SEOUL, South Korea — Prosecutors in South Korea confronted a retired Supreme Court chief justice on Friday with accusations that he conspired to delay a case that could upset relations with Japan, interrogating him in a closed-door hearing that is likely to lead to an unprecedented indictment.
No former or sitting chief justice in South Korea had ever been summoned as a criminal suspect until Yang Sung-tae, 71, presented himself to address allegations that he had manipulated the case on behalf of the nation’s disgraced former president.
The scandal involving Mr. Yang has drawn intense interest in South Korea, where a mistrust of the judiciary is a longstanding phenomenon. The depth of anti-judiciary sentiment is such that when a quixotic pig farmer angry over a court ruling threw a firebomb at the car of the current chief justice, Kim Myeong-soo, the November incident received outsize news and social media coverage.
Mr. Yang’s scandal is also being closely watched by diplomats because of its connection to the growing diplomatic schism between South Korea and Japan, both key American allies.
Bilateral ties have chilled since the Supreme Court ruled in October and again in November that South Korean victims of forced labor had the right to seek damages from their wartime employees, including such Japanese industrial giants as Nippon Steel & Sumitomo Metal and Mitsubishi Heavy Industries.
Tokyo has been livid over those rulings. It insists that all claims arising from its colonial rule of Korea from 1910 to 1945 were settled in 1965 when it paid a lump sum of $300 million in economic aid as it established diplomatic ties with South Korea.
The Supreme Court first sided with the laborers in 2012, when it ordered lower courts to reconsider their earlier rulings in favor of Nippon Steel and Mitsubishi. But it did not finalize its opinion until last October, when it delivered a landmark ruling ordering Nippon Steel to pay $89,000 to each of four South Korean victims of forced labor.
South Korean plaintiffs have long accused Mr. Yang’s Supreme Court of dragging its feet in the case so as to not give Park Geun-hye, then the president, a diplomatic headache with Japan by ruling against the Japanese companies. In her last years in office before she was impeached, Ms. Park sought warmer ties with Tokyo, striking a deeply unpopular deal on comfort women, or Korean sex slaves for the Imperial Japanese Army.
Ms. Park was ousted on corruption charges in March 2017 and Mr. Yang completed his six-year tenure six months later.
After President Moon Jae-in replaced Ms. Park, prosecutors began investigating whether Mr. Yang’s Supreme Court and Ms. Park’s government conspired to reverse the court’s 2012 opinion or delay its final verdict.
“I am deeply sorry to the public for causing concern,” Mr. Yang said in a news conference he held in front of the Supreme Court on Friday.
But he denied the allegations against him and called for his fate to be decided “without bias or prejudice.”
As he spoke, demonstrators shouted for his arrest, calling his court a “private law firm” for Ms. Park.
In South Korea, although the Constitution calls for the separation of executive, legislative and judiciary branches of government, so much power is concentrated in the presidency that political scientists often describe the president as “imperial.”
At the same time, South Koreans have long been frustrated with the judiciary, especially over judges’ repeated soft-glove treatment of top executives convicted of white-color crimes in chaebol, or family-run business conglomerates like Samsung that dominate their country’s economy.
Over the years, many chaebol executives been paraded into courts on bribery and other charges. But they have usually walked away with light sentences (most of them suspended), free to manage their businesses. That led to a common South Korean saying: “With money, not guilty. With no money, guilty.”
Prosecutors are investigating whether Mr. Yang’s Supreme Court used trials as political leverage to win favors from Ms. Park’s government, such as support for creating a new appeals court and posting more judges to South Korea’s overseas diplomatic missions.
Mr. Yang is accused of meeting with lawyers from South Korea’s biggest law firm, Kim & Chang, which represented Nippon Steel and Mitsubishi, and warning other Supreme Court justices of the potential diplomatic fallout of a verdict against Japanese firms.
In October, prosecutors arrested a former senior official of the National Court Administration, an arm of the Supreme Court, and named Mr. Yang as a co-conspirator. The powerful office plays a key role in deciding judges’ job postings and promotions, and Mr. Yang is also accused of using it to influence lower-court rulings and discriminate against judges deemed unfriendly to his leadership and Ms. Park’s government.
Since last summer, prosecutors have raided the National Court Administration and questioned two former Supreme Court justices.
They planned to summon Mr. Yang a couple more times before deciding to formally indict him on charges of abuse of power.
The monthslong investigation has left the judiciary deeply divided. Reform-minded judges had called for an investigation even before Ms. Park was ousted, while others derided the investigation as politically motivated.
The unprecedented scrutiny of South Korea’s deeply cloistered judiciary came as the diplomatic spat between Seoul and Tokyo showed no signs of letting up.
On Thursday, President Moon accused Japan of “politicizing” the South Korean court rulings, a sentiment echoed by his prime minister.
“There are people in South Korea who think Japanese leaders are instigating and abusing anti-South Korean sentiments among their people for political purposes,” said the prime minister, Lee Nak-yon.
On Friday, Japan’s top government spokesman, Yoshihide Suga, called Mr. Moon’s remark “extremely regrettable.”