## Facts

- A Japanese corporation importing German automobiles contracted with a Japanese national who had lived in Germany for over twenty years to supply cars purchased and shipped from Germany to Japan.
- The corporation remitted foreign-currency funds to a bank account in Germany designated by the supplier for vehicle purchase and related costs.
- A dispute arose and the corporation sought return of the remitted funds on contract and/or unjust enrichment theories; the supplier refused repayment.
- Most performance-related conduct and much documentary and testimonial evidence (e.g., banking and shipping records) were located in Germany.
- The corporation sued in Japan; the trial court dismissed for lack of international jurisdiction, and the case reached the Supreme Court after appellate review.

## Issues

1. Whether Japanese courts may determine international civil jurisdiction by analogical application of domestic venue provisions when the dispute has substantial foreign connections.
2. Whether, even if a domestic venue ground is satisfied, a Japanese court may refuse jurisdiction based on fairness and procedural economy, and under what standard.
3. Whether the circumstances of this dispute justified declining jurisdiction because the case was predominantly connected to Germany.

## Decision

- The Supreme Court reversed the dismissal and held that Japanese courts had international jurisdiction over the action.
- The Court stated that international jurisdiction is generally recognized when a case fits within domestic venue provisions, applied with attention to the dispute’s nature.
- The Court held that jurisdiction may be denied only in limited, exceptional circumstances where litigating in Japan would be manifestly unreasonable.
- The Court found no such exceptional circumstances here and remanded for further proceedings on the merits.

## Legal Principles

- In the absence of explicit statutory rules on international jurisdiction, courts determine international jurisdiction primarily by analogical application of domestic venue provisions of the Code of Civil Procedure.
- Satisfaction of a venue basis is not always sufficient; courts must also consider whether exercising jurisdiction is fair and appropriate in light of all circumstances.
- A court may decline jurisdiction only when exceptional circumstances make adjudication in Japan manifestly inappropriate, considering factors such as the location of evidence, burden on the defendant, parties’ ties to Japan and the foreign forum, and overall fairness and efficiency.
- The exceptional-circumstances limitation is narrow and does not confer broad discretion to refuse jurisdiction merely because another forum appears more convenient.

## Conclusion

The Supreme Court held that Japanese courts generally may exercise international jurisdiction when domestic venue analogies support it, and that refusal is permitted only in rare cases where proceeding in Japan would be manifestly unreasonable; the lower court’s jurisdictional dismissal was therefore reversed and the case returned for adjudication.


K.K. Family v. Miyahara, 51 Minshū (No. 10) 4055 (Sup. Ct. Japan 1997)