Decision of the Second Petty Bench, quashed and remanded
Osaka High Court, Decision of December 4, 2017
1. In the case where book-entry transfer shares, book-entry transfer beneficial interests in an investment trust and book-entry transfer investment equities ("book-entry transfer shares, etc.") that have been entered or recorded in an account held under the name of a decedent and opened in a book-entry transfer account register were jointly succeeded to, an order of seizure issued against the co-ownership interest succeeded to by an obligor as a result of such joint succession cannot be found illegal by the mere fact that the book-entry transfer shares, etc. have not been entered or recorded in an account held under the name of the obligor.

2. The fact that a petition for a transfer order is filed with respect to a co-ownership interest succeeded to by an obligor as a result of a joint succession of book-entry transfer shares, book-entry transfer beneficial interests in an investment trust and book-entry transfer investment equities cannot promptly lead to a conclusion that the execution court may not issue a transfer order.

(There is a concurring opinion regarding 2.)
(Regarding 1 and 2) Article 66, Article 121, Article 128, paragraph (1) and Article 226, paragraph (1) of the Act on Book-Entry Transfer of Corporate Bonds and Shares and Articles 896 and 898 of the Civil Code

(Regarding 1) Article 150-2 of the Rules of Civil Execution

(Regarding 2) Article 150-7, paragraph (1), item (i) of the Rules of Civil Execution



Act on Book-Entry Transfer of Corporate Bonds and Shares

(Ownership of Rights)

Article 66 The ownership of rights (other than a claim for interest prescribed in Article 73) under a corporate bond as set forth below which is handled by a Book-Entry Transfer Institution (hereinafter referred to as a "Book-Entry Transfer Corporate Bond" in this Chapter) is established by the entries or records in a Book-Entry Transfer account register as under the provisions of this Chapter:

(i) a corporate bond that satisfies all of the following requirements (referred to as a "short-term corporate bond" in Article 83):

(a) the amount of each corporate bond is no less than one hundred million yen;

(b) provisions have been made establishing a fixed due date for the redemption of the principal that is within one year from the day on which the total amount for the corporate bonds is paid in, and no provisions have been made for payment by installment;

(c) provisions have been made establishing that the due date for the payment of interest is the same day as the due date for the redemption of the principal as referred to in (b);

(d) the bond is not secured by collateral pursuant to the provisions of the Secured Bonds Trust Act (Act No. 52 of 1905).

(ii) a corporate bond that is provided for in a decision to issue corporate bonds establishing that all corporate bonds issued based on that decision will be subject to the application of this Act.



(Mutatis Mutandis Application of Provisions on Bonds and Other Securities to Beneficial Interest in Investment Trusts)

Article 121 The provisions of Chapter IV (other than Article 66, item (i) Article 71, paragraph (8) and Section 4 (other than Article 84, paragraph (2), Article 85, paragraph (1) and Article 86-2, paragraph (1))), Article 114, paragraph (2) and Article 155, paragraph (8) apply mutatis mutandis to a beneficial interest in an investment trust (meaning a beneficial interest as prescribed in Article 2, paragraph (7) of the Act on Investment Trusts and Investment Corporations, and including a beneficial interest under the trust agreement of a foreign investment trust; the same applies hereinafter). In such a case, the words set forth in the right-hand column of the following table are deemed to replace the words set forth in the middle column of that table in the provisions set forth in the left-hand column thereof, and beyond this, Cabinet Order provides for the necessary technical replacement of terms.

Article 66

claim for interest/claim to a distribution of profits

Article 66, item (ii)

decision to issue/the basic terms and conditions of the investment trust (meaning the basic terms and conditions of an investment trust as prescribed in Article 4, paragraph (1) or Article 49, paragraph (1) of the Act on Investment Trusts and Investment Corporations);and

issued based on that decision will be subject/will be subject

Article 67, paragraph (1)

Corporate bond certificates/Beneficiary certificates (meaning beneficiary certificates as prescribed in Article 2, paragraph (7) of the Act on Investment Trusts and Investment Corporations; the same applies hereinafter)

Article 67, paragraphs (2) and (3)

corporate bond certificate/beneficiary certificate

Article 68, paragraph (3), items (iii) through (v), paragraph (4), item (ii), and paragraph (5), item (ii)

amount/number of units

Article 69, paragraph (1)

without delay after the date on which it issues/if a trust has been set up for

Article 69, paragraph (1), item (i)

that it has issued/that it has placed in trust

Article 69, paragraph (1), item (iv) to item (vi)

the amount of book-entry transfer corporate bonds as referred to in item (i) for each Participant;/the number of book-entry transfer corporate bonds as referred to in item (i) for each Participant

Article 69, paragraph (1), item (vii)

total amount/total number of units

Article 69, paragraph (2)

the amount/the number of units;and

increase equal to the amount/increase equal to the number of units

The part of Article 69-2, paragraph (1) other than what is listed in the items of that paragraph

company/trustee (in the case of the investment trust managed under instructions from the settlor prescribed in Article 2, paragraph (1) of the Act on Investment Trusts and Investment Corporations, the settlor; the same applies hereinafter);

the company/the trustee;and

consolidation-type merger/merger of trusts

Article 69-2, paragraph (1), item (i)

company/trustee;and

notify...or apply for a book-entry transfer/notify

Article 69-2, paragraphs (2) to (5)

company/trustee

Article 70, paragraph (1)

showing a reduction or increase/showing a reduction or increase equal to the number of units

Article 70, paragraph (2)

reduction/reduction equal to the number of units

Article 70, paragraph (3), item (i)

showing a reduction and increase/showing a reduction and increase equal to the number of units;and

amount/number of units

Article 70, paragraph (3), item (ii)

reduction/reduction equal to the number of units

Article 70, paragraph (3), items (iii) and (iv)

increase/increase equal to the number of units

Article 70, paragraph (4), item (i)

the amount/the number of units;

amount subject to book entry transfer/number of units subject to book entry transfer;and

reduction/reduction

Article 70, paragraph (4), items (iii) and (iv)

amount subject to book entry transfer/number of units subject to book entry transfer;and

increase/increase

Article 70, paragraph (5), item (i)

amount subject to book entry transfer/number of units subject to book entry transfer;and

reduction/reduction

Article 70, paragraph (5), items (iii) and (iv), and paragraph (7)

amount subject to book entry transfer/number of units subject to book entry transfer;and

increase/increase

Article 70-2, paragraph (2)

notice...or an application for a book-entry transfer/notice;

merger/merger of trusts;

company/trust:

shares/beneficial interest;

shareholder register/beneficial interest register (meaning the beneficial interest register prescribed in Article 186 of the Trust Act as applied mutatis mutandis pursuant to Article 6, paragraph (7) of the Act on Investment Trusts and Investment Corporations following the deemed replacement of terms; the same applies hereinafter);and

that notice or application for a book-entry transfer/that notice

Article 71, paragraphs (1) and (2)

reduction/reduction equal to the number of units

Article 71, paragraph (3)

reduction/reduction equal to the number of units;and

amount/number of units

Article 71, paragraph (4), item (i) and paragraph (5), item (i)

amount/number of units;and

reduction/reduction

Article 71, paragraph (7)

Unless an issuer goes through a corporate bond manager or a trust company under a trust agreement as prescribed in Article 2, paragraph (1) of the Secured Bonds Trust Act (referred to as a "bond manager or similar person" in the following paragraph) to redeem book-entry transfer corporate bonds for a bondholder or pledgee, the issuer may demand that/The issuer may demand that;

redeeming/redeeming or cancelling;

being redeemed/being redeemed or cancelled;and

the same amount from the account as the amount of/the same number of units from the account as the number of units of

Article 73

claim for interest/claim to a distribution of profits;and

showing an increase equal to the amount/showing an increase equal to the number of units

Article 74

increase/increase in the number of units

Article 77

showing an increase in/showing an increase equal to the number of units of;and

the increase/the increase

Article 78, paragraph (1)

total amount/total number of units;

the total issued amount (other than any amount that has been redeemed)/the total issued units (other than any units that have been redeemed or canceled);

aggregate amount/aggregate number of units;

total issued amount/total number of issued units;

amount of the overage/number of units in overage;

,less the total issued amount/,less the total number of issued units;and

amount/number of units

Article 78, paragraph (2)

amount/number of units;and

increase or reduction/increase or reduction

Article 79, paragraph (1)

aggregate amount/aggregate number of units;

amount/number of units;

amount of the overage/number of units in overage;

,less the total issued amount/,less the total number of issued units;and

in an amount equal to/in a number equal to

Article 79, paragraph (2)

amount/number of units;and

increase or reduction/increase or reduction

Article 79, paragraph (3)

amount of the overage/number of units in overage;and

in an amount/in a number of units

Article 79, paragraph (4), item (ii)

amount/number of units

Article 79, paragraph (5), item (i)

reduction equal to the amount/reduction equal to the number of units

Article 79, paragraph (5), item (ii)

increase equal to the amount/increase equal to the number of units

Article 80, paragraph (1)

amount/number of units;

total amount/total number of units;

amount of the overage/number of units in overage;

any amount representing/any number of units representing;

,less the total issued amount/,less the total number of issued units;

the amount arrived at when/the number of units arrived at when:

this Article and Article 85/this Article;

maximum amount ascribable to the book-entry transfer institution/maximum number of units ascribable to the book-entry transfer institution;

redeem the principal or pay interest on/redeem, cancel or distribute profits for;

maximum amount ascribable to the account management institution/maximum number of units ascribable to the account management institution;and

aggregate amount/aggregate number of units

Article 80, paragraph (2), item (i)

maximum amount ascribable to the book-entry transfer institution Limit Amount for the Book-Entry Transfer Institution/maximum number of units ascribable to the book-entry transfer institution Limit Number of Units for the Book-Entry Transfer Institution;and

redeem the principal or pay interest on/redeem, cancel or distribute profits for

Article 81, paragraph (1)

amount/number of units;

total amount/total number of units:

amount of the overage/number of units in overage;

any amount representing/any number of units representing;

, less the total issued amount/, less the total number of issued units;

the amount arrived at when/the number of units arrived at when;

this Article and Article 85/this Article;

maximum amount ascribable to the account management institution/maximum number of units ascribable to the account management institution;

redeem the principal or pay interest on/redeem, cancel or distribute profits for;and

aggregate amount/aggregate number of units

Article 81, paragraph (2), item (i)

maximum amount ascribable to the account management institution Limit Amount for the Account Management Institution/maximum number of units ascribable to the account management institution Limit Number of Units for the Account Management Institution;and

redeem the principal or pay interest on/redeem, cancel or distribute profits for

Article 82

amount/number of units;and

redeem the principal or pay interest on/redeem, cancel or distribute profits for

Article 84, paragraph (2)

corporate bond register/beneficial interest register

Article 85, paragraph (1)

Article 723, paragraph (1) of the Companies Act/Article 17, paragraph (6) of the Act on Investment Trusts and Investment Corporations;

the amount of corporate bonds held thereby (other than the sum total of the maximum amount ascribable to the book-entry transfer institution and maximum amount ascribable to the account management institution)/the number of units held thereby (other than the sum total of the maximum number of units ascribable to the book-entry transfer institution and maximum number of units ascribable to the account management institution);and

bondholders meeting/resolution referred to in paragraph (1) of that Article

Article 86-2, paragraph (1)

a company surviving an absorption-type merger (meaning a company surviving an absorption-type merger as prescribed in Article 749, paragraph (1) of the Companies Act; the same applies hereinafter) or the wholly owning parent company resulting from a share exchange as prescribed in Article 767 of that Act (hereinafter collectively referred to as the "surviving or wholly owning company" in this Chapter and Chapters VII through IX,); or a company incorporated in a consolidation-type merger (meaning a company incorporated in a consolidation-type merger as prescribed in Article 753, paragraph (1) of that Act) or the wholly owning parent company incorporated in a share transfer as prescribed in Article 773, paragraph (1), item (i) of that Act (hereinafter collectively referred to as the "incorporated or wholly owning company" in this Chapter and Chapters VII through IX ) seeks to deliver book-entry transfer corporate bonds at the time of the absorption-type merger or share exchange (hereinafter collectively referred to as an "absorption-type merger or share exchange" in this Chapter and Chapters VII through IX) or at the time of the consolidation-type merger or share transfer (hereinafter collectively referred to as a "consolidation-type merger or share transfer" in this Chapter and Chapters VII through IX)/If a beneficial interest that will be extinguished in a merger of trusts is not a Book-Entry Transfer Beneficial Interest in an Investment Trust and the trustee seeks to deliver a beneficial interest at the time of the merger,;and

the effective date of the absorption-type merger or share exchange or the date of incorporation of the incorporated or wholly owning company (hereinafter collectively referred to as the "effective date or date of incorporation" in this Chapter and Chapters VII through IX)/the effective date of the merger of trusts

Article 87, paragraph (1)

referred to in Article 69, paragraph (1)/set forth in the following items;and

take measures, using the means prescribed by Cabinet Order, that will enable the Participants to learn the information set forth in item (vii) of that paragraph/take measures, using the means prescribed by Cabinet Order, that will enable the Participants to learn the information set forth in these items/(i) notice under Article 69, paragraph (1): information set forth in item (vii) of that paragraph/(ii) notice under the first sentence of Article 121-3, paragraph (1): information set forth in item (v) of that paragraph

Article 155, paragraph (8)

Article 192, paragraph (1) of the Companies Act/Article 18, paragraph (1) of the Act on Investment Trusts and Investment Corporations (including the cases where applied mutatis mutandis pursuant to Article 54, paragraph (1) of the Act)





Article 128, paragraph (1)

(1) The ownership of rights under a share (other than a share with a restriction on transfer) in a company not providing for the issuance of share certificates in its articles of incorporation, which is handled by a Book-Entry Transfer Institution (hereinafter referred to as a "Book-Entry Transfer Share"), is established by the entries or records in a Book-Entry Transfer account register as under the provisions of this Chapter.



(Ownership of Rights)

Article 226, paragraph (1)

(1) The ownership of rights from investment equity (meaning investment equity as prescribed in Article 2, paragraph (14) of the Act on Investment Trusts and Investment Corporations; the same applies hereinafter) handled by a Book-Entry Transfer Institution (hereinafter referred to as "Book-Entry Transfer Investment Equity") is established by the entries or records in a Book-Entry Transfer account register as under this Section.



Civil Code

(General Effect of Inheritance)

Article 896 From the time of commencement of inheritance, an heir shall succeed blanket rights and duties attached to the property of the decedent; provided that this shall not apply to rights or duties of the decedent that are purely personal.



(Effect of Joint Inheritance)

Article 898 If there are two or more heirs, the inherited property shall belong to those heirs in co-ownership.



Rules of Civil Execution

(Commencement of Execution Against Book-entry Transfer Company Bonds, etc.)

Article 150-2 Compulsory execution in respect of company bonds, etc. as prescribed in Article 2, paragraph (1) of the Act on Book-entry Transfer of Company Bonds, Shares, etc. (Act No. 75 of 2001) which are handled by a Book-entry Transfer Institution (meaning a book-entry transfer institution as prescribed in paragraph (2) of said Article; the same applies hereinafter) (such company bonds are hereinafter referred to as "Book-entry Transfer Company Bonds, etc." and such execution is hereinafter referred to as "Execution Against Book-entry Transfer Company Bonds, etc.") commences through the issuance of an order of seizure by the execution court.



(Order to Transfer Book-entry Transfer Company Bonds, etc.)

Article 150-7, paragraph (1), item (i)

(1) Upon petition by the obligee effecting a seizure, the execution court may issue the following orders with regard to the Book-entry Transfer Company Bonds, etc. subject to the seizure; provided, however, that, if said Book-entry Transfer Company Bonds, etc. are Book-entry Transfer Bonds, etc. or Book-entry Transfer Company Bonds with Share Options That Have Been Extinguished, this is limited to when the due date for redemption of the principal has yet to arrive or to when it is difficult to collect said Book-entry Transfer Company Bonds, etc.:

(i) an order to transfer said Book-entry Transfer Company Bonds, etc. to the obligee effecting a seizure at the price specified by the execution court, in lieu of payment (hereinafter referred to as an "Order to Transfer Book-entry Transfer Company Bonds, etc."); or
The decision in prior instance is quashed.

This case is remanded to the Osaka High Court.
Reasons for an appeal stated by the counsels for appeal, AKAI Katsuji, WAKAMATSU Yutaka and MUKAI Hiromi

1. The appellant alleged that the other party, who is a heir of deceased A, and four other persons have jointly succeeded to shares, beneficial interests in an investment trust and investment equities ("shares, etc.") recorded in an account that is held under the name of deceased A and opened in a book-entry transfer register held by SMBC Nikko Securities Inc., which is an account management institution as defined in Article 2, paragraph (4) of the Act on Book-Entry Transfer of Corporate Bonds and Shares (hereinafter referred to as the "Corporate Bonds, etc. Transfer Act"), and that the other party holds a co-ownership interest in such shares, etc. (hereinafter referred to as the "Interest"). Based on such allegation, the appellant filed a petition for an order of seizure (hereinafter referred to as the "Order of Seizure") with respect to the Interest against the opponent as an obligor and the Order of Seizure was issued.

In this case, the appellant filed a petition (the "Petition") for a transfer order with respect to the Interest which was seized based on the Order of Seizure.

2. The court of prior instance dismissed without prejudice the Petition by determining as summarized below.

(1) In light of the fact that the Corporate Bonds, etc. Transfer Act stipulates to the effect that the ownership of rights under a corporate bond prescribed in Article 2, paragraph (1) of that Act which is handled by a book-entry transfer institution (hereinafter referred to as a "book-entry transfer corporate bond") is established by the entries or records (hereinafter referred to as "records, etc.") in a book-entry transfer account register, it may be construed that, in a compulsory execution procedure concerning book-entry transfer corporate bonds, etc., the execution court should examine whether or not the obligor holds the book-entry transfer corporate bonds, etc., which are subject to an order of seizure, based on the records, etc. in a book-entry transfer account register and may not issue an order of seizure against book-entry transfer corporate bonds, etc. for which records, etc. are created in an account [held] under the name of a person other than the obligor. Therefore, as long as no records, etc. are created in an account held under the name of the other party with respect to the shares, beneficial interests in an investment trust and investment equities related to the Interest, the Order of Seizure is illegal, and thus the Petition is unlawful.

(2) While records, etc. can be created in an account held under the names of all coheirs with respect to book-entry transfer corporate bonds, etc. which have been jointly succeeded to, records, etc. of a co-ownership interest in such book-entry transfer corporate bonds, etc. cannot be created in an account held under the name of any one of the coheirs. Moreover, a transfer based on a transfer order cannot come into effect even if the transfer order issued with respect to such co-ownership interest becomes final and binding, and thus the execution court may not issue such transfer order and the Petition is unlawful.

3. However, none of the abovementioned determinations of the court of prior instance can be upheld for the following reasons.

(1) The Corporate Bond, etc. Transfer Act stipulates that ownership of rights under book-entry transfer shares, book-entry transfer beneficial interests in an investment trust and book-entry transfer investment equities (hereinafter collectively referred to as "book-entry transfer shares, etc.") is established by the records, etc. in a book-entry transfer account register (Article 128, paragraph (1) with respect to book-entry transfer shares; the main paragraph of Article 66 as applied mutatis mutandis by replacing certain terms pursuant to Article 121 with respect to book-entry transfer beneficial interests in an investment trust; and Article 226, paragraph (1) with respect to book-entry transfer investment equities). It may also be construed that book-entry transfer shares, etc. held by a decedent are automatically succeeded to by an heir upon commencement of succession and that the status as a person who opened an account for an account management institution to make a book entry transfer of book-entry transfer shares, etc. will also be succeeded to by the relevant heir as in the case described above (main clause of Article 896 of the Civil Code). As such, book-entry transfer shares, etc. for which records, etc. are created in an account held under the name of a decedent may be regarded to be those for which records, etc. are created in an heir's account. This would be no different in the case of joint succession.

Accordingly, it is reasonable to consider that, in the case where book-entry transfer shares, etc. for which records, etc. are created in an account held under the name of a decedent are jointly succeeded to, an order of seizure issued against a co-ownership interest succeeded to by an obligor as a result of such joint succession cannot be found illegal by the mere fact that records, etc. have not been created with respect to the book-entry transfer shares, etc. in an account held under the name of the obligor.

(2) Even if records, etc. of a co-ownership interest in book-entry transfer shares, etc. which were jointly succeeded to cannot be created in an account held under the name of any one of the coheirs, it cannot be said that a transfer based on a transfer order does not come into effect as a result of the transfer order becoming final and binding with respect to such co-ownership interest. Moreover, it should be said that there are no reasons to find that the execution court may not issue a transfer order with respect to any asset, the transfer of which is not prohibited under laws and regulations and which has legally become subject to an order of seizure, by the mere fact that the asset is a co-ownership interest in book-entry transfer shares, etc.

Accordingly, it is reasonable to consider that the fact that a petition for a transfer order was filed with respect to a co-ownership interest which an obligor succeeded to as a result of a joint succession of book-entry transfer shares, etc. cannot promptly lead to a conclusion that the execution court may not issue the transfer order.

4. The determinations of the court of prior instance to dismiss without prejudice the Petition based on views different from those described above contain violation of laws and regulations that obviously affects the judicial decision. The counsels' arguments are well-grounded and the decision in prior instance should inevitably be quashed. This case is remanded to the court of prior instance to be further examined.

Accordingly, the Court unanimously decides as set forth in the main text of the decision. However, there is a concurring opinion of Justice ONIMARU Kaoru.

The concurring opinion of Justice ONIMARU Kaoru is as follows.

I would like to give my opinion as described below, in relation to the Court's opinion which held that the fact that a petition for a transfer order was filed with respect to a co-ownership interest which an obligor succeeded to as a result of a joint succession of a book-entry transfer share, etc. cannot promptly lead to a conclusion that the execution court may not issue the transfer order.

Under the Corporate Bonds, etc. Transfer Act, even if records, etc. of a co-ownership interest in book-entry transfer shares, etc. cannot be created in an account held under the name of any one of the co-owners alone, it can be easily assumed that the book-entry transfer shares, etc. will be co-owned upon commencement of succession. In light of this fact, it cannot be construed that an account management institution is prohibited from opening an account to be held under the names of all co-owners of the book-entry transfer shares, etc. (hereinafter referred to as the "joint account") and creating records, etc. with respect to such book-entry transfer shares, etc., which are co-owned, in the joint account (the court of prior instance seems not to have denied this). Based on this premise, it can be considered that an obligee effecting a seizure who obtained a transfer order with respect to a co-ownership interest succeeded to by an obligor, who is one of the coheirs, as a result of the book-entry transfer shares, etc. becoming subject to a joint succession can not only effect partition of property in co-ownership with all of the coheirs except the obligor without changing the state thereof for which records, etc. are created in the account held under the name of the decedent and become the sole owner of such property but also indicate him/herself as one of the co-owners by making book entries to the joint account held by the obligee effecting a seizure and all of the coheirs except the obligor from the account held under the name of the decedent with respect to the book-entry transfer shares, etc. that include the obligor's co-ownership interest. Specifically, it seems that the following method can be taken: first, all of the coheirs except the obligor in addition to the obligee effecting a seizure jointly apply for the opening of a joint account to be held by the obligee effecting a seizure and all of the coheirs mentioned above to a specific account management institution and have such account management institution open the abovementioned joint account; following this, a court clerk and all of the coheirs mentioned above apply to the account management institution which opened the account under the name of the decedent for book entries to the abovementioned joint account from the account held under the name of the decedent with respect to the book-entry transfer shares, etc. that include the obligor's co-ownership interest, after a transfer order issued against the obligor's co-ownership interest becomes final and binding, thereby creating records, etc. in the abovementioned joint account.

However, in order to realize the abovementioned book-entry method, an account management institution must open a joint account, but such treatment seems not to be widely conducted in reality for book-entry transfer shares, etc. In addition, it is difficult to deny that it is necessary to obtain cooperation from all of the coheirs except the obligor in order to open a joint account or apply for book entries after a transfer order becomes final and binding with respect to the obligor's co-ownership interest and if such cooperation is not obtained, there may be difficulties in realizing the abovementioned book entry method (it is also necessary to examine whether or not a court clerk may apply, jointly with all of the coheirs mentioned above, for book entries of book-entry transfer shares, etc. which are co-owned and the legal basis for such application). As such, the abovementioned book entry method may cause a situation where rights cannot be exercised based on a transfer order with respect to an obligor's co-ownership interest. Moreover, the claim and execution costs of an obligee effecting a seizure are deemed to have been performed at the transfer value determined by the execution court as of the time of service of the transfer order upon the relevant account management institution when such transfer order becomes final and binding (Article 160 of the Civil Execution Act as applied mutatis mutandis pursuant to Article 150-7, paragraph (6) of the Rules of Civil Execution). This results in a situation where the obligee effecting a seizure has no choice but to assume the abovementioned risk in the end. It cannot be considered that an obligee effecting a seizure, who effects a seizure of book-entry transfer shares, etc. which are not legally stipulated as seizure-prohibited assets, is expected under laws to bear risks in the realization of such book-entry transfer shares, etc. due to constraints in book-entry methods. In addition, book-entry transfer shares, etc. for which records, etc. are created in an account held under the name of a decedent constitute part of the estate and there is no basis to treat such book-entry transfer shares, etc. in a manner different from other parts of the estate. Thus, under ordinary circumstances, it is desirable to establish a system under laws and regulations where an account management institution opens a joint account in response to an application and the rights of an obligee effecting a seizure can be easily exercised based on a transfer order issued against an obligor's co-ownership interest without obtaining the cooperation of persons other than the obligee effecting a seizure. Under the current situation, the realistic way for an obligee effecting a seizure to exercise his/her right is to achieve realization of an obligor's co-ownership interest by effecting partition of property in co-ownership with all of the coheirs except the obligor with respect to the book-entry transfer shares, etc. including the obligor's co-ownership interest after the transfer order becomes final and binding. However, as long as there is the option to take that method, a petition for a transfer order for an obligor's co-ownership interest should not be found illegal.
Justice ONIMARU Kaoru

Justice YAMAMOTO Tsuneyuki

Justice KANNO Hiroyuki

Justice MIURA Mamoru
(This translation is provisional and subject to revision.)