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Minority Shareholders, Chapter 25: A Meeting of Reversed Fortune

Mukoujima Transport engages a lawyer as the founder's widow puts the president's job on the line in Chapter 25 of Shin Ushijima's novel, Minority Shareholders.



In this chapter of Minority Shareholders, I continue the story of Norio Takano. He is not a specific person; he is a character created for my book out of some high rollers who had existed during the bubble period.

As a young lawyer, I witnessed the generation of enormous wealth from scratch. A minority shareholder of a family company brought an action to the court and succeeded in taking hundreds and thousands of yen. I saw it firsthand. Ten years after the bubble popped, I started work related to corporate governance. In this book, my fictional characters tell the story of problems that persist in joint-stock corporations. What is an organization called a company? What if Norio Takano were reborn in this era?

This story is a work of fiction. Any resemblance to actual characters or organizations is entirely coincidental and unintentional. ー Shin Ushijima

Read earlier chapters of the series.

Minority Shareholders
Book cover, "Minority Shareholders" by Shin Ushijima.

CHAPTER 25: A Meeting of Reversed Fortune

Continuing from Chapter 24: Kousuke Momoi went over to Mukoujima Transport to inspect the accounting records of the company. He discovered rock-solid evidence to prove foul play on the part of Kensuke Kajita, the president. And he urgently needed to talk to Saori Mitsuda for confirmation. That was the reason why Momoi excitedly dialed her number.

Momoi's voice drifted into the quiet room late at night. "So this woman by the name of Mitsue Nakano is the one you were talking about the other day?"


Momoi wanted to confirm it with Saori Mitsuda. Having laid down the receiver of the landline, Momoi pumped his right fist in the air and bolted from his office into Nishida's office. Immediately after that, a late-night meeting started at the firm.

The First Formal General Shareholders' Meeting

Mukoujima Transport had never held an ordinary general shareholders' meeting other than through due formalities since its foundation. As for board meetings, the president would simply summon board members, and so they called it a "board meeting." They had repeated that custom for a long time. So not only Kensuke Kajita, the president, but all of the board members had no idea what a real board meeting would be like. 

Still worse was their general shareholders' meeting. Once a year at a board meeting of some sort, the chief of the administration department seated behind the president would whisper to him saying, "Please announce the commencement of the general shareholders' meeting after this." 


The president would nod his head nonchalantly. He would read out the order of a ceremony that the chief of the administration department had made beforehand and confirm the dividend amount. And then he would call the names of any newly-appointed directors or retiring directors. That was all. No one was asked to voice any issues; no one dared to speak.

When a general shareholders' meeting of some sort was to be held, the chief of the administration department would send a convocation notice to the shareholders listed on the shareholder register in advance. It was only for the sake of formality, but none of the shareholders attended.

No one had been inconvenienced by that custom.

Stamping the Administrative Records

On the advice of Nakagawa, the tax accountant, the registration of the board members and the president had been done in accordance with the law. For that purpose, every two years Nakagawa produced the necessary documents. They included meeting minutes, for the general shareholders' meeting and board of directors' meeting, none of which reflected what had actually happened at such meetings. 

The chief of the administration department took the liberty to complete the documents. He then affixed the seals of the board members or auditor on them. Nothing else had been done. Nothing inconvenient had arisen from that within Mukoujima Transport. 

But this time things did not happen the way they were expected to. 

A content-certified mail with the names of lawyers including Tadashi Ooki and six others was sent to Kensuke Kajita, the president. He was greatly shocked to see that his dismissal was proposed as an agenda item. 

He had taken offense when two young lawyers barged into the company, asking for inspection of the accounting records. But Nakagawa, his tax accountant, had properly dealt with it. He had said to Kensuke Kajita reassuringly, "The accounting records are carefully and neatly kept and duly inspected by the tax office. So there is nothing problematic about them."

But Kensuke Kajita had misgivings that something terrible was on the horizon this time. He asked Nakagawa to introduce a lawyer to him as soon as possible.

A few days later, he received a phone call from Nakagawa, who told him to visit an office in Hirakawa-cho to meet with an attorney named Mr Maehara. He went to Maehara's office on the appointed date and time. Nakagawa was waiting for Kensuke there.


A Lawyer for the Company

Toshitake Maehara was over forty and had practiced law for fifteen years. He had set up his own law firm seven years before. Except for Maehara, there was only one young lawyer in the firm. 

When Kensuke Kajita made an inquiry about the content-certified mail, which he had copied and sent in advance to Maehara as a PDF file, Maehara's face clouded. "She seems to be legally entitled to submit the proposal."

"Sensei, what on earth does my aunt actually want to do? The shares of the company are mostly owned by my wife and me, so I'm pretty sure that my dismissal will never be accepted." Kensuke Kajita responded with confidence to what Maehara had said. 

Maehara said, "Is that so? You and your wife own most of the shares? Then it's no problem. In that case, Mr Kajita, I think there is a hidden agenda behind her actions. 

"They know very well that the shareholder proposal will be rejected, yet they're going to submit it anyway. It means that they need to deliberately let the rejection of the proposal happen. 

"Mr Kajita, her attorneys' law firm is owned by Mr Ooki and is a household name to everyone in the legal field. It has an established reputation in the field of business law for providing top-notch legal services. It's a big firm boasting a lineup of more than eighty lawyers." 

He continued, "My guess is that the firm has accepted this case because they are certain of something that makes them believe that they will be successful. I wonder what that is." After speaking, Maehara released a small sigh. A middle-aged spare tire around his belly bobbed up and down beneath his protruding chin.

Kensuke Kajita's Disavowal

"Eh, what do you mean?" Kensuke Kajita asked briskly. 

Nakagawa shrugged, cocking his head inquiringly. 

"Well, I can see they're going to file an action for dismissal within thirty days upon rejection. They see the rejection at the ordinary shareholders' meeting as just a pass point. Considering that, I assume that they have ample evidence to prove the existence of 'misconduct or material facts in violation of laws and regulations or of the articles of incorporation' in connection with your business. 


"You said they had inspected your accounting records, but found nothing wrong, right?"

"Right. I got the assurance from Mr Nakagawa."

Nakagawa gave them a big nod.

"Yes, Mr Nakagawa told me so too, but…," he equivocated. He stopped short of mentioning the possibility that Kensuke Kajita seated before him was responsible for some misconduct. Maehara had just been asked by Nakagawa, his acquaintance, to take care of the general shareholders' meeting of the company. But he did not have a clue as to how far he could trust this man, Kensuke Kajita.

Lawyers sometimes get such a request. But they need to be prudent because some people who have done wrong approach them in an attempt to misuse the names of lawyers. 

Maehara's Conflicted Confidence

This time, Nakagawa, who was his acquaintance and had a certain reputation as a tax accountant, acted as a go-between. That worked to lessen his anxiety. But Maehara thought: 

{Mr Ooki's law firm has undertaken this matter, which means that they certainly have a good reason. They must have confidence. So I have to brace myself for possible contingencies down the road. Otherwise, we may incur unexpected consequences. 

{Even though Mr Nakagawa assured me that he had found nothing wrong in the accounting records, he mentioned it from the viewpoint of taxation purely from a practical perspective. He is just a tax accountant working with areas of expertise different from those of lawyers. It may have been of no problem in terms of tax procedures. But he cannot be relied on to perform sufficient legal analysis.} 

Maehara could not take his mind away from that suspicion. Of course, he could not voice it blatantly in front of Nakagawa.

"Mr Kajita, since I am a lawyer, I need to question you as a matter of course. Please allow me to ask you some questions which may sound offensive to you," he said softly. "Do you happen to remember anything that might have led them to misunderstand what you did…something that led them to misconstrue your actions?" Maehara asked.


"I'm sorry?" Kensuke Kajita took a moment to register the question. Never did he dream that his own lawyer would be questioning him as though he were being interrogated by a policeman. He came to sense that Maehara was indirectly asking him if he was committing or had committed any wrongdoings. 

Kensuke's Denial

"No," he replied in as calm a manner as possible. Kensuke thought that this was the best way to reply to the insolent question as a gentleman. In order to emphasize that he had no clue, he thought that the reply should be the simplest. 

"No, of course, you don't. I bet you don't," Maehara said simply. After a little pause, he asked, "You mentioned that your accounting records had been inspected. What did they actually look at?"

"They said something like a breakdown of expenses. I don't know much about it, but Mr Nakagawa knows. I'll also ask an accounting staff member who is helping Mr Nakagawa and report it to you later."

"It's nothing. They had been accepted by the tax office, too." Nakagawa chimed in.

Upon their explanation, Maehara was somewhat convinced and went on to explain about the general shareholders' meeting. 

Who Owns the Company

Maehara was well-versed in the practical knowledge about general shareholders' meetings because he had handled a great deal of work relating to shareholders' meetings when he was at a big law firm before. He kindly taught them the details about the proceedings of meetings, arrangements of desks, and all other necessary things for general shareholders' meetings.

Maehara said, "As to the three companies which together own a 51% stake in Mukoujima Transport, you are the president of these three companies. I would like to ask who owns the shares of these three companies."

"My wife and I do. Oh, plus my children," he answered honestly.

"I see. You and your wife do. Well, it's no problem then," Maehara said.


When Kajita was about to leave the firm, he asked Maehara about the lawyer's fee, but Maehara dodged the question, implying that he wanted to talk about it later after the general shareholders' meeting.

Arranging a General Shareholders' Meeting

The general shareholders' meeting of Mukoujima Transport was arranged at a large meeting room. It was next to the very meeting room where the board members had usually gathered. Maehara came to the company before and on the day of the meeting, He saw to it that the arrangements had been made thoroughly. 

As they had a rehearsal beforehand, Kensuke Kajita felt that he was able to face the meeting with confidence. {Great! I feel I am well-armed.} Kajita said to himself. A smile spread across his face.

Kajita was to preside over the meeting. He had asked Maehara to sit just behind him. 

When Maehara's attendance at the meeting was determined, Kajita had felt in his bones that it would cost a lot. He realized at last why Maehara had dodged the question about his fee. It would not have helped if Maehara talked about his lawyer's fee with a client who did not yet have any idea how much assistance would be required. Maehara knew it from fifteen years of experience as a lawyer.

Kensuke Kajita had had his tax accountant solve all the problems that had arisen in past real estate transactions. He had never thought of becoming involved in a legal action on his own. When trouble happened and it was likely to be brought to court, he had always turned to Nakagawa to settle the matter peacefully.

Having asked a lawyer to do some work for him for the first time, Kensuke Kajita was a little surprised to find that lawyers were well-meaning people, compassionately taking care of their clients. He had had preconceptions that lawyers were stern and pompous men with graying hair.

Who Sits Where

Desks were neatly set in the meeting room. The chairman's seat was in one row, behind which small desks were lined up sideways. The other five rows of chairs were all set across from the chairman like a school classroom.

Kensuke Kajita seated himself in the middle of the row as chairman. It was stipulated in the company's articles of incorporation that the president of the company be the chairman. Flanking him on either side were his wife, who was a director, and two additional directors on each side. 

Saori Mitsuda was seated in the third row across from the chairman, waiting for the general shareholders' meeting to begin. In front of and behind Saori's row were two rows of chairs in which no one was seated. There were other board members and employees who were also shareholders of the company. But none of them attended except Saori Mitsuda.


Behind Kensuke Kajita, seated at small desks, were the chief of the administration department and the chief of the accounting department with two of his subordinates as well as Maehara and Nakagawa as an auditor.

Saori Mitsuda dressed herself in an elegant suit with a pattern of gray and black small squares randomly combined. She wore a little makeup but applied lipstick bright enough to show off her lips. She had spruced herself up just for that general shareholders' meeting. 

The small eighty-nine-year-old woman ensconced herself in a folding chair at a gray refectory office table. And she stared at Kensuke Kajita straight in the face.

When her husband was alive, Saori Mitsuda would sit next to him without any idea what was going on. At the time, the seats were arranged in the shape of a square. 

A Reversal of Fortunes

It had been thirty-seven years since her husband had died. Except for Kensuke Kajita and his wife Shino, no one remembered the wife of the then-president. But the name Mitsuda reminded them of the founder. And they stared at her with a kind of curiosity, thinking that this woman may be her. 

Saori instantly noticed Shino, who was seated next to President Kajita. She realized that it was now Shino Kajita who stood tall as the wife of the president of the company. Saori was distressed by the reality of their stark difference in position. 

It was the company her husband had founded, but nobody knew Saori. A big reed-shaped white paper printed with the title of director was hanging from the desk in front of Shino Kajita. Shino Kajita was definitely eligible to be seated in this meeting room. 

In contrast to Shino, Saori found her situation miserable. Reduced circumstances…the two words entered her head. 

She hastily placed three pieces of A4 paper in her lap and started reading the contents silently. Momoi had produced the documents. Saori had read them over and over and practiced what she was going to say with the help of Momoi multiple times. She had memorized all the questions and answers.

Saori shifted her eyes to Shino Kajita seated before her. She had known Shino well before Shino got married. Shino Kajita looked at the distant wall as though glowering, but tried to avert her eyes away from Saori.


Continues in: Minority Shareholders, Chapter 26: A Playboy President in the Spotlight


Minority Shareholders
Shin Ushijima, Esquire

Minority Shareholders is a work of fiction and any similarity to real characters, companies and cases is purely coincidental and unintentional. Sign up to join our mailing list and look for the next chapter every Saturday on JAPAN Forward.

Author: Shin Ushijima

The founding partner of Ushijima & Partners, lawyer Shin Ushijima has an enormous wealth of experience in international transactions, mergers, and acquisitions, dispute resolution, system development, anti-monopoly law, labor, and tax law. Concurrently, he heads an NPO called the "Japan Corporate Governance Network." And in his leisure moments, he writes fiction. Additional details on Shin Ushijima's career, awards, publications, and more are available at his website: Ushijima & Partners, Attorneys-at-Law.


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