Bali International Finance sued

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)