Jakarta, September 2023. Our firm has successfully defended our client, PT Risland Property Indonesia, part of Country Garden group, as Defendant I in first stage on two similar cases to win on the court’s jurisdiction ground.
The main claim by the Claimant in both cases are a claim of unlawful act related to the liquidation of bank guarantee. There are several Defendants in these claims. The bank guarantee has determined a legal domicile in the District Court of Jakarta Selatan. While the main underlying contract between the Claimant and Defendant I has an arbitration as its choice of forum.
The panel of the judges considers, on its interlocutory decision, that the main underlying contract is a construction contract between the Claimant and Defendant I which has an arbitration as its choice of forum. The judges consider that under the provisions of a contract, disputes on the termination and interpretation of the contract are subject to the resolution to arbitration, not to the court. The judges further rule that even though the bank guarantee stipulates the District Court of Jakarta Selatan as its legal domicile, the bank guarantee is an accessoir agreement to the main underlying contract, namely construction contract. Thus, the judges declare that they do not have jurisdiction to try the claim. Responding to the court’s decision, our Eddy M. Leks says, “We appreciate this decision since there are sometimes different considerations by the judges when a claim involves other parties than the party bound to an agreement, such as under this claim.”
Leks&Co is recommended on commercial dispute resolution by Legal500, asialaw, and Benchmark Litigation.
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