For the cases to collect money from the other party, the attorney will generally handle these cases in the following way.
1. Review the evidences and see if the client should move forward.
2. Send a demand letter (content certified mail) to the company in Japan.
The attorney fee for the step 1 and step 2 is 88,000 yen. (Additional fee may be charged, if the case requires additional working time compared to usual cases.)
3. If the company doesn’t cooperate or doesn’t reply, then the attorney will try to negotiate with the other party, or file a lawsuit.
The attorney fee for negotiating and filing a lawsuit (step 3) is generally calculated from the amount to claim (hourly charge is also available for some cases). However, the legal fee will be usually more than 660,000 yen.
4. If the company doesn’t pay (or cooperate) even after getting the court’s order, the attorney will proceed to the court enforcement procedure (See this page)
It may also cost more than 330,000 yen plus tax for doing the above written step 4 (even the procedure may end up in vain).
In Japan, generally you cannot make the other party to pay these legal expenses, and we request our clients to pay the initial fee in advance.
Additionally, even if you file a lawsuit and get the court’s order for payment, it does NOT directly mean you can actually get the money. If the other party has no asset, it is not possible to be paid from them anyway. So, usually, if the amount of damage is below certain amount, it may not be cost effective to file a lawsuit for collecting money.
However, we have experienced many issues solved by sending a letter from the attorney. Therefore, it is recommended to send a demand letter (the above written step 1 and step 2). You can then consider about how to proceed, depending on the other party’s response.
To avoid future troubles, it is strongly recommended to trade with trustworthy companies when you start the international trading. Also, make sure to get a copy of the official company registration of the other party before starting the trades (we can obtain a copy for you if you request). This is because in some cases (which are likely to be fraud), we cannot even locate the address of the other party.