LEGAL STANDING OF PERSONAL GUARANTORS IN BANKRUPTCY PETITIONS UNDER SUPREME COURT DECISION NUMBER 141 PK/PDT.SUS/PAILIT/2016

This article examines the legal standing of a personal guarantor in bankruptcy proceedings under Indonesian insolvency law, focusing on Supreme Court Decision Number 141 PK/Pdt.Sus/Pailit/2016. The case concerned Arifin, the applicant for judicial review and respondent in the underlying bankruptcy petition, and PT Bank Mayapada Internasional, Tbk, the respondent in the judicial review and original petitioning creditor. The central issue is whether a personal guarantor who has waived the privileges under Articles 1831 and 1837 of the Indonesian Civil Code may be declared bankrupt without the principal debtor first being declared bankrupt or insolvent. Employing normative legal research with a case study approach, this article analyses Personal Guarantee (Borgtocht) Deed Number 107 dated 28 September 2012, the procedural history from the Commercial Court proceedings to the Supreme Court rejection of the judicial review, and the Court legal reasoning. The analysis finds that the Supreme Court consistently treats a guarantor who has waived these statutory privileges as assuming the position of the principal debtor for debt collection purposes. Accordingly, such a guarantor may qualify as a debtor satisfying the simple proof requirement under Article 8(4) of Law Number 37 of 2004 on Bankruptcy and Suspension of Debt Payment Obligations. Although this approach strengthens creditor certainty and commercial predictability, it raises continuing doctrinal concerns regarding the proportionality of subjecting a natural-person guarantor to the collective and reputational consequences of bankruptcy based solely on simple proof.