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●Laws Concerning Contracts Including Sales Contracts and Lease Contracts●

The Civil Code is a basic law for contracts, and provides fundamental thinking for sale and purchase contracts and lease contracts as well.
While the Civil Code makes it a principle to treat parties in contractual relationship in an equal and fair manner, there arises differences in negotiation ability and information volume, etc. between operators and consumers when buying, selling or leasing land, building and other real properties.
​Accordingly, aside from the Civil Code, laws have been enacted to protect consumers, preventing transactions from being disadvantageous for consumers. 

Civil Code (Ministry of Justice)

The Civil Code provides fundamental thinking on contracts, including requirements for conclusion of contracts, earnest money and warranty against defects. ​Where disputes arise between the parties or if there is no arrangement between them, the settlement shall, in principle, be sought based on the Civil Code.

Building Lots and Buildings Transaction Business Act (Ministry of Land, Infrastructure, Transport and Tourism)

For sale and purchase contracts in which building lots and buildings transaction business operators themselves serve as the seller, the Building Lots and Buildings Transaction Business Act provides regulations including restrictions on part of the contract content from the viewpoint of consumer protection, in spite of the provisions of the Civil Code. Specifically, the law provides limits to the amount of earnest money and cancellation penalty, etc. and restrictions on the warranty against defects. Contract provisions that contravene these restrictions shall become invalid. On the other hand, the Building Lots and Buildings Transaction Business Act has no special regulations on the content of lease contracts. ​In principle, the contracts are handled pursuant to the Act on Land and Building Leases, the Civil Code and the Consumer Contract Act, among other rules.

Act on Land and Building Leases (Ministry of Justice)

From the viewpoint of lessee protection, the law is applicable prior to the provisions of the Civil Code to lease contracts for lands (for the purpose of owning buildings) and buildings. For example, the law provides the duration and renewal of land leasehold, the term, renewal and termination of building lease contracts, etc. ​The law also has provisions on fixed term lease and fixed term building lease. In addition, the law includes an article stipulating that, even if the contracting parties reach agreement that is different from legal provisions, the provisions on the Act on Land and Building Leases shall apply (such provisions are called “mandatory provisions.”)

Consumer Contract Act (Cabinet Office)

From the viewpoint of consumer protection, the Consumer Contract Act has provisions that are applicable prior to the Civil Code to the contracts concluded between business operators and consumers (called “consumer contracts”), as there are differences in negotiation ability and information volume, etc. between such business operators and consumers. ​Specifically, the provisions allow cancellation of contracts if they were concluded while the consumers misunderstood them or remained puzzled as a result of inappropriate acts of the business operators. Moreover, the law has such provisions that nullify the articles, if any, of contracts that unduly harm the rights of consumers.