Friday, July 31, 2015

The Case of Zhong Wei Shipping vs. Mitsui

The recent public apology Mitsubishi Materials extended to American POW for their stint as labor slaves in Japan during WWII followed by the company’s offer to pay damages to Chinese prisoners who also served as slave labor was widely acclaimed as the first legal win for Chinese victims of Japanese atrocities in WWII. In the course of doing my research, I found that even if Mitsubishi goes forward and actually pay indemnification; theirs was not the first for Chinese plaintiffs.

That dubious honor goes to the Chen family who doggedly pursue justice from Mitsui that span three generations. Finally, in April 2014 the grandson was awarded a judgment of RMB 260 million (about $43 million) on a lawsuit his grandfather initiated. This is widely regarded as the landmark case in the history of China Japan relations.

The grandfather, Chen Shuntong (陈顺), started as a dock worker at age 14 and became the owner of Zhong Wei Shipping, then China’s largest shipping company by 1930 when he was 35. In 1936, the predecessor Japanese company to Mitsui signed a one-year lease for the use of Shunfeng and Xintaiping. With the capacity of more than 6000 tons and 5000 tons respectively, those were at the time considered the largest and state-of-the-art ships in China.

By 1937, Japan and China were officially at war and the ships were never returned to the owner. Upon conclusion of the WWII, Chen found out that both ships sank and were lost at sea during the conflict. The War and the loss of his ships led to deep depression and drove him to bankruptcy. He fell ill and died in November 1949. On his deathbed, he made his son swore to continue to pursue justice from the Japanese.

His son, Chen Qiaqun, left Shanghai and began to pursue justice out of Hong Kong. In 1962, he went to Japan and because Japan’s imperial navy had commandeered the ships, he began to seek compensation from Japan’s government before the Tokyo district court. The court ruled in 1974 that the statues of limitation on this suit had expired. End of the story in Japan.
In 1987, China’s court ruled that because the lease signed in 1936 took place in Shanghai and the principals were residing in Shanghai as were the ships in question, then the court in Shanghai has jurisdiction over the case. Next year Chen Qiaqun again filed the case on behalf of the Zhong Wei company. The first hearing in the Shanghai Maritime Court上海海事法院) took place on August 15, 1991

In April 1992, Qiaqun passed away due to illness and he again made his two oldest sons promise to carry on the wishes of their grandfather. Between 1995 and 2003, there were four more hearings in court. Finally on December 7, 2007 the Shanghai court ruled that Mitsui, the successor owner, owed the Chen family 2.916 billion Yen or equivalent to 200 million Renminbi. At that time, this case was celebrated as the longest running case against a Japanese entity and the largest award for damages.

But that was not the end of the story because Mitsui did not take the case to China’s higher court nor pay the damages. On April 19, 2014, the Shanghai court seized a ship belonging to Mitsui for not honoring the ruling of the court. This move caught Mitsui by surprise and caused a sensation in Japan. The spokesman from the foreign affairs ministry of both countries quickly exchanged public statements into a media standoff.

Four days after the seizure, Mitsui appeared before the Shanghai court and paid 4 billion Japanese yen equivalent to 260 million Renminbi. Next morning, the ship was released to Mitsui.

Lesson learned from this story: Victims of Japanese WWII atrocities had no recourse until recently, only becoming possible now that China has become an economically strong nation and a judiciary system willing to hear cold cases more than 70 years old. It’s worth noting that the court in China did not rush to judgment but took the time to examine the issues involved.

My thanks to Thekla Lit for calling the original material in Chinese to my attention.

My friend, Professor Ivy Lee, has reminded me that there have been other cases that settled between Chinese slave laborers and Japanese companies. Somehow these cases have always led to controversy as is the case with the current pending cases.

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