Indonesian Supreme Court Decision No. 569 of 2015: Shari'a Economy Cassation

The cassation applicants sought to challenge Decision: 160/ Pdt.G/2014/PTA.Smg. of the Semarang High Religious Court and Decision: 1721/Pdt.G/ 2013/PA.Pbg of the Purbalingga Religious Court, on the grounds that both courts had erred in their application of the law. More specifically, that:

  1. the lower courts had failed to consider that the money obtained pursuant to the multi-service ijarah financing agreement was used for tabloid printing costs, while printing had stopped because the director of printing (Suyitno) had absconded, as stated in a report to Purbalingga Police, dated 21 October 2013;
  2. the cassation applicants had provided a financial guarantee of IDR 25 million, which, while it was subsequently blocked by the cassation respondents, should have been used to reduce their arrears;
  3. evidence was produced showing that the debt owed to the cassation respondents was in the name of Mulia Lastro Wibowo, not the cassation applicants, which should render the decision of the lower courts invalid; and
  4. the Purbalingga Religious Court had noted in its judgment that the cassation respondents had produced witnesses, when in actual fact they had not.

The court allowed the appeal on the following different grounds:

  1. that the Semarang High Religious Court was inconsistent in its findings with regard to the cassation applicants defaulting on repayments due, stating that a default had to be allowed until the agreement concluded in September 2016, while also concurring with the Purbalingga Religious Court that the cassation applicants had defaulted; and
  2. that the Semarang High Religious Court decision lacked legal certainty because the cassation applicants, who were found to have defaulted, should have been ordered to pay damages rather than to simply discharge their arrears with the cassation respondents, because such an order did not remove the risk of the cassation applicants defaulting again.
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