Tetsuya Toyoda: New Development in Wartime Compensation Cases between South Korea and Japan

It was on 30 August 2011, the Constitutional Court of the Republic of Korea (South Korea) issued a landmark decision on a case of former comfort women claiming compensation from the Japanese government. In view of obtaining compensations for former comfort women, the Court ordered the South Korean Government “to take steps for dispute settlement under Article 3 of the Agreement [of 1965 on the settlement of post-colonial claims]¹⁾.”²⁾  That article provides that “any dispute between the Contracting Parties concerning the interpretation and implementation of the present Agreement shall be settled, first of all, through diplomatic channels” (paragraph 1)  and “any dispute which fails to be settled under the provision of paragraph 1 shall be referred for decision to an arbitration board” (paragraph 2).  In response, the South Korean government asked the Japanese government to renegotiate compensations for former comfort women, but the latter is so far firm in maintaining its position that all issues of post-colonial claims have been settled by the 1965 Agreement.

The Korean judicial activism did not stop there. On 10 July this year, the Seoul High Court ordered a Japanese company, Nippon Steel , to pay 100 million won (approx. $90,000) in compensation to each of the four Korean plaintiffs who went to Japan between 1941 and 1943 after recruiters from that company promised them good jobs, which turned out to be, according to them, forced labor without freedom of movement and without wages for years.  The Seoul court declared that the company, along with the Japanese government, committed “crimes against humanity” through its conscription of laborers during World War II. Later in the same month, on 30 July, the Busan High Court followed suit by ordering Mitsubishi Heavy Industries to pay the families of five former Korean workers, now deceased, 80 million won each.  The Japanese companies appealed, but it is unlikely to see the South Korean Supreme Court overturning the decision. The two companies will then be forced to pay, under the threat of seizure of their assets in Korea. ³⁾  It is said that the Japanese government may bring the case to the International Court of Justice,⁴⁾ under very understandable pressures from the public opinion which vocally demands diplomatic and legal actions to protect the properties of Japanese companies from alleged abusive act of a foreign judicial power. What will follow this judicial imbroglio?

In 1965, the Japanese government agreed to provide US$ 300 million (equivalent of the annual GDP of South Korea at that time) in grant, in addition to US$200 million in loan. In exchange, the South Korean government agreed to the provision that “problem[s] concerning property, rights and interests of the two Contracting Parties and their nationals (including juridical persons) and concerning claims between the Contracting Parties and their nationals, including those provided for in Article IV, paragraph (a) of the Treaty of Peace with Japan signed at the city of San Francisco on September 8, 1951, is settled completely and finally” and that “no contention shall be made with respect to the measures on property, rights and interests of either Contracting Party and its nationals which are within the jurisdiction of the other Contracting Party on the date of the signing of the present Agreement, or with respect to any claims of either Contracting Party and its nationals against the other Contracting Party and its nationals arising from the causes which occurred on or before the said date.” ⁵⁾  Taken literally, it may mean that the Korean government abandoned the rights of individuals to receive compensation for the wrongs they suffered during the Japanese colonization which was particularly harsh during WWII. Then, what are the Korean Constitutional Court and the high courts of Seoul and Busan asking for?

The key to understanding the 2011 judgment of the Constitutional Court is that it was addressed against the South Korean government and not against the Japanese government.  According to the text of the judgment, the South Korean government advocated that “because the Government of Japan, not our Government, is the subject of the unlawful act and the responsibility arising therefrom and because the Government is vested with a wide discretionary power in diplomatic actions, it is impossible to consider the Government as under obligation to take concrete actions.” ⁶⁾  The Constitutional Court denied such a wide discretionary power of the Government not to take diplomatic actions against the foreign government on this issue involving serious violation of human rights. In other words, the Constitutional Court is not necessarily convinced by the South Korean government’s arguments blaming the Japanese government, but it was just asking the government to be consistent.

In the same judgment, the Constitutional Court said:⁷⁾

The respondent [the representative of the Korean government] argues that, given the uncertainty of the outcome after referring the issue to arbitration, the Korean government decided not to claim financial damages from Japan and instead to provide, by  itself, the victims with financial assistance and compensation [which are far from enough]. Even if the infringed rights are significant and there is an urgent risk of violation, it is difficult to impose the duty to take action on the respondent if there is absolutely no chance of providing a legal remedy. However, the duty of action is required not only when a legal remedy is definitely warranted, but also when the possibility of obtaining one exists. In this case, if the victims are willing to take the chance of finally having their claim for damages against the Japanese government denied, the respondent should fully consider the intent of the victims.

In this case, the victims are willing to let the government pursue the justice against the Japanese government in the procedure prescribed by the 1965 Agreement, even if their claim may be denied by the arbitration board then composed.  It is easy to see the frustration of the victims and judges.  While the South Korean government is blaming the Japanese government for the lack of adequate compensation for victims of the wartime exploitation, the former hesitates to take legal actions against the latter because it is not sure whether such an argument is really acceptable when brought before an international judicial (or quasi-judicial, to be precise) body.  The Constitutional Court ordered the Government to go for it unless “there is absolutely no chance of providing a legal remedy.” ⁸⁾

The Constitutional Court is not a diplomatic organ, but a domestic judicial body whose mission is to bring about the rule of law within the country. What it aims to see after this juridico-diplomatic turmoil might be best represented by the Concurring Opinion of Justice Cho Dae-Hyun:

Therefore, the Korean government not only has the duty to resolve the unconstitutionality of the Agreement by taking diplomatic or arbitration procedures against Japan pursuant to Article 3 of the Agreement, but also has to declare its responsibility to fully repay the damages caused by the Agreement by preventing the complainants from exercising their right to claim damages.  Moreover, it is barely possible that the complainants' disrupted exercise of right to claim damages against Japan will be resolved through diplomatic talks or arbitration measures, which are rather likely to result in vain hope and frustration, so it should be further emphasized that the Korean government is obligated to fully compensate for the complainants' claims against Japan.

Whether or not the South Korean government wins the case against the Japanese government is probably not the primary concern of Korean judges.  Its concern is to let the victims receive due compensations.  As far as the domestic legal system, where the South Korean Constitutional Court operated, is concerned, it is the Government’s responsibility to make it happen, whether by itself or by forcing the Japanese government.  All this is based on the assumption that “the Government of Japan, not our Government, is the subject of the unlawful act and the responsibility arising therefrom.”  One may criticize the legitimacy of this very assumption, but it was the assumption presented by the South Korean government and it seems quite appropriate to say that the Constitutional Court does not have the power to question the official interpretation of an international agreement.

For the moment, it is the South Korean judges who have the power to control the events.  By rendering a judgment to uphold the high courts, the Japanese government will then be compelled to accept diplomatic negotiations and the composition of an arbitration board, as provided by article 3 of the 1965 Agreement.  The arbitration board may or may not recognize that the compensation claims of former comfort women and allegedly forced laborer were definitively settled by the 1965 Agreement.  But even if it does, it would not bother the Korean judges, because what is really sought there may be that those victims of wartime exploitation be given an appropriate remedy, be it by the Japanese government or by the South Korean government.

1) The text of the “Agreement on the Settlement of Problems Concerning Property and Claims and on Economic Cooperation between Japan and the Republic of Korea”, concluded on 22 June 1965, is available at: http://www.ioc.u-tokyo.ac.jp/~worldjpn/documents/texts/JPKR/19650622.T9E.html.

2) The decision of the Constitutional Court is available both in Korean original and in English translation at http://www.ccourt.go.kr.

3) Mark Magnier, “Japanese Firm Must Pay War Laborers”, Los Angeles Times, 27 April 27 2002,  http://articles.latimes.com/2002/apr/27/news/mn-40319

4) “Tokyo may seek ICJ role in claims”, Korea Jong Ang Daily, 31 August 2013, http://koreajoongangdaily.joins.com/news/article/article.aspx?aid=2976926&cloc=joongangdaily|home|newslist1

5) Article 2 of the 1965 Agreement, supra note 2.

6) Even though the Constitutional Court’s website provides English translation for most of the text of the judgment, the arguments of parties are not translated, including the sentence quoted above. Here the translation is mine, from the original which reads: “청구인들에 대한 불법행위와 그 책임의 주체는 일본 정부이고 우리 정부가 아니며 , 정부의 외교행위는 넓은 재량이 허용되므로 이 사건 협정에 따른 분쟁해결을 위한 국가의 구체적 작위의무는 인정될 수 없다 .”

7) Supra note 2.

8) Supra note 2.

Tetsuya Toyoda is Associate Professor, Akita International University. He is also Visiting Professor at Far Eastern Federal University (Vladivostok, Russia).