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“Procedural” Apology

by F. Peter Phillips
July 2016

Business Conflict Blog by Peter Phillips

F. Peter  Phillips

Richard Nixon was responsible for many teaching moments.  One of my favorites is the advance in American appreciation of the difference between the passive voice (“Mistakes were made”) and the active voice (“I made mistakes”) that was offered by his press secretary, and echoed by other presidents.

A recent paper by an accomplished New York Law School student presents a similarly tantalizing distinction — the difference between saying “I’m sorry for what I did” and “I’m sorry for the trouble caused.”

Ayana Osada studied the long dispute between Suzuki and Volkswagen, and analyzed part of the problem through the lens of differing cultures and ensuing miscommunication.  Suzuki, as a leading figure in distinctly Japanese industry, was offending by VW’s failure to respond to Suzuki’s request for a “procedural apology.”  What that term means, and the ramifications of not knowing what it means, are parts of a fascinating tale.

Here is a section of Ms. Osada’s paper addressing the provocative topic.  In extracting this section, the footnote numbering has been disrupted and internal references within certain of the footnotes are no longer accurate.

(This excerpt appears with Ms. Osada’s permission.  She is spending the summer at the New York and Tokyo offices of Paul, Weiss, Rifkind, Wharton & Garrison.)

* * * *

Culture of Respect and Apology

Culture is an all-encompassing word; it is easy to blame cultural differences for a host of ADR related problems. However, in the context of ADR with Japanese parties, focus should be on respect and apology because together, they are the essence of dispute resolution in Japan. They explain why separating substance and procedure is helpful and why procedural apology can cure miscommunication and misunderstanding, which are common in cross-border ADR.

For example, when Suzuki demanded an apology from VW and none was forthcoming, it negatively affected their already failing relationship because Suzuki valued this incident far more than VW did. It was missed opportunity because they could have used procedural apology to repair or contain the damage. “We apologize for addressing you without due respect. It was a misunderstanding and miscommunication due to language differences. We are sincerely sorry.” This statement would have sufficed.

From Japanese party’s point of view, demanding an apology is an olive branch extended to the other party. Unfortunately, VW did not recognize it as such. Or perhaps, VW intentionally ignored Suzuki’s demand after doing analysis and calculation. From Japanese perspective, Suzuki was likely not asking VW to admit substantive guilt or liability; Suzuki was attempting to restore their working relationship procedurally.

As Professor Lee describes, this situation is an “example of how law or lawlessness is culturally constructed, and whether the question is not one of law, however defined, but of the local legal culture.”[1] In Japan, which is over 2,000 years old and is a civil law system unlike the United States, parties place as much emphasis on what is respectful and respectable procedurally as they do on what is legal and reasonable substantively.[2] How can parties engaging with Japanese parties in ADR separate substance and procedure to achieve success?

I am Sorry for the Trouble Caused

In Japanese, “gomeiwaku wo kakete moushiwake arimasen” is a well-used phrase between business partners, friends, families, and in virtually all other relationships. Directly translated, it means: I am sorry for the trouble caused.

The phrase is intentionally vague and lacks basic information such as who, what, whom, and why. This phrase may be issued in a press release by a corporation or a politician. It can be used in ADR regarding family disputes, real estate disputes, neighbor disputes, multi-million dollar commercial disputes, and any other disputes.

“Gomeiwaku” means trouble, problem, headache, additional work, wasted work, offense, disrespect, and anything else, which the injured party may resent. The phrase addresses the injured party’s need for apology because that is how the injured party feels. It is purposely vague because details do not matter as much as the fact that apology is given regardless of who did what to whom for what reason. Employees may say this phrase to apologize and bow deeply before television cameras on behalf of their company for producing a defective product. A politician may say this phrase to apologize to his constituents before resigning over a sex scandal. Legal consequences aside, it is perceived as show of respect.

The “trouble caused” can be a specific incident, injury to someone, or general mistrust of a company. Whatever it is, procedural apology expresses contrition and desire to take responsibility without admitting substantive guilt or liability. Here, substance and procedure have been separated with procedural apology. It has not solved the substantive issue such as recalling defective products and paying damages. However, it has begun to restore respect and trust between parties, which are necessary in any successful relationship.

Demanding Apology and Refusing to Apologize

To restore respect and trust between Suzuki and VW, how could procedural apology have benefited VW? Similarly, how could understanding why VW may not apologize have benefited Suzuki?

During their arbitration, both international and Japanese media reported that Osamu Suzuki, the 80-plus year old Chairman of Suzuki, was offended by VW because of the way Suzuki was treated; he felt that VW viewed Suzuki as inferior to VW.[3] In May 2011, when Mr. Suzuki accused VW of disrespecting Suzuki by calling it VW’s “associate” rather than partner in VW’s annual report, VW could have apologized to save Mr. Suzuki’s face but it did not.[4]On another occasion, VW representatives told Suzuki representatives: “If you become a development center, the VW Group will rely on Suzuki, and our fate will be shared[…] Although it is not that we don’t trust you, we don’t know what will happen in the future. The future may bring concerns that you will be controlled by another company.”[5] While VW may have made the statement with no intention of offending Suzuki, Suzuki was reportedly offended because it implied that Suzuki was incompetent, unreliable, and unpredictable.[6]

When there is miscommunication or misunderstanding, what can be done to remedy the problem? If Mr. Suzuki was offended, it may have been in VW’s long term interest to apologize: “Please forgive us, Mr. Suzuki, if we have offended you or your team. Communicating in English, which is our second or third language, can be challenging. If we misspoke, we are deeply sorry.”

Generally, can such procedural, conciliatory, and vague apology resolve substantive issues? Probably not. However, at least for Japanese parties, such apology would go a long way towards building a relationship. It is an indication that past and future miscommunication or misunderstanding may be unintentional because good faith effort was made to show respect.

On the other hand, European and American parties may believe that such procedural apology is not only confusing but also distracting and even insincere. If apology is procedural, substantive issues and “the real problems” are not being addressed. Apology for the sake of formality may confuse the situation and complicate the matter. This may be the thinking of an American corporation, who hesitates to issue an apology after apology is demanded by a Japanese corporation. Because apology means different things in different cultures, it may be undervalued to the detriment of both parties, who miss an opportunity to nip a problem in the bud.

Power of Apology

To varying degrees, apology is valued universally and has been accepted as effective tool in ADR in multiple countries. By 1986, “apology legislation,” which legalizes use of apology as legal remedy, had been introduced in 56 jurisdictions including the United States, United Kingdom, Australia, and Canada to settle a variety of conflicts, including business disputes, family disputes, sexual assault charges on college campuses, and international war crime tribunals.[7] However, fear that apology can be construed as admission of guilt or liability remains in the United States.[8]

It is this strategic thinking, based on which one abstains from apologizing, which offends Japanese parties even more because it indicates that strategy rather than respect is controlling. It is especially disrespectful, the offended Japanese party may conclude, that apology is not forthcoming. The American strategy of rational thinking and self-preservation can be described as “kakehiki” in Japanese. Although kakehiki is just as valuable and inevitable in business in Japan as it is in the United States, it is not necessarily honorable in Japanese psyche. Kakehiki endorses hedging bets and calculating what is most advantageous at the expense of more honorable values such as respect. In contrast, formal apology shows respect, honor, and courage.

Therefore, when problems arise in ADR and apology is demanded, withholding it can be devastating. Parties can end up with more problems than when they started the ADR. This is where procedural apology can be effective because it can cure potentially serious relationship problems quickly without addressing substantive issues so the parties can return to solving the substantive issues.

Crowded Society and Apology

Japan and the United States can be at the opposite ends of the spectrum regarding use of apology. Scholars including Professor Lee have studied “the U.S.­–Japan axis” and explain that Japanese cultural norms, which value respect, community, and harmony, cause them to apologize more readily, when “one’s actions have resulted in the significant injury of another[.]”[9] In contrast, the U.S. inclination is to refrain from apologizing or to deny responsibility in the very same situation.[10]

One relevant factor is geography; Japan is ten times more crowded than the United States. Most Japanese communities are highly populated, in which people must work and live together in harmony for survival. Japan’s population was 127.1 million in 2014 and its surface area was 377,962 square kilometers while the U.S. population was 318.9 million and its surface area was 9,831,510 square kilometers.[11] Comparing their “population density,” which is “people per square kilometer of land area,” the U.S. density was 34.9 while Japanese density was 348.7.[12] The United States is roughly 26 times the size of Japan but Japan’s population is nearly 40% of the U.S. population.[13] Japan is a country, in which the equivalent of almost 40% the U.S. population lives.[14] Yet Japan is “slightly smaller than California.”[15]

Living in a crowded country helps explain why Japanese people value harmony, respect, and keeping face, and why they appreciate apology as show of respect. Avoiding confrontation resolves disputes and conflicts efficiently in Japan because when everyone lives and works in close quarters, parties cannot escape from one another. Confrontation, escalation, and disorder, cannot be permitted in crowded communities because dissenters cannot simply move out west, where there is plenty of land and few people. In Japan, there is little unclaimed land and wilderness. In such crowded communities, independence, individuality, and respectful disagreement, which are valued in U.S. communities, are subordinated. In Japan, it is often easier, more efficient, and ultimately beneficial to everyone, to apologize. Strategizing and avoiding admission of guilt or liability would likely aggravate the matter. Therefore, lack of apology, when it is expected, is that much more devastating to Japanese parties.

Law and ADR that Reflect Host Culture

Law and ADR systems generally reflect each country’s “societal inclination or disinclination to apologize.”[16] In Japan, legal institutions have reinforced societal use of the apology and integrated it into the country’s justice system. To resolve conflicts quickly and to have finality, Japanese courts regularly demand apology from parties. Professor Lee explains: “The culture of Japan is such that all of society, including the bench and bar, expects and demands an apology from a party causing harm or injury to another.”[17]

In the United States, apology is not typically a part of civil or criminal court proceedings. Courts can ask parties to apologize. However, even in ADR, apology may not be mandatory because “the societal inclination not to apologize in the U.S. setting is matched (and perhaps shaped) by a legal culture that advises clients not to issue an apology for fear that it may be used against the apologizer as an admission of legal liability.”[18] Therefore, apology is not given high “legal priority” and “legal doctrine based on apology” is not as well developed in the United States.[19]

“You Should Know Better”: High Context v. Low Context

To convey that a person is better than his or her own misguided conduct, expression, “you should know better,” is used in the United States and in Japan. However, the Japanese version implies this notion: “You lack common sense that all of us in this community unquestionably share, which means that you are showing disrespect.” Assuming that everyone shares the same common sense is a mistake, which Japanese parties can make due to geographical and cultural conditioning.

The reason Suzuki was offended by VW may have been that Suzuki assumed that VW should know better. VW must know that it should not call Suzuki an associate because they are equal partners, Suzuki assumed. It may not occur to Suzuki that VW representatives simply misspoke or misused some words. Suzuki assumed that VW knew better and yet, VW called them an associate rather than partner. Therefore, Suzuki was offended. Similarly, Suzuki likely assumed that VW knew or should have known that VW must apologize; it is common sense. Yet VW refused to apologize. Therefore, Suzuki was further offended.

“Joshiki shirazu,” meaning “lacking common sense,” is an expression used to describe conduct that is frowned upon in Japan. In a small and crowded island country with long history of interdependent agricultural communities and limited immigrant population such as Japan, common sense enables collective survival.

In contrast, in a large country made up of immigrants with frontier spirit, where multiracial, multi-ethnic and multi-religion communities coexist, such as the United States, common sense and assumptions are not dependable. Instead, freedom, pluralism, and tolerance for those who disagree with us, are valued. Many Americans living in large cities such as New York City, especially, do not assume that our neighbors, coworkers, and business partners, share the same customs and common sense. People in diverse communities must keep an open mind to learn from each other; we learn by compromising and communicating. Therefore, people are not so easily offended if there is misunderstanding or miscommunication.

In Japan, however, people are conditioned to assume that everyone shares the collective common sense, rendering disregard for common sense particularly disrespectful. Refusing to apologize can be offensive to many Japanese parties, when it may be dismissed as harmless by many Americans, who are conditioned to expect that people from different cultures have different customs.

[1] Ilhyung Lee, Introducing Int’l Com. Arb. and Its Lawlessness, By Way of the Dissenting Opinion, 4(1) Contemp. Asia Arb. J. 19, 27 (May 31, 2011),http://ssrn.com/abstract=1867886.

[2] Introduction to Japan’s Legal System, Library of congress,http://www.loc.gov/law/help/legal-research-guide/japan.php (last visited May 22, 2016).

[3] Anna Mukai, Suzuki Starts Arb. with Volkswagen to Buy Back Shares, BLOOMBERGBUSINESS (NOV. 24, 2011), www.bloomberg.com/news/articles/2011-11-24/suzuki-starts-arbitration-with-volkswagen; Hans Greimel, How the VW-Suzuki Alliance Went Wrong, AUTOMOTIVE NEWS (Aug. 3, 2015),http://www.autonews.com/article/20150803/OEM/308039944/how-the-vw-suzuki-alliance-went-wrong.

[4] Mukai, supra note 11; Greimel, supra note 11.

[5] Mukai, supra note 11; Greimel, supra note 11.

[6] Mukai, supra note 11; Greimel, supra note 11.

[7] Robyn Carroll et. al., Apology Legis. and its Implications for Int’l Disp. Resol., 2015-9 UWA FACULTY OF LAW RESEARCH PAPER 115–117 (2015),http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2677033.

[8] Id.

[9] The Law and Culture of the Apology, supra note 8 at 2.

[10] Id.

[11] World Dev. Indicators: Japan, The World Bank,http://databank.worldbank.org/data/reports.aspx?source=2&country=JPN&series=&period= (last visited May 22, 2016); World Dev. Indicators: United States, The World Bank,http://databank.worldbank.org/data/reports.aspx?source=2&country=USA&series=&period= (last visited May 22, 2016).

[12] World Dev. Indicators: Japan, supra note 19; World Dev. Indicators: United State., supranote 19.

[13] World Dev. Indicators: Japan, supra note 19; World Dev. Indicators: United State., supranote 19.

[14] World Dev. Indicators: Japan, supra note 19; World Dev. Indicators: United State., supranote 19.

[15] The World Factbook, Central Intelligence Agency,https://www.cia.gov/library/publications/the-world-factbook/fields/2023.html (last visited May 2, 2016).

[16] The Law and Culture of the Apology, supra note 8 at 2.

[17] Id.

[18] Id.

[19] Id.

[20] The Law and Culture of the Apology, supra note 8 at 10.

[21] Id.

[22] Id.

[23] Id.

[24] Id.

Biography


F. Peter Phillips is a commercial arbitrator and mediator with substantial experience providing consultation on the management of business disputes to companies around the globe.

A cum laude graduate of Dartmouth College and a magna cum laude graduate of New York Law School, Mr. Phillips served for nearly ten years as Senior Vice President of the International Institute for Conflict Prevention and Resolution (CPR Institute). During that time, he earned a reputation as an author, teacher, industry liaison, and systems designer for the avoidance, management and resolution of complex and sophisticated business conflicts.

In 2008, Mr. Phillips formed Business Conflict Management LLC (BCM) in order to offer his direct services as a neutral and a consultant. Through BCM, Mr. Phillips also continues his career as a highly sought-after public speaker, facilitator and instructor.



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