## Facts

- American President Lines, Ltd. (APL) (plaintiff) owned a ship that was chartered by Subra Kabushiki Kaisha (Subra) (defendant), a Japanese company.
- The charter contract contained an arbitration clause requiring disputes to be resolved by arbitration in New York.
- A dispute arose under the charter, and APL commenced arbitration in New York under the contract’s arbitration clause.
- The arbitration panel consisted of three arbitrators: one selected by APL, one selected by Subra, and a third selected by agreement of both parties.
- The arbitration panel awarded APL $48,396.76 in damages.
- A United States district court confirmed the arbitration award and directed Subra to pay interest.
- Subra partially satisfied the award.
- APL then brought an action in Japan seeking enforcement of the unpaid balance of the award and the interest directed by the U.S. district court.

## Issues

1. Whether a Japanese court will recognize and enforce a New York arbitral award (as confirmed by a U.S. district court) against a Japanese defendant.
2. Whether, if enforcement is available, the Japanese court will also enforce the interest directed by the U.S. court in connection with confirmation of the award.

## Decision

- The Tokyo District Court refused to enforce the New York arbitral award in Japan.
- Because enforcement was denied, APL could not recover in Japan the remaining unpaid portion of the award or the interest directed by the U.S. district court through this action.

## Legal Principles

- A foreign arbitral award is not enforceable in Japan simply because it was validly made abroad; enforceability depends on the requirements of Japanese law governing recognition and execution.
- In the pre–New York Convention setting reflected by this case, Japanese courts took a restrictive approach to enforcing foreign arbitral awards absent a clear statutory or treaty basis.
- A Japanese court may deny enforcement of a foreign award where the legal conditions for recognition are not satisfied, including limits tied to public order and to the treatment of comparable Japanese decisions abroad (reciprocity-type concerns).
- Confirmation of an arbitral award by a foreign court does not, by itself, guarantee that the award (or the confirmation-related interest component) will be executable in Japan.

## Conclusion

American President Lines sought to collect in Japan the unpaid balance of a New York arbitral award—plus interest ordered when a U.S. district court confirmed the award—arising from a ship charter containing a New York arbitration clause, but the Tokyo District Court declined to enforce the foreign arbitral award in Japan.


American President Lines, Ltd. v. Subra Kabushiki Kaisha, 10 Kakyū Minshū 2232 (1959)