Bankruptcy claim on Semen Cibinong denied

Bankruptcy claim on Semen Cibinong denied

JAKARTA (JP): The Jakarta Commercial Court turned down a
bankruptcy claim on Thursday filed by Bank Papan Sejahtera
against PT Semen Cibinong and holding company PT Tirtamas
Majutama due to an invalid letter of attorney.

Presiding judge Sihol Sitompul told the court, "The letter of
attorney issued on March 1 by Bank Papan's president to the
prosecutor's lawyer is not valid."

Bank Papan's management and commissioners, the judge
continued, had lost their rights and authority over the bank on
Sept. 30, 1998, when the government announced that 54 domestic
banks, including Bank Papan, be put under the supervision of the
Indonesian Bank Restructuring Agency (IBRA) due to hefty bad
loans.

According to government regulation No.17/1999 issued on Feb.
27, the management and commissioners of the banks that were
closed by the government, taken over by the IBRA or under
supervision of the IBRA, lost their rights and authority over
their banks.

Defendant lawyer Hotman Paris Hutapea said he was pleased with
the court's decision, reasoning that all legal procedures had to
be fulfilled before the court could proceed with the substance of
the case.

"The fact is that the plaintiff lawyer has failed to maintain
a correct legal procedure in filing a bankruptcy claim," he said.

Bank Papan, one of 38 private banks closed by the government
on March 13, filed a bankruptcy petition against Semen Cibinong
and Tirtamas Majutama with the court before its closure for the
companies' failure to settle loans amounting to US$8.6 million
and Rp 200 billion ($22.7 million), respectively, which became
due between June 30 and Oct. 1 last year.

Bank Papan's lawyer, Lucas, said the bank had two options: to
appeal or file a bankruptcy claim again with a letter of attorney
from IBRA.

IBRA sent a letter to the commercial court on March 25
consenting to Bank Papan's bankruptcy claim against PT Semen
Cibinong and holding company PT Tirtamas Majutama.

But, according to the presiding judge, this could not be
considered as a letter of attorney to the defendant lawyer
because the court hearing had already began.

"It is likely that we will appeal because today's (Thursday)
decision will have a wide impact on many other cases in the
commercial court as well as in the district court," Lucas said.

He said many of the 38 banks closed by the government on March
13 have filed suits against their defaulted borrowers with their
lawyers holding the letter of attorney from the incumbent
management.

Otto Hasibuan, one of the defendant lawyers, admitted that he
had a few cases from several closed banks.

"I am going to consult with IBRA whether my letters of
attorney from my closed bank clients are valid," he said after
the court session. (02)