Commercial Court hears first bankruptcy case
JAKARTA (JP): The country's newly established commercial court began hearing the first bankruptcy cases on Monday, pitting PT Karabha Digdaya, a real estate and golf course developer, against construction firms PT Jaya Obayashi and PT Nusa Raya Cipta.
A three-judge panel at Central Jakarta Commercial Court heard the charges against Karabha brought by the two construction firms.
Lawyers for the plaintiffs, Hotman Paris Hutapea and Jamaslin Purba of law firm Makarim and Taira S, read out the charges against PT Karabha to the court panel chaired by Haryono.
They said that Karabha owed a total of Rp 15.3 billion (US$1.33 million) in unpaid construction fees and interest for the development of the Emerald golf course and clubhouse in Cimanggis, Bogor, West Java.
PT Karabha Digdaya is owned by Judith Soeryadjaya, the daughter of William Soeryadjaya, the former owner of the country's largest carmaker PT Astra International.
Defense lawyer Yan Apul of Yan Apul and Partners, acknowledged that his client, PT Karabha, owed the construction fees but said the amount was Rp 4.3 billion less than that claimed.
"My client owes only Rp 11 billion in construction fees to the construction firms," he said, pointing out that his client had total credits worth Rp 400 billion with about 40 creditors.
Karabha has already been sued by publicly listed Lippo Bank and Bank Internasional Indonesia (BII) for its failure to repay loans worth Rp 200 billion to the two financial institutions.
PT Jaya Obayashi and Nusa Raya Cipta filed the case on Sept. 1, the first bankruptcy claim since the implementation of the country's new bankruptcy law on Aug. 20. The two companies are demanding the court declare Karabha bankrupt and allow its assets to be sold off, including Emerald Golf Course and clubhouse, to repay the funds owed.
Monday's hearing was packed with reporters and observed by the assistant general consul of the International Monetary Fund (IMF), Sean Hogan.
The hearing was marked by heated arguments between the lawyers of the disputing firms.
Yan Apul, representing Karabha, submitted a document containing his client's proposal to suspend the payment of the funds owed.
Presiding judge Haryono accepted the document and adjourned the hearing until Thursday to allow the commercial court to verify the documents.
"We postpone the hearing to allow the court to verify the documents and the second hearing will be held on Thursday, Sept. 17," Haryono said.
The commercial court will settle bankruptcy cases under the new law which allows 30 days for settlement and 30 days for appeal.
The Indonesian government revised the old bankruptcy law and set up a commercial court as part of the package of reforms agreed in return for the IMF's US$43 billion bailout to salvage the country's wrecked economy.
The old bankruptcy law, which dates back to 1906 and the Dutch colonial administration, was considered insufficient in the wake of rising business collapses sparked by the country's economic downturn.
Central Jakarta Commercial Court also held another hearing on Monday, pitting PT Lelco Trindo against PT Mustika Princess Hotel but the hearing was canceled as the former revoked its bankruptcy claim.
Lelco Trindo had filed a case against Mustika Princes Hotel, the owner of the Sheraton International Hotel Yogyakarta early this month after the hotel defaulted on the payment of construction fees to Lelco worth Rp 319.9 million.
"We have reached an out-of-court settlement," Denny Kailimang, representing Lelco, said.
The commercial court is to hold another hearing on Tuesday between American Express Bank and cocoa producer PT Davomas Abadi.
State-controlled Bank Negara Indonesia (BNI) and BII filed early this month a bankruptcy claim at Central Jakarta Commercial Court against listed PT Ometraco Multi Arta and Ometraco Corporation.
The hearing is scheduled for Sept. 18 for the former and Sept. 21 for the latter. (aly)