Hi Blog. I think I’ll let Terrie do the talking today. Important day tomorrow I’m currently preparing for. You’ll see why it’s important… tomorrow! Arudou Debito in Sapporo
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A weekly roundup of news & information from Terrie Lloyd.
General Edition Sunday, July 26, 2009 Issue No. 527
+++ WHAT’S NEW
The Japan Times has been doing a good job recently of documenting consumer rights law cases and also foreigner- related issues that might be of use to its readers. Last week they reported on a landmark court ruling, whereby the Kyoto District Court said that a landlord’s insistence on contract renewal fees (“koshinryo”) may violate the rights of the tenant. This is the first time such a case has been ruled in favor of the tenant.
In the case, the tenant was apparently told that there would be a contract renewal fee, but not why. Presumably the agent thought that because the renewal fee is a traditional payment, dating back to post-war times when the government didn’t want returnee soldiers relocating en masse to the cities, they didn’t go into it in any detail. In any case, as a result of that oversight, when the plaintiff moved out several months after he’d paid the renewal and the landlord refused to refund the payment, the tenant took offense and took the landlord to court.
The basis for the lawsuit was the 2001 revised consumer protection law, which the court agreed had precedence over the tenancy law. In the ruling the judge apparently commented that, “The reasons for charging contract renewal fees must be clearly explained to tenants and agreed upon between the two sides.”
Now before everyone starts hooting from the roof tops that it’s time for landlords to get some of their own medicine, it’s worth remembering that this is the exact same Kyoto District Court that in January of last year dismissed a very similar lawsuit. In that earlier case, the tenant also based his claim on the 2001 consumer contract law, where he said that renewal fees in the way they are currently notified and imposed, constitute a contract that “Unilaterally causes damage to the interests of consumers.” We daresay that a lot of readers would agree with that statement!
It seems that the point of legal consideration by the two different Kyoto law court judges wasn’t whether the renewal fees are allowed under consumer law or not — they are, so long as the landlord or the agent explains clearly that the fees are part of the contract and that the tenant knowingly and willingly signs the contract. Rather, the consideration was all about whether the fee’s purpose was clearly explained — thus allowing the tenant to claim that he wasn’t fully informed and therefore permitting him to invoke the consumer protection law.
So, the requirement to pay rent renewal fees, as onerous as they are, has not gone away. It’s just now that it’s possible to claim ignorance to the rules, and use that to get your money back. This is not a strong step forward for tenant’s rights, but at least it’s a start…
As most readers would be aware, the renewal fees are not the only sticking point when it comes to renting Japanese apartments. There is also the non-refundable deposit and the “cleaning fees” to be deducted from that deposit when you move out. Most people who have moved apartments more than once have learned that very little of their 2-3 months refundable deposit will actually come back — a good reason, of course, why people don’t move so often.
We’ve heard a variety of opinions about whether tenants can fight the imposition of cleaning fees — especially if you’ve cleaned the apartment thoroughly enough that it doesn’t need much more polishing. Certainly you CANNOT not pay them, since the fees are generally taken out of the deposit paid when you first moved in. The general guideline, apparently is for a cleaning fee of JPY1,000~JPY1,500 per sq. m. of apartment floor area — which for a JPY100K apartment might leave you with the grand total of just JPY50,000 from your original JPY200,000~JPY300,000 of refundable deposit being returned.
Talking to a certain large rental agent for foreigners, we have heard that the situation is quite different in the non-Japanese sector. Largely because expat apartments tend to be bigger and more expensive to keep vacant, and because there is also a dearth of tenants, landlords are being much more flexible and cooperative. They are cutting deals that strictly Japanese-facing landlords would never dream of. The deals include no-deposit contracts, 3-6 months free rent on a two-year lease (just like B- and C-grade offices), and large price cuts of up to 50% discount.
But as we’ve noted, one man’s cloud is another’s silver lining. Word is that there are plenty of local foreigners and Japanese moving into the more fashionable districts in Tokyo right now — because they’re trading up into the gaijin apartments, but not having to pay much difference for all the extra space, appliances, and convenience.