Tokyo Barrister: Start the law firm bankruptcy

Chapter 865 Good Faith Acquisition

Morning, 10:12.

Eto Law Firm.

Kitahara and Miyakawa are considering how to deal with Nippon Steel next. Since they went to Nippon Steel headquarters that day, Nippon Steel has been silent for a long time and has not made any substantive response. Obviously, the other party is using delaying tactics. So how to deal with it next?

Suddenly, footsteps were heard outside the door.

The glass door of the law firm was pushed open.

It was Niwa who came in.

"Something big happened! About Nippon Steel!" Niwa said anxiously as soon as he entered the door.

"What is it?" Hearing Niwa's anxious tone, Miyakawa couldn't help but stand up from his chair.

Kitahara also looked up at Niwa. In Kitahara's calculations, Nippon Steel should be doing something right now. However, due to the lack of information, they still could not grasp the internal dynamics of Nippon Steel.

"It's the Nippon Steel Union!" Niwa said, "The Nippon Steel Union is going on strike!!"

"So sudden?" Beiyuan was also a little surprised. "What's the reason?"

It would certainly not be easy for a union of the size of Nippon Steel to launch a strike.

It is difficult for a union to initiate a strike if it does not win over a sufficient number of workers.

If it really comes to this, then there must have been a drastic change within Nippon Steel.

"Kitahara, take a look at this." Niwa placed a pamphlet on the desk. This pamphlet was exactly what the union had been promoting to its members recently.

There were a few big words printed on the booklet:

Prevent banks from embezzling Nippon Steel's assets.

"It is said that the whole process was like this," Niwa said. "The Toyama secretary of the union discovered that the bank's accountant had put the bank's asset number on the production equipment in the Nippon Steel factory. As a result, the union also found out that Nippon Steel had to mortgage a large amount of production equipment to the bank in order to obtain financing. The union could not accept this, so they broke up completely."

Niwa's words had just fallen.

Then another figure appeared at the door of the law firm.

It was the contractor Shiga.

"Lawyer Kitahara!" Shiga also rushed over in a hurry, "Lawyer Kitahara! Have you heard?! The union of Nippon Steel is going to go on strike! Now the news has spread!"

Everyone gathered in the law firm.

Kitahara turned on the TV and switched to the news channel.

Sure enough, the news was being broadcast at this time.

The female host on the screen was giving a quick report, "According to the latest news, the Japan Steel Workers' Union plans to launch a full-scale strike in the near future. Currently, the strike plan has been submitted to the union for internal review. After it is approved by the majority of union member representatives, the strike will be launched."

"We understand that the main reason for this strike is that Nippon Steel is going to mortgage most of its factory assets to banks in exchange for loans, which has aroused strong dissatisfaction from the union. The reason for this strike reflects that Nippon Steel may be in financial difficulties and is seeking external financing. This coincides with the market rumors that Nippon Steel is seeking interest waivers."

"Nippon Steel is currently caught in a dilemma of being levied tariffs overseas and its overseas steel revenue falling sharply. The strike by the union will mean that Nippon Steel's factories will be completely paralyzed. This will further trigger the problem of buyers' 'cancelling orders'. Buyers may cancel their orders to Nippon Steel due to the strike, or hold Nippon Steel liable for breach of contract."

The TV screen also showed the real-time price of Nippon Steel's overseas dollar bonds. At this moment, Nippon Steel's overseas dollar bonds plummeted by more than 9 points.

The decline showed no signs of easing.

After all, the reason for the union's strike was that they disagreed with the factory's asset mortgage, which confirmed the previous market rumors. Soon, Nippon Steel's bonds were sold in a panic. The bonds of this largest steel company in the East, which used to be a safe haven asset, have now become a hot potato that everyone is avoiding.

"Things may be more complicated than we thought." Kitahara said while watching the TV. "The union wants to prevent the asset mortgage by going on strike, but it is very likely that these assets have actually been mortgaged. This may be very disadvantageous to you, Mr. Shiga."

"Why?" Shiga said, "Many of the production equipment are invested by us. Why can Nippon Steel mortgage our assets to the bank? Such mortgage should be invalid!!"

Kitahara shook his head and said to Shiga:

"You may not know this. In civil law, there is a system called 'good faith acquisition'."

【Good Faith Acquisition】

[That is, if a person who has no right of disposal sells something to an uninformed buyer, as long as the price is reasonable, the buyer can become the legal owner. For example, you lend a laptop to a friend. The friend then resells the computer to someone else. If the price paid by the other person for the computer is reasonable, then the other person can become the legal owner of your laptop, and you will not be able to recover the computer.]

"Good...good faith acquisition system?" Shiga said in disbelief, "Will this have any impact on me?"

"To put it simply -" Kitahara said, "even if the production equipment in the factory is yours, as long as the bank completes the registration of the mortgage procedures, the mortgage right is valid."

"What?!" Shiga almost froze in place when he heard Kitahara say that.

Currently, the debts that Nippon Steel owes him are mainly the pending settlement amounts for steel products and the equipment investment funds that he is required to repay.

If his investment in the Nippon Steel Workshop would become collateral for the bank, then the loss would be almost irreparable. Think about it, a production line in the steel industry can easily cost tens of millions of yen. Such a huge investment would eventually become collateral for the bank, and Shiga could not accept this result at all.

"The law... How can the law stipulate this?!" Shiga's expression was a little dazed. "Those production equipment... are... are they all gone?"

In the hall, everyone fell silent for a moment.

Yes, judging by the speed of the banks, I am afraid that the mortgage registrations for most of the factory assets are being processed.

So many lawyers and accountants were sent out, and these people are not here to eat for free.

It is estimated that the assets have been numbered and registered as quickly as possible, and the mortgage procedures have been started at the city hall.

The union was so angry that it wanted to go on strike, probably because it saw that the situation was irreversible.

That's why he reacted so violently.

If this is the case, what will happen to the workshop contractor's claims?

You should know that the bank's mortgage right is the highest priority among all debt claims.

Legally, it is almost impossible to fight the banks.

Once the mortgage is established, the possibility of recovering the debts of the workshop contractor represented by Shiga is—

zero.

(End of this chapter)