Contract Forms
Labo-type & Ukeoi-type

The right contract form depends on your project. How firm are the requirements? How should the risk be shared? Understanding the difference between labo-type (quasi-mandate) and ukeoi is the first step to choosing the best approach and driving your project to success.
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01

The essence

Read by color ― Navy = Labo-type (flexible, process-based) / Vermilion = Ukeoi-type (fixed, outcome-based)

Labo-type ContractUkeoi-type Contract
Quasi-mandate

Labo-type Contract

Labo-gata ・ selling “effort”

You secure a dedicated team for a set period and pay for the man-hours and time invested. The vendor works with due professional care, but does not promise the completion of a specific deliverable.

Payment
By man-month / hours
Duty
Due care (diligent work)
Completion duty
None
Spec changes
Flexible
Risk
Leans to the client
Contract for work

Ukeoi-type Contract

Ukeoi-gata ・ selling the “deliverable”

The vendor commits to completing a predefined deliverable and delivering it. Payment is made against completion and handover; the price is typically fixed (lump sum).

Payment
Fixed price (deliverable-based)
Duty
Duty to complete
Non-conformity liability
Yes (defect warranty)
Spec changes
Needs a change order
Risk
Leans to the vendor
02

Side-by-side comparison

Each row is a real question you face when signing and running the contract.

AspectLabo-typeQuasi-mandateUkeoi-typeContract for work
ObjectWhat is soldLabor & effort — the team’s time and skillsA finished deliverable — the result itself
Completion dutyNone — no obligation to produce a deliverableYes — paid only upon completion & delivery
PaymentHow it’s calculatedBy man-month / hours. Stable monthly cost, easy to budgetFixed price for the scope. Total known upfront
Non-conformity liabilityDefect warrantyNone in principle (no deliverable is warranted)Yes — repair, price reduction, or damages
Spec changesChanging requirementsVery flexible — suits agile & fluid requirementsRigid — scope changes need a re-quote & change order
Best whenLong-term, requirements still fluid, keep team & know-howScope clear, spec fixed, want lump-sum & risk transfer
Client-side riskHigher — pay for hours even if the outcome is uncertain; needs managementLower — no deliverable, no payment; risk shifts to the vendor
03

Two ways of working

Labo-type runs as an Agile (Scrum) iterative cycle; ukeoi-type follows a one-way waterfall flow.

Labo-type (quasi-mandate)

Agile / Scrum
01

Product Backlog

02

Sprint Planning

03

Design (basic & detailed)

04

Development · Daily Scrum

05

Sprint Review

06

Retrospective

↻

Repeat next sprint

Back to the first step (agile iteration)

Repeats each sprint (1–4 weeks), delivering value continuously while adapting to change. Billed monthly by man-hours.

Ukeoi-type

Waterfall
01

Requirements

02

Design (basic & detailed)

03

Implementation

04

Testing

05

Delivery & acceptance

06

Payment

✓

Done

Delivered — the contract is complete

Phases run top-down in sequence; each starts after the previous completes. The contract closes on delivery of the defined deliverable.

04

Quasi-mandate has two sub-types

Clarified by the 2020 Civil Code reform — important when drafting payment terms.

Ri-kō-wariai

Paid by proportion of work

Payment tracks the volume of work / time invested, regardless of the final result. This is the classic “labo-type,” calculated by man-month.

Seika-kansei

Paid on achieving the outcome

Payment is tied to achieving an agreed outcome, yet it carries no “completion duty” like ukeoi. It sits between the proportion type and ukeoi — easily confused, so state it clearly in the contract.

05

Which should you choose?

Choose by how clear the requirements are, and who should bear the risk.

Choose Labo-type (quasi-mandate)

when…
  • ✓Requirements aren’t fixed yet and evolve as you go (agile, R&D)
  • ✓Long-term project where you want a stable team and retained know-how
  • ✓The client also helps set priorities and runs a flexible backlog
  • ✓Work volume is hard to estimate for a fixed price
  • ✓You need to scale the team up or down by phase

Choose Ukeoi-type

when…
  • ✓Scope and spec are clear; a concrete deliverable can be fixed
  • ✓You want the total cost upfront (fixed price); easy budget approval
  • ✓You want to transfer completion risk to the vendor
  • ✓One-off work with clear delivery milestones
  • ✓You don’t need — or want — to manage the daily process

This page is an internal explainer and does not replace formal legal advice; actual terms follow the signed contract.

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