This is the first case in which funds from a Japanese company have been transferred to a plaintiff following a trial related to wartime forced labor, the lawyer of the plaintiff said.

The Japanese engineering corporation’s funds were deposited at the Seoul Central District Court to prevent the company’s assets in South Korea from being seized and liquidated to compensate the plaintiff.

In late January, the court granted the plaintiff’s request to seize the funds, following a December ruling by the top court that ordered Hitachi Zosen to pay the plaintiff 50 million won ($37,400) in damages.

The company deposited 60 million won at the Seoul court in 2019.

Hitachi Zosen and other sued Japanese firms have refused to compensate victims of wartime labor as the Japanese government has said all issues stemming from its colonization of the Korean Peninsula from 1910-1945 were settled “completely and finally” under a 1965 bilateral agreement.

In Tokyo, Japan’s Chief Cabinet Secretary Yoshimasa Hayashi emphasized that the decision by South Korea’s top court to compensate the plaintiff was in violation of the bilateral agreement.

“This brings unreasonable loss to the Japanese company. It is extremely regrettable,” the top government spokesman said, referring to the deposit.

In December and January, the top court rejected appeals from Hitachi Zosen and three other Japanese firms, finalizing the plaintiffs’ win in the cases.

The court’s decisions came amid an improvement in Japan-South Korea ties following Seoul’s announcement in March last year that plaintiffs who won lawsuits over forced labor would receive compensation from a South Korean government-backed foundation rather than the sued firms.

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