PT Lontar Papyrus tried to blur the facts

Dispute arises between PT Lontar Papyrus Pulp & Paper Industry and the bondholders in the debt transaction in amount of USD 550 million in the District Court of Kuala Tungkal Jambi is assume shall be attractive and extensive, since the defendants have prepared legal arguments to destroy the claim.

First actions performed by the defendants are regarding the authority of the court to examine over such case. If this action failed, the Attorneys have prepared arguments and legal facts to counter by argue there has been a fabrication, legal evasion and unlawful act in the debt agreement with amount of USD 550 million.

"District Court of Kuala Tungkal has no authority to adjudge such claim since the parties has chosen the jurisdiction in the Court of New York,” said Todung Mulya Lubis, Attorney In Fact of one defendant, Morgan Stanley & Co Incorporated.

Claim of PT Lontar Papyrus Pulp & Paper Industry, pursuant to the practitioner above, shall be submitted in the Court of New York and not in the District Court of Kuala Tungkal.

"The parties have agreed that the court of New York is the authorized court to settle the dispute arises in relation to such transaction.” He said.

Several facts submitted by Todung have affirmed that District Court of Kuala Tungkal is without authority to examine over such claim. First, the parties have appointed and chosen that the loan transaction in amount of USD 550 million is pursuant to the law of New York.

Second, the transaction was performed out of Indonesian region. This matter is able to be seen that the notes is issued in the Netherlands, the notes were bought by the underwriter in USA, The notes was never offered to be sell in Indonesia.

All payment over principal and interest in relation to the notes are given to trustee in New York.

Third, all related parties having their center of business out of Indonesia and most of them located in USA, except PT Lontar Papyrus, defendant of Bank Mizuho Indonesia and defendant National Land Agency, Kuala Tungkal.

Legal Practitioner of law firm Lubis, Santosa & Maulana was questioned on why PT Lontar Papyrus should file a claim to the Office of National Land Agency of Kuala Tungkal, in the domicile of one of the defendant?

If the plaintiff did not intend to file the claim to court whose jurisdiction over other defendant domicile, why plaintiff id not file the claim to the court having jurisdiction over domicile of PT Bank Mizuho Indonesia (District Court of Central Jakarta)?

Such unusual has given the doubt to Mulya, PT Lontar Papyrus deliberately has manipulate to submit the claim to District Court of Kuala Tungkal by insert the Land Office of Regency Kuala Tungkal as one of the defendant.

Mulya expect to the District Court of Kuala Tungkal shall consider intensely prior to take incorrect and inaccurate decision, due to the result shall impact on the trust of the foreign investor towards the law enforcement in Indonesia.

Cancellation of Debt

He also remind that at this moment exist a phenomenon to submit claim to cancel the debt trough court. “This matter has been concerned between the international investor” He said.

If District Court of Kuala Tungkal is going to fulfill claim of PT Lontar Papyrus, he said that it shall bring a significant impact towards Indonesian economy.

Such matters he added are able to obstruct access to the government and Indonesian company if they intended to obtain fund from international capital market.

"Creditor and International Investor tend to acted wait and see since they are worried if debtor file a claim before the court and request for cancellation of the agreement.” He added

Pursuant to Mulya, claim of PT Lontar Papyrus has turning the real facts, includes the legal fact.

"Plaintiff has endeavor to obscure the main objective on the claim by attach the petition of cancellation of the deed in relation to security agreement in order to make District Court of Kuala Tungkal has the authority to examine over the matter,” He added.

Argument said by PT Lontar Papyrus stated that the finance transaction in this matter is in contradiction to Indonesian law with the utilization of fabricated transaction, unlawful act and unlawful act is incorrect.

"PT Lontar Papyrus deliberately tend to blur the fact to mislead panel of judges in examine and comprehend the facts in such matter,” He said.

Not the first case

The case with this method was not the first. The same case also happens in the District Court of Serang between PT Tri Polyta Indonesia Tbk versus 92 bondholders.

District Court of Serang in the judgment last weekend had won PT Tri Polyta by cancel all agreement with the creditor regarding the debt in amount of US$185 million, however, such judgment is file an appeal by the defendant.

Rahmat Bastian, Attorney In Fact of defendant, OCM Opportunities Fund II LP, is in the opinion that District of Kuala Tungkal is without competence to adjudge over the case. “Debt agreement was not made in Indonesia but in New York, AS”.

Bastian of BTPartnership law firm said, In the agreement, has been affirmed, in the event of occurrence a misunderstanding towards the contract, shall be settled pursuant to the Law of New York.

He also questioned why the Land office of Kuala Tungkal also inserted as one of the defendant. “Taking Land office of Kuala Tungkal as the defendant is not appropriate pursuant to the principal agreement,” He said.

Pursuant to his opinion, the main reason of plaintiff by submit the claim is to release, cancel or decide without grounds towards all obligation as stipulated in the indenture after PT Lontar Papyrus had breach its contract.