Bantul Religious Court Determination No. 385 of 2016: Damages Claim Withdrawn

The plaintiff submitted that, on 5 February 2011, a cooperative agreement had been executed between the plaintiff and the company CV. Barito Putera Mandiri (the company), represented by the first defendant as its administrator. The agreement financed the purchase of motorcycles and, in principle, regulated the relationship of the plaintiff as creditor of customers seeking to purchase motorcycles, and the company as the retail provider of those motorcycles. For a year, pursuant to a financing request submitted by the company, represented by the first defendant, the plaintiff had already approved the murabahah financing for the purchase of 136 motorcycles for its customers, for a total of IDR 1,738,165,000.

Initially, the financing of these motorcycles had gone smoothly, the company successfully executing its obligation to transfer proof of owernship to every customer. This was not the case for the 15th-136th customers, however, as the company, acting in bad faith, had only provided the customers with photocopies of their proof of ownership. It subsequently became known that the defendants, through the company, had already collected financial instalment repayments from the customers, but had not deposited those instalments with the plaintiff, contrary to art 6(8) of the murabahah agreement. Even after employees of the plaintiff contacted the customers who had obtained financial facilities from the plaintiff through the first defendant, the customers continued to transfer their money to the defendants because they had received proof of ownership of their motorcycles.

On numerous occasions, the plaintiff requested, orally, and in writing on 11 May 2012, that the defendants adhere to the murabahah agreement and fulfil their obligations pursuant to art 6(4) thereof. Since 5 February 2011, the first defendant had only deposited IDR 433,165,000 from a total of IDR 1,738,165,000 with the plaintiff, was therefore in contravention of art 6(4) and (8) of the agreement, and had incurred a loss of IDR 1,305,000,000. In order to rectify the cessation of payments, the plaintiff had sent a letter to the defendants, through the company, which was responded to by the first defendant as director of the company on 29 February 2012. Principally, the first defendant's response stated that the company was responsible for all financial payment instalments from the customers until customers had repaid their debts entirely. When this commitment was not met, the plaintiff sent another letter of confirmation and clarification to the defendants, dated 11 May 2012, which received a response confirming the transfer of all customer financing.

The parties agreed to draft six murabahah agreements for the purchase of motorcycles, valued at IDR 1,305,000,000, operating as a transfer of the financial customer agreements for the purpose of repaying the remainder of the arrears from the 136 motorcycles from the company. Each defendant executed one of the new murabahah agreements. These new agreements were executed assuming that, until May 2012, the motorcycle financing would be reduced by one year from three years, meaning that the 136 motorcycles, in principle, belonged to the plaintiff, making the conversion of the sale agreements from the plaintiff to the defendants lawful. Despite new agreements and reminder notices from the plaintiff, the defendants continued to default on their repayment obligations.

Initially, the plaintiff requested that the Court order the defendants to pay damages for failure to meet their contractual obligations, and to declare lawful the plaintiff's seizure of collateral properties and vehicles leveraged by the defendants. After receiving counsel from the Court, however, the plaintiff chose to withdraw its application. The defendants were absent from court, while the plaintiff was ordered to pay court costs (IDR 701,000).

FirstPreviousPage 1 of of 16NextLast