Constitutional Justice Enny Nurbaningsih at the ruling pronouncement hearing of case No. 88/PUU-XVIII/2020, Thursday (14/1/2021) in the Plenary Courtroom of the Constitutional Court. Photo by Humas MK/Teguh.
JAKARTA, Public Relations of the Constitutional Court—The judicial review petition of Bankruptcy and Suspension of Debt Payment (Bankruptcy Law) filed by Dewantari Handayani, Amriyati Amin, Martina Nasution, Nugroho Suryaningrat, dan Irma Shandra Santy was dismissed by the Constitutional Court (MK). The Court found no causality (causal verband) between the enactment of the article in the law and the Petitioners’ constitutional impairment based on the 1945 Constitution.
“[The Court] adjudicated, declares the Petitioners’ petition inadmissible,” said Chief Justice Anwar Usman alongside the other eight constitutional justices at the remote hearing of Decision No. 88/PUU-XVIII/2020 on Thursday, January 14, 2021 in the plenary courtroom.
The Petitioners challenged Article 55 paragraph (1) of Law No. 37 of 2004 on Bankruptcy and Suspension of Debt Payment (Bankruptcy Law), which reads, “With due observance to the provisions of Articles 56, 57, and 58, any Creditor holding lien, fiduciary security, security right, mortgage, or other collateral rights on property, may execute their rights as if no bankruptcy occurred.”
They felt disadvantaged by the Central Jakarta Commercial Court ruling that granted PT Prospek Duta Sukses’ (PDS) request for suspension of debt payment as an apartment developer from which they had bought units of Apartemen Antasari 45 from. The apartment was on the market since 2014 and the Petitioners should’ve had ownership of the units in 2017. However, until early 2020, construction of the units wasn’t finished.
Also read: Apartment Buyers Challenge Provision on Bankrupt Developers
In its legal considerations, the Court stated that the petition stemmed from a concrete case the Petitioners were involved in. The Petitioners would like to be likened to preferred creditors or separatist creditors by challenging Article 55 paragraph (1) of the Bankruptcy Law at the Constitutional Court.
The Court opined that the settlement of the issue has already been regulated in a law that has nothing to do with Article 55 paragraph (1) of the Bankruptcy Law, because the article stipulates that secured creditors or separatist creditors have the first right in the debt settlement (preferred creditors) because they legally own the collateral. Conversely, being concurrent creditors, the Petitioners didn’t have the ownership right to the collateral. Therefore, the debt settlement involving concurrent creditors (i.e. the Petitioners) is done after the settlement involving separatist or preferred creditors is completed.
The Court opined that the settlement of the issue has already been regulated in a law that has nothing to do with Article 55 paragraph (1) of the Bankruptcy Law, because the article stipulates that secured creditors or separatist creditors have the first right in the debt settlement (preferred creditors) because they legally own the collateral. Conversely, being concurrent creditors, the Petitioners didn’t have the ownership right to the collateral. Therefore, the debt settlement involving concurrent creditors (i.e. the Petitioners) is done after the settlement involving separatist or preferred creditors is completed.
Moreover, separatist creditors aren’t affected by a court decision that ruled on the debtor’s bankruptcy. This means that their executorial rights are implemented regardless of the debtor’s bankruptcy, because these creditors can sell the collaterals. Therefore, in relation to the assets used as collateral, the separatist creditors’ position is very high, even higher from other preferred creditors.
Also read: Petitioner of Bankruptcy Law Strengthens Background of Petition
The Court stated that the Petitioners were initially not concurrent creditors but customers or buyers of Apartemen Antasari 45 units, whose developer has been declared bankrupt. Therefore, based on the bankruptcy ruling, the Petitioners’ status was equated with that of concurrent creditors, therefore they cannot demand to be declared separatist or preferred creditors by challenging Article 55 paragraph (1) of the Bankruptcy Law with the rationale that they were harmed by the enactment of the article.
The Court believes the Petitioners’ loss as consumers is not related to the enactment of Article 55 paragraph (1) of the Bankruptcy Law, so the solution wasn’t supposed to be judicial review but other legal measures or by positioning themselves as concurrent creditors. Therefore, the Court concluded that there was no causality (causal verband) between the enactment of the article and the Petitioners’ constitutional impairment. In addition, because the Petitioners couldn’t elaborate on the actual or potential loss of their constitutional rights, they lacked legal standing to file the petition, pursuant to Article 51 paragraph (1) of the Constitutional Court Law.
Writer: Utami Argawati
Editor: Nur R.
PR: Raisa Ayudhita
Translator: Yuniar Widiastuti (Editor: Indah Apriyanti)
Translation uploaded on 01/15/2021 15:39 WIB
Disclaimer: The original version of the news is in Indonesian. In case of any differences between the English and the Indonesian version, the Indonesian version will prevail.
Friday, January 15, 2021 | 10:35 WIB 400