Questionable verdict

Less than four days after President Abdurrahman Wahid made another pledge to embark on establishing the primacy of the rule of law by replacing corrupt judges with honest ones in Jakarta's five district courts, judges at the South Jakarta District Court snubbed the government by dropping all corruption charges against Djoko Tjandra, a key suspect in last year's high-profile Bank Bali corruption case. Presiding judge R. Sunarto said in a summary judgment on Monday that the lawsuit against Djoko had been filed at the wrong court, arguing it was a commercial case, not a criminal one.

The decision obviously stunned not only the government and most lawyers but also the international community, including the World Bank and the International Monetary Fund, which last September abruptly canceled their loan disbursement to Indonesia due to the scandal.

The controversial court ruling once again highlighted Indonesia's flawed legal system, reinforcing fears that the chances of legal redress in the country remain as uncertain as during more than 30 years of the authoritarian rule of former president Soeharto. While substantial progress has been made in the reform of the executive and legislative branches of the government, the judicial system has been relatively untouched by the reform movement.

Surely the government must also be seen to occasionally lose in court to demonstrate to the public that the ruler is also subject and subservient to the rule of law and because, in practice, the government also can do wrong.

However, the South Jakarta District Court's decision is beyond anyone's legal sense of justice because it was taken even before the judges investigated all the facts of the case. Focusing their judgment on the cessie agreement between Bank Bali and PT Era Giat Prima and seeing the case simply as a debt transaction between two private parties outside government interest imply two worrisome possibilities: The judges could have been bribed or were technically incompetent to judge the case involving a complex financial deal; or the prosecutors at the Attorney General's Office were not able to prepare an airtight case or deliberately put the case together with so many loopholes in return for personal rewards from the defendant.

A special audit by PricewaterhouseCoopers and another special investigation by a House of Representatives team on the Bank Bali scandal last year have concluded that without a doubt the case clearly smacks of corruption and merits a hearing in court. The case is the parody of how politically well-connected businesspeople colluded with senior officials to plunder the government, using a cessie agreement as the vehicle of transaction.

The audit showed how the cessie agreement was actually legally defective from the outset and seemed to have been made in bad faith because Era Giat Prima had not paid anything to acquire the debts owed to Bank Bali. Such an up-front payment is one of the legal conditions of a cessie agreement whereby a party takes over the debts of another party at a discount.

Moreover, as the debtor is the government in the form of the Indonesian Bank Restructuring Agency (IBRA), Bank Bali did not require the service of any other parties to collect its money. If Bank Bali itself was not able to collect the money under the government guarantee scheme for bank deposits and claims it simply meant the loans did not meet the requirements for reimbursement, and no other parties would have been able to make the loans viable for payment least they colluded with IBRA or Bank Indonesia, which was in charge of verifying the validity of such claims.

The flow of funds -- from the Rp 546 billion fee paid by Bank Bali to Era Giat Prima, as uncovered by PricewaterhouseCoopers -- and the testimonies of a large number of senior officials to the House investigative team further strengthened the suspicion that the case was full of elements of malfeasance.

Whatever the real reason behind the verdict and even though IBRA or the Attorney General's Office can still appeal the judgment, one thing is crystal clear. It once again shows how urgent it is for the government to act quickly and speedily to reform the judicial system because legal certainty is essential to rebuilding Indonesia's shattered economy and maintaining the nation's political integrity.