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Virtual panel examination hearing of the judicial review of the Fiduciary Law, Wednesday (30/9) in the Plenary Courtroom of the Constitutional Court. Photo by Humas MK/Gani.

JAKARTA, Public Relations of the Constitutional Court—The Constitutional Court (MK) held a judicial review petition of Law No. 42 of 1999 on Fiduciary Security virtually on Wednesday, September 30, 2020 in the Plenary Courtroom. The case No. 79/PUU-XVII/2020 was filed by Joshua Michael Djami, a certified internal debt collector at a financing company. He challenges Article 15 paragraph (2) and the Elucidation to Article 15 paragraph (2) of the Fiduciary Law against Article 1 paragraph (3), Article 27 paragraph (2), Article 28D paragraph (1), and Article 28J paragraph (2) of the 1945 Constitution.

Article 15 paragraph (2) of the Fiduciary Law reads, “The Fiduciary Security Certificate as referred to in paragraph (1) has the same executorial power as that of a final and binding court decision.”

The Elucidation to Article 15 paragraph (2) of the Fiduciary Law reads, “In this provision, the term ‘executorial power’ means that it can be implemented directly without going through any court and it is final and binding to the parties in executing such decision.”

At the hearing led by Constitutional Justice Enny Nurbaningsih, the Petitioner’s attorney Almas Rioga Pratama said that the provision on the executorial power of the fiduciary security in Article 15 paragraph (2) of the Fiduciary Law has led to the absence of fair legal protection as guaranteed by Article 28D paragraph (1) of the 1945 Constitution due to unequal treatment between creditors and debtors in that creditors have to take the case to court while debtors are not required to do so.

He said the provision is against the principles of a legal state because it has a loophole allowing debtors to make delays of payment, which could lead to them committing the crime of carrying away their property. The enactment of the provision has also destroyed the collecting and financing profession, which the Constitutional Court has acknowledged to be legal according to Decision No. 19/PUU-XVIII/2020. This has led to loss of income and decent living for the Petitioner.

The Petitioner also argued that debtors received preferential treatment as in contracts specify that debtors can deny having defaulted on their debt, which requires creditors to prove this in court. As a consequence, creditors who have good faith and follow existing procedures could lose fair legal protection. He also argued that the interpretation of “voluntarily during execution” violates the principles of a legal state that must uphold provisions that prevent potential crime. If debtors have good faith, they are supposed to request restructuring instead of refusing to hand over their property.

Based on the arguments, the Petitioner requested that the Court declare the article not legally binding insofar as not interpreted as “the Fiduciary Security Certificate as referred to in paragraph (1) has the same executorial power as that of a final and binding court decision,” and declare the phrase “object to transfer voluntarily the object of fiduciary security” not interpreted as “voluntarily when signing the fiduciary agreement.”

Constitutional Justice Enny Nurbaningsih advised the Petitioner to affirm his legal impairment in relation to the right bestowed on him by the 1945 Constitution. Constitutional Justice Manahan M. P. Sitompul advised him to clarify the norms being challenged while Constitutional Justice Arief Hidayat requested him to strengthen his legal standing. “It will be strengthened if a financing company joins in the petition, but said company must show that there has been an extraordinary condition that compels the Court. It is [to be explained] in the posita,” he said.

Before concluding the hearing, Constitutional Justice Enny Nurbaningsih reminded the Petitioner to revise the petition in 14 workdays and to submit a revised petition by Tuesday, October 13, 2020 at 12:30 WIB. 

Writer: Utami Argawati
Editor: Nur R.
PR: Andhini S. F.
Translator: Yuniar Widiastuti (NL)

Translation uploaded on 10/02/2020 15:08 WIB

Disclaimer: The original version of the news is in Indonesian. In case of any differences between the English and the Indonesian versions, the Indonesian version will prevail.

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