Bali International Finance sued

JAKARTA (JP): Hong Kong-registered Bali International Finance Ltd. was sued at the West Jakarta District Court here for what the plaintiff, Mrs. Gina Widjaja, claimed to be a legally flawed indemnity and guarantee agreement the company entered into with her husband, Bambang Sutrisno.

According to Prastowo, the lawyer who filed the lawsuit for Mrs. Widjaja, under the agreement Sutrisno unlawfully pledged the assets he owned jointly with his wife as security against a syndicated loan for PT Surya Supratama Finance in Jakarta.

Bali International, a unit of Bank Bali in Jakarta, served as the managing agent in the arrangement of the loan syndication.

Sutrisno was formerly a shareholder of Bank Surya which was closed by the finance ministry in early April, 1998, due to insolvency.

However, as the loan, provided by nine domestic and foreign finance companies, turned sour, Bali International and the other creditors sued Sutrisno and Mrs. Widjaja at the high court in Singapore, where Judge S. Rajendra decided late last year to issue an injunction prohibiting the disposal of assets owned by the couple in Singapore.

Mrs. Widjaja demanded that the West Jakarta court annul the indemnity and guarantee agreement between Sutrisno and Bali International because the assets pledged under the agreement were owned jointly by the couple and the agreement was made without the prior approval of Mrs. Widjaja.

She cited a provision in the 1974 Marriage Law which stipulates that the material wealth earned during the course of a legal marriage is jointly owned by the legal couple and its disposal must be based on the approval of both spouses.

The plaintiff also demanded Rp 1.2 billion (US$141,000) in damages from the creditor consortium and Sutrisno to compensate for losses caused by the freezing of the couple's assets and expenses incurred during litigation in Singapore. (vin)