1. Introduction

Auction, as one of the instruments of law enforcement in the field of state receivables and banking, plays a strategic role in the execution of collateral. Through the auction mechanism administered by the Kantor Pelayanan Kekayaan Negara dan Lelang (KPKNL), the creditor is provided with a means to obtain repayment of its receivables in a transparent, accountable manner, and in accordance with the provisions of the applicable laws and regulations. In this context, auction functions not only as a tool for the settlement of debt, but also as an instrument that guarantees legal certainty and legal protection for the parties concerned.

In practice, the object of an auction does not always originate from assets owned by the debtor, but may instead consist of assets belonging to a third party pledged as collateral to secure the debtor's debt. This situation commonly arises under various collateral schemes such as Hak Tanggungan (Mortgage), fidusia (fiduciary security), and other forms of collateral, in which the third party lawfully gives its consent to the use of its asset as collateral. However, once the debtor is declared bankrupt, a complex legal issue arises concerning the status of such asset, in particular whether the third party's asset may be regarded as part of the boedel pailit (bankruptcy estate) or remains outside the bankrupt estate.

This issue becomes all the more relevant given that, in the practice of bankruptcy in Indonesia, differences of interpretation and of court decisions persist regarding the status of third-party assets. Not infrequently, assets that are legally owned by a third party are nonetheless included by the curator in the bankruptcy estate, as though they formed part of the debtor's assets. This situation gives rise to legal uncertainty as well as to the risk of loss for third parties who, in good faith, provided collateral.

To provide clarity, the Supreme Court, through Supreme Court Circular Letter Number 2 of 2024 (Surat Edaran Mahkamah Agung/SEMA No. 2 of 2024), has affirmed that, in principle, assets belonging to a third party are not included in the bankruptcy estate, unless proven otherwise. Nevertheless, the existence of that qualifying phrase still leaves room for interpretation that has the potential to give rise to differing applications in practice, particularly in the process of settlement of the bankruptcy estate and the conduct of execution through auction.

In the context of the conduct of an auction, particularly by the Auction Official at the KPKNL, this situation gives rise to a distinct challenge. As a matter of law, ownership of the auction object rests with the third party, which has the potential to give rise to legal disputes such as a third-party objection (derden verzet), a lawsuit challenging the validity of the collateral, or an objection to the execution process. This calls for a high degree of prudence at every stage of the conduct of the auction.

From the perspective of the Auction Official, the conduct of an auction must at all times be based on the prudential principle, legal certainty, and the protection of all interested parties. The Auction Official does not merely act in an administrative capacity, but also bears responsibility for ensuring that all documents, the legal basis for execution, and the auction object satisfy the formal requirements and are free of any potential legal defect.

It is therefore important to comprehensively examine the conduct of an execution auction over collateral belonging to a third party under the applicable regulatory framework. This examination covers an understanding of the applicable legal framework, the identification of legal risks that may arise, and the mitigation measures that need to be taken in order to minimize the potential for disputes in the future. It is thereby hoped that the conduct of auctions may proceed more optimally, provide legal certainty, and support the creation of a more effective and just system of law enforcement.

2. Authority of the Auction Official in Conducting an Execution Auction over a Bankruptcy Estate where the Auction Object is Collateral Belonging to a Third Party

The conduct of an execution auction is, in principle, a follow-on step arising from the creditor's right to obtain repayment of its receivables through the sale of the collateral object. Within Indonesia's auction system, the Auction Official holds authority that is both attributive and administrative in ensuring that the auction process is conducted in accordance with the provisions of the applicable laws and regulations, in particular in respect of the formal legality of the subject and object of the auction.

One of the fundamental principles in the administration of an auction is set out in Article 25 paragraph (1) of Minister of Finance Regulation Number 122 of 2023 concerning Auction Implementing Guidelines (“PMK 122/2023”), which essentially provides that the Head of the KPKNL, the Head of the Balai Lelang, and the Class II Auction Official are, in principle, not permitted to refuse an application for auction submitted to them, so long as all the required documents are complete and satisfy the aspect of formal legality. This principle affirms that the authority of the Auction Official is not to assess the substantive aspect of a right, but is limited to examining the completeness of the administrative requirements and the formal validity of the documents forming the basis for the conduct of the auction.

In the context of an execution auction over a bankruptcy estate involving collateral belonging to a third party, this principle becomes highly significant. This is because the auction object is administratively recorded in the name of the third party, which has the potential to give rise to doubt in the conduct of the execution. Nevertheless, so long as the application for auction has been completed with the required documents and satisfies formal legality, the Auction Official remains under an obligation to conduct the auction.

Further, under the specific provisions on an execution auction over a bankruptcy estate set out in Appendix B, Number I, letter b, point 7 of PMK 122/2023, it is provided that one of the required documents is the original and/or a photocopy of evidence of the transfer of rights, or another document stating that the asset constitutes, or may be sold as, part of the bankrupt estate, in the event the asset is still recorded in the name of a third party. This provision is an important legal basis in practice, as it provides formal legitimacy for the conduct of an auction over an asset that is not administratively recorded in the name of the debtor.

With this provision in place, the Auction Official has a clear basis for nonetheless proceeding with the auction, so long as there exists documentation demonstrating a legal connection between the asset and the debtor's obligation, for example a collateral agreement, a deed granting Hak Tanggungan, a fiduciary security (fidusia) deed, or a relevant court decision. In this regard, the Auction Official does not assess the substantive truth of ownership, but merely ensures that a formal legal basis exists justifying the sale by auction.

Nevertheless, the exercise of such authority is not free of potential legal risk, in particular where a third party subsequently files an objection (derden verzet) or a lawsuit challenging the validity of the collateral or of the execution process. Accordingly, although normatively the Auction Official may not refuse an application that has satisfied the formal requirements, the application of the prudential principle remains of great importance.

In practice, such prudence is exercised through careful examination of documents, ensuring the absence of any inconsistency or formal defect, and ensuring that the legal basis for execution is clear and can be accounted for. In addition, recent legal developments, including the affirmation that third-party assets are, in principle, not included in the bankruptcy estate unless proven otherwise, must also be taken into account in assessing the sufficiency of the documents submitted.

Accordingly, the authority of the Auction Official in conducting the sale of collateral belonging to a third party is, in principle, administrative and formal in nature, with a clear legal basis, in particular under Article 25 paragraph (1) and Appendix B of PMK 122/2023, but nevertheless requires a high degree of prudence. The balance between legal certainty, compliance with the applicable laws and regulations, and the protection of third parties is key to ensuring that the conduct of an auction may proceed optimally, accountably, and justly.

3. Status of Third-Party Collateral Assets in Bankruptcy and Its Implications for the Conduct of Auctions

In the development of bankruptcy law in Indonesia, the starting point that must be affirmed is the principle of separation of assets between the Bankrupt Debtor and a third party. Article 21 of Law Number 37 of 2004 concerning Bankruptcy and Suspension of Debt Payment Obligations (“PKPU”) (the “Bankruptcy and PKPU Law”) essentially provides that bankruptcy encompasses all of the Debtor's assets as at the time the declaration of bankruptcy is pronounced, together with everything acquired during the bankruptcy. With such a construction, what constitutes the object of the general attachment (sita umum) is, in principle, the assets of the Bankrupt Debtor, not the assets of a third party. A third party's asset pledged as collateral for the Debtor's debt therefore does not automatically change status into part of the bankruptcy estate merely because of the existence of a collateral relationship, or because the asset is encumbered with a security right for the benefit of the Debtor's debt.

Within this framework, Letter B point 3 of Supreme Court Circular Letter Number 2 of 2024 affirms that assets belonging to a guarantor/third party may not be included as part of the bankruptcy estate, unless proven otherwise. The phrase “unless proven otherwise” must therefore not be understood as a basis for treating every item of third-party collateral as automatically forming part of the bankrupt estate, but rather as an exception requiring concrete proof that, in substance, the asset in fact constitutes the Debtor's property, or that another legal basis exists which lawfully justifies such treatment.

In practice, such proof may take the form of various types of documents evidencing a transfer of rights or a legal relationship, among others:

a. A Sale and Purchase Deed (Akta Jual Beli/AJB) between the third party and the debtor, showing that ownership has, in substance, been transferred although the name has not yet been changed in the land register;

b. A Conditional Sale and Purchase Agreement (Perjanjian Pengikatan Jual Beli/PPJB), indicating an agreement on the transfer of rights that has not yet been perfected administratively;

c. A Deed of Grant or other deed evidencing a transfer of rights, showing a transfer of ownership from the third party to the debtor;

d. A nominee agreement or a statement of possession, showing that an asset registered in the name of a third party is, in fact, controlled or owned by the debtor;

e. A court decision declaring the status of ownership, or providing legitimacy for the execution of such asset;

f. An excerpt of the Minutes of Auction (Risalah Lelang) stating that the Bankrupt Debtor was the winning bidder for an auction object that remains registered in the name of the previous owner, in the event the Bankrupt Debtor has not yet completed the process of registering the transfer of rights;

g. Collateral documents, such as a deed granting Hak Tanggungan or a fiduciary security deed, that expressly grant the creditor authority to execute the collateral object, even though it is recorded in the name of a third party.

Accordingly, the existence of such documents does not, of itself, transform a third party's asset into part of the bankruptcy estate; it may only serve as a basis for assessing whether sufficient evidence exists that the asset is, in substance, the Debtor's property, has been transferred to the Debtor, or is legally subject to execution because of the existence of a valid security right in rem. This distinction is important so as to avoid conflating the regime of ownership over the bankruptcy estate with the regime of execution over a collateral object.

Under Appendix B, Number I, letter b, point 4 of PMK 122/2023, concerning the specific documentary requirements for an execution auction over a Hak Tanggungan object pursuant to Article 6 of the Hak Tanggungan Law, the requirements consist of: (a) evidence that the debtor is in default (wanprestasi), among others in the form of warning letters; and (b) where the debtor has been declared bankrupt: the bankruptcy decision; and a copy of the decision, order, or written statement of the chairman of the court/the Supervisory Judge concerning the commencement of the state of insolvency.

Furthermore, Article 36 of PMK 122/2023 affirms that every execution auction relating to a declaration of bankruptcy or of Suspension of Debt Payment Obligations must have regard to the provisions of the laws and regulations in the field of bankruptcy and PKPU.

What is set out in Article 36 of PMK 122/2023 is reflected in Article 59 paragraph (1) of the Bankruptcy and PKPU Law, which essentially provides that a separatist creditor retains the right to execute its right as though bankruptcy had not occurred, save that the exercise of such right is subject to further limitation under the law. That limitation is affirmed in Article 59 paragraph (2), which provides that after the lapse of a period of 2 (two) months from the commencement of the state of insolvency, the separatist creditor is obliged to surrender the asset constituting the collateral object to the curator.

Based on this provision, there is a clear correlation that, where the debtor is declared bankrupt, the creditor holding Hak Tanggungan is given only a limited period, no later than 2 (two) months from the commencement of the state of insolvency, within which to execute the collateral object.

If, within that period, the separatist creditor does not exercise its right, or the collateral object is not successfully sold, the asset constituting the collateral object must be surrendered to the curator in accordance with the mechanism under the Bankruptcy and PKPU Law, for the purposes of settlement (pemberesan) of the estate. However, the surrender of possession or of settlement authority does not, of itself, eliminate the distinction between assets belonging to the Debtor and assets belonging to a third party. Where the object surrendered is collateral belonging to a third party, the curator must nonetheless have regard to the basis of ownership, the scope of the security right, and the limitations set out in the Bankruptcy and PKPU Law, so that settlement does not extend to assets that cannot, as a matter of law, be accounted for within the bankruptcy process.

Further, where the curator includes a third party's collateral object in the list of the bankruptcy estate, or draws it in for the purposes of settlement, the resulting legal dispute is not properly characterized, as a matter of course, as an actio pauliana. An actio pauliana is, in essence, a remedy to set aside a legal act of the Debtor that is prejudicial to creditors. By contrast, where the substance of the matter is an objection to the drawing-in or inclusion of a third party's asset into the bankruptcy estate, the more relevant remedy is a miscellaneous claim/third-party objection against an attachment, or other proceedings relating to the bankruptcy estate, as referred to in the Elucidation of Article 3 paragraph (1) of the Bankruptcy and PKPU Law. Through that mechanism, the interested party may seek the court's confirmation as to the status of the asset, the limits of the curator's authority, and the validity of the act of settlement in respect of the object concerned.

In addition, Article 56 of the Bankruptcy and PKPU Law must also be taken into account, as this provision essentially governs the stay of the exercise of the execution right of a separatist creditor and of a third party whose right is under the control of the Bankrupt Debtor, for a period of no more than 90 (ninety) days from the date the declaration of bankruptcy is pronounced. This stay period is intended to preserve order in the bankruptcy process at its initial stage, but may not be construed as a basis for transferring ownership of a third party's asset into the bankruptcy estate. In other words, Article 56 relates to the stay of the exercise of the execution right or of the taking of action against an asset connected with the bankruptcy process, rather than being a provision affirming the transfer of a third party's ownership right to the Bankrupt Debtor or to the bankruptcy estate.

Accordingly, during the stay period, both the separatist creditor and any other party must comply with the restrictions imposed by law. However, once the stay period has ended, any further act in respect of the collateral object, in particular where that object belongs to a third party, must still be based on a clear legal status of the asset. For that reason, where the curator intends to include or settle a third party's asset, there must be additional prudence, as well as a legal basis capable of being tested, so that no impression arises that the stay of execution under Article 56 is equivalent to the inclusion of a third party's asset into the bankruptcy estate.

An alternative avenue for execution arises where the curator issues an express statement declaring that the collateral object belonging to the third party does not form part of the bankruptcy estate. In practice, this may give rise to a situation in which the creditor is unable to carry out execution because the object is regarded as part of the bankruptcy estate, while, on the other hand, the curator also faces limitations in carrying out settlement over an object that, as a matter of law, belongs to a third party.

This legal construction shows that, although a third party's collateral object may have a legal connection with the Debtor's debt and, in certain circumstances, may become the object of execution or settlement under the Law, this does not mean that the third party's asset is automatically transformed into part of the bankruptcy estate. Every act of the curator in respect of such an asset must remain placed within the framework of the principle of separation of assets, the protection of the third party's ownership right, the provisions on the stay of execution, and judicial review by the court where a dispute arises concerning the status of the asset in question.

4. Legal Protection for a Third Party in Bankruptcy in Respect of an Object Made the Object of an Auction

Legal protection for a third party in bankruptcy is a consequence of the fundamental principle of bankruptcy law affirming that bankruptcy encompasses only the assets of the debtor. This is expressly reflected in Article 1 in conjunction with Article 21 of the Bankruptcy and PKPU Law, which provides that bankruptcy constitutes a general attachment (sita umum) over all of the assets of the bankrupt debtor. Accordingly, as a matter of principle, assets belonging to a third party are not included in the bankruptcy estate and should not become the object of settlement or of auction.

Nevertheless, in practice it frequently occurs that a third party's asset pledged as collateral for the debtor's debt is also drawn into the bankruptcy process, whether because of the existence of a security right in rem or because of the exercise of the curator's authority in settling the bankruptcy estate under the Bankruptcy and PKPU Law. This situation then calls for an effective mechanism of legal protection for the third party.

As set out above, such protection may be pursued through various legal remedies falling within the category of “miscellaneous claims” referred to in Article 3 paragraph (1) of the Bankruptcy and PKPU Law together with its Elucidation. In the context of a dispute over the drawing-in or inclusion of a third party's asset into the bankruptcy estate, the more relevant mechanism is a third party's objection (derden verzet) against an attachment, or other proceedings relating to the bankruptcy estate. An actio pauliana, by contrast, retains its own distinct place, namely to set aside a legal act of the Debtor that is prejudicial to creditors, and is therefore not properly used as a general remedy for every dispute concerning a third party's asset drawn in by the curator.

Where the curator includes assets claimed to belong to a third party within the bankruptcy estate, the role of the Supervisory Judge becomes important, because under the Bankruptcy and PKPU Law the management and settlement of the bankruptcy estate is carried out by the curator under the supervision of the Supervisory Judge. In that capacity, the Supervisory Judge functions to ensure that the curator's acts remain within the bounds of its authority, to call for explanations or reports where an objection is raised as to the status of an asset, and to exercise oversight so that settlement does not extend to assets that plainly fall outside the scope of Article 21 of the Bankruptcy and PKPU Law. Although the final determination of an ownership dispute remains within the province of the court through the available litigation mechanisms, the existence of the Supervisory Judge is highly important as a judicial control within the bankruptcy process, so as to prevent the commingling of the Debtor's assets with the assets of a third party.

In practical terms, where a third party raises an objection to an act of the curator, the Supervisory Judge is also relevant as the party who receives reports on the progress of the management and settlement, and as the supervisory authority whose views the court needs to take into account on issues relating to the bankruptcy estate. For that reason, before a third party's asset proceeds to the stage of settlement or auction, the curator's prudence and the attention of the Supervisory Judge become important instruments to prevent broader disputes and to preserve legal certainty for all interested parties.

In the context of the conduct of an auction, the existence of such claims has a direct implication for the authority of the Auction Official. Although, in principle, the Auction Official is obliged to carry out an application for auction so long as it satisfies the formal requirements under Article 25 paragraph (1) of PMK 122/2023, there is an important limitation that must be observed where there is a dispute concerning the auction object.

This is expressly provided in Article 47 letter c of PMK 122/2023, which essentially states that the Auction Official may cancel an auction that is to be conducted where there is a lawsuit against the planned conduct of an execution auction over a Hak Tanggungan object, filed by a party other than the debtor/the party against whom execution is sought, or the debtor's spouse, relating to ownership of the auction object. This provision shows that the law provides preventive protection for a third party by suspending or cancelling the conduct of an auction where there is an unresolved ownership dispute.

Accordingly, where there is a miscellaneous claim such as an actio pauliana or a derden verzet filed by a third party, the Auction Official may not simply proceed with the auction process. The conduct of an auction must, in principle, await a court decision that has attained final and binding legal force (inkracht van gewijsde), in order to ensure legal certainty as to the status of the auction object. This relationship demonstrates a balance between two principal principles, namely:

a. the principle of certainty in the conduct of an auction, under which the Auction Official may not refuse an application so long as the formal requirements are satisfied; and

b. the principle of legal protection for a third party, under which the conduct of an auction must be suspended or cancelled where there is an ownership dispute still under examination before the court.

For the Auction Official, this situation calls for the application of the prudential principle. The Auction Official must not only examine the completeness of the documents, but must also ensure that the auction object is not the subject of a legal dispute capable of affecting the validity of the conduct of the auction.

Accordingly, the relationship between the provisions on “miscellaneous” claims in bankruptcy law and the provisions on the cancellation of an auction under PMK 122/2023 demonstrates an integration between the litigation and administrative aspects of the conduct of an auction. Protection for a third party is provided not only through the mechanism of a lawsuit before the court, but also through the authority of the Auction Official to suspend or cancel the conduct of an auction pending legal certainty.

The entirety of this mechanism is ultimately intended to ensure that the conduct of an auction not only satisfies procedural aspects, but also guarantees fairness and legal protection for all interested parties in particular a third party as the lawful owner of the object in dispute.

5. Relevant Jurisprudence of the Supreme Court of the Republic of Indonesia

1) Decision: 689 K/Pdt.Sus/2012

Parties:

a. Plaintiff: The Curator of PT. Elang Perkasa Lestari Jaya (In Bankruptcy)

b. Defendant: PT. Bank Mandiri (Persero) Tbk.

Judicial Consideration: That the argument of the Petitioner for Cassation, PT. Bank Mandiri (Persero) Tbk., that the collateral item registered in the name of a private individual/third party is not included in the bankruptcy estate merely because it is registered in the name of a third party, cannot be accepted, because at the time the credit agreement was executed the owner of the collateral item had agreed with the Defendant, PT. Bank Mandiri (Persero) Tbk., to pledge the item as collateral for the debt of PT. EPLJ, in respect of the credit facility granted by the Defendant to PT. EPLJ (in bankruptcy).

Decision:

In the Substance of the Case:

a. Grants the Plaintiff's claim in its entirety;

b. Declares that the said asset constitutes part of the bankruptcy estate of PT. Elang Perkasa Lestari Jaya (In Bankruptcy);

c. Orders the Defendant to surrender the assets of PT. Elang Perkasa Lestari Jaya (In Bankruptcy) to the Plaintiff, in its capacity as Curator of PT. Elang Perkasa Lestari Jaya (In Bankruptcy), immediately upon the pronouncement of this decision, notwithstanding any other legal remedy the Defendant may pursue; and charges the costs of the case to the bankruptcy estate.

2) Decision: 724 K/Pdt.Sus-Pailit/2020

Parties:

a. Plaintiff: The Team of Curators of PT. Multi Graha Pratama (In Bankruptcy)

b. Defendant: PT. Bank Permata, Tbk.

c. Co-Defendant I: KPKNL Jakarta V

d. Co-Defendant II: KPKNL Malang

e. Co-Defendant III: KPKNL Denpasar

f. Co-Defendant IV: KPKNL Bogor

Judicial Consideration: That pursuant to Article 59 paragraph (2) of Law Number 37 of 2004 concerning Bankruptcy and Suspension of Debt Payment Obligations, once the 2 (two) month period stipulated by law has lapsed, the Separatist Creditor is, as a matter of law, obliged to surrender to the Plaintiff, in its capacity as Curator, all items pledged as collateral, whether belonging to the Debtor or collateral items belonging to a third party pledged for the benefit of the debtor. Further, the Defendant's argument objecting to the surrender of the collateral item to the Plaintiff, on the ground that it is not included in the bankruptcy estate because it is registered in the name of a third party/private individual, cannot be accepted, given that at the time the credit agreement was executed the owner of the collateral item had agreed and consented with the Defendant (PT. Bank Permata, Tbk.) to pledge the item as collateral for the debt of PT. Multi Graha Pratama (In Bankruptcy) in respect of the credit facility granted by PT. Bank Permata, Tbk.

Decision:

a. In the Provisional Application: Rejects the provisional application filed by the Plaintiff;

b. In the Objections: Rejects the objections of the Defendant and of Co-Defendant I and Co-Defendant II;

c. In the Substance of the Case:

1. Grants the Plaintiff's claim in part;

2. Cancels, or at least suspends, the conduct of the auctions requested by the Defendant in respect of:

- for Co-Defendant I, the auction on 23 October 2019 over land together with the building thereon, situated at and locally known as Jalan Janur Elok VI, Blok QE 12, Kav. No. 7, Kelapa Gading Sub-district, Kelapa Gading Barat Village, North Jakarta, covering an area of 187 m², as evidenced by Certificate of Right of Ownership (Sertifikat Hak Milik) No. 570/Kelapa Gading Barat dated 29 December 1994;

- for Co-Defendant II, the auction on 24 October 2019 over land together with the building thereon, situated at and locally known as Perumahan Villa Puncak Tidar, Jalan Villa Puncak Kawi, Blok Q 15, Karangwidoro Village, Dau Sub-district, Malang Regency, East Java, covering an area of 339 m², as evidenced by Certificate of Right of Ownership No. 1333/Karangwidoro dated 4 May 2005;

- for Co-Defendant III, the auction on 30 October 2019 over:

a) land together with the building thereon, situated at and locally known as Belalang Village, Kediri Sub-district, Tabanan Regency, Bali Province, covering an area of 660 m², as evidenced by Certificate of Right of Ownership No. 1140/Belalang dated 9 January 2013;

b) land together with the building thereon, situated at and locally known as Jalan Pantai Kedungu, Belalang Village, Kediri Sub-district, Tabanan Regency, Bali Province, covering an area of 660 m², as evidenced by Certificate of Right of Ownership No. 1138/Belalang dated 9 January 2013;

c) land together with the building thereon, situated at and locally known as Jalan Sunset Road, Perum Bale Mansion, Pemogan Village, South Denpasar Sub-district, Denpasar City, Bali Province, covering an area of 696 m², as evidenced by Certificate of Right of Ownership No. 10908/Pemogan-Denpasar dated 11 November 2015;

- for Co-Defendant IV, the auction on 12 November 2019 over land together with the building thereon, situated at and locally known as Perum Legenda Wisata, Cluster Piccaso, Blok K 10, No. 33, Wanaherang Village, Gunung Putri Sub-district, Bogor Regency, West Java Province, covering an area of 160 m², as evidenced by Certificate of Right of Ownership No. 2404/Wanaherang dated 24 January 2005;

3. Orders Co-Defendant I, Co-Defendant II, Co-Defendant III, and Co-Defendant IV to comply with and abide by this decision;

4. Orders the Defendant to surrender the bankruptcy estate to the Plaintiff for the auction sale to be carried out;

5. Orders the Defendant to pay the costs arising in this case in the amount of Rp3,551,000.00 (three million five hundred fifty-one thousand Rupiah);

6. Rejects the remainder of the Plaintiff's claim.

3) Decision: 258 K/Pdt.Sus-Pailit/2024

Parties:

a. Plaintiff: Mrs. Tjong Naik Tjandra

b. Defendant I: The Curator of Tan Charolus Tanjung (In Bankruptcy) and Alexander Sanjoto

c. Defendant II: KPKNL Surabaya

Judicial Consideration: That, in accordance with the facts established at trial, the disputed object belongs to Tan Charolus Tanjung (in bankruptcy) pursuant to Deed of Release of Rights No. 28 and No. 29, executed before Notary Devi Chrisnawati, S.H., and that the disputed object was thereafter encumbered with Hak Tanggungan to secure repayment of the debtor's (in bankruptcy) debt to PT Bank Bukopin Tbk.; accordingly, it is lawful and in accordance with the law that the object of the claim is included in the bankruptcy estate, and the Defendant's conduct in this case is therefore lawful.

Decision:

In the Objections:

- Rejects the Defendant's objections;

- Declares that the Commercial Court within the Surabaya District Court has jurisdiction to examine and adjudicate the case;

In the Substance of the Case:

- Rejects the Plaintiff's claim in its entirety;

- Orders the Plaintiff to pay the costs of the case in the amount of Rp3,179,000.00 (three million one hundred seventy-nine thousand Rupiah).

4) Decision: 39 K/Pdt.Sus-Pailit/2024

Parties:

a. Plaintiff: Herman Budianto

b. Defendant I: The Team of Curators of PT Kijang Perdana (In Bankruptcy)

c. Defendant II: PT Bank Negara Indonesia (Persero), Tbk., c.q. PT Bank Negara Indonesia (Persero), Tbk., Regional Remedial & Recovery Makassar

d. Co-Defendant I: KPKNL Makassar

e. Co-Defendant II: The Ministry of Agrarian Affairs and Spatial Planning/National Land Agency, Makassar City Land Office

Judicial Consideration:

a. That an object belonging to a third party pledged as collateral for the repayment of the Debtor's debt, where the Debtor is declared bankrupt, likewise forms part of the bankruptcy estate of the Bankrupt Debtor;

b. That, on the basis of valid and cogent evidence, it is proven that the Plaintiff is the guarantor of the entirety of the debt of PT Kijang Perdana (in bankruptcy) owed to Defendant II, having pledged certificates of land rights as referred to in the Credit Agreement between Defendant II and PT Kijang Perdana (In Bankruptcy); accordingly, the consideration of the Judex Facti declaring Disputed Objects 1 through 25 to constitute part of the Bankruptcy Estate of PT Kijang Perdana (In Bankruptcy) is correct and proper.

Decision:

In the Objections:

Rejects the objections of Defendant II, Co-Defendant I, and Co-Defendant II in their entirety;

In the Substance of the Case:

a. Rejects the Plaintiff's claim in its entirety;

b. Orders the Plaintiff to pay the costs of the case in the amount of Rp306,000.00 (three hundred six thousand Rupiah).

5) Decision: 769 K/Pdt.Sus-Pailit/2016

Parties:

a. Plaintiff: PT Bank OCBC NISP, Tbk.

b. Defendant: The Curator of PT Mega Graha Internasional (In Bankruptcy)

Judicial Consideration: That the grounds for cassation cannot be accepted; the disputed land under Certificate of Right to Build (Sertifikat Hak Guna Bangunan) No. 3505/Meruya Utara constitutes an asset of PT. Mega Graha International pledged as collateral for repayment of its debt to the Plaintiff, and, in accordance with the applicable provisions, the Plaintiff, as a separatist creditor, was given the opportunity to sell the asset itself within a period of 2 (two) months, which opportunity was, however, not exercised by the Plaintiff.

Decision:

a. Rejects the Plaintiff's claim in its entirety;

b. Orders the Defendant to pay the costs of the case in the amount of Rp316,000.00 (three hundred sixteen thousand Rupiah).

6. Conclusion

a. The Auction Official may not, in principle, refuse an application for auction so long as all formal requirements have been satisfied and are supported by a valid legal basis, as provided under PMK 122/2023. This authority affirms that the role of the Auction Official is administrative and formal in nature, focused on examining the completeness and validity of documents rather than on assessing the substantive aspect of a right.

b. For an execution auction over a bankruptcy estate, where the object to be sold relates to collateral belonging to a third party, the Auction Official is obliged to conduct a careful examination of the ownership documents, the collateral documents, the basis of authority for execution, and the existence of any relevant order or decision. The underlying principle is that, pursuant to Article 21 of the Bankruptcy and PKPU Law, bankruptcy encompasses only the assets of the Bankrupt Debtor, such that a third party's asset does not automatically become part of the bankruptcy estate. Accordingly, an auction over a third party's asset may be conducted only where there exists a clear and accountable legal basis — whether because it is proven that the asset is, in substance, the Debtor's property, or because valid authority exists to execute the collateral object. Where an objection is raised to the inclusion of a third party's asset in the bankruptcy estate, the more appropriate remedy is a miscellaneous claim or third-party objection relating to the bankruptcy estate, with due regard to the supervision of the Supervisory Judge and the provisions of Article 56 of the Bankruptcy and PKPU Law on the stay of execution.

c. Where there is a claim or dispute filed by a third party relating to ownership of the auction object, the Auction Official is obliged to apply the prudential principle by suspending the conduct of the auction, in accordance with the provisions of PMK 122/2023.

Contributor: Rezi Akmal | Legal Associate