THE PAYMENT OF RECEIVABLES OF SEPARATIST CREDITOR AS A MORTGAGE RIGHTS HOLDER UNDER THE BANKRUPTCY AND SUSPENSION OF OBLIGATIONS FOR DEBT PAYMENT ACT

Abstract

The Mortgage Rights is a proprietary security right encumbered onto land rights regulated by the Basic Agrarian Act, intended for specific debt repayment, granting a preferential position to certain creditors over others, without reducing the preference of state receivables under the applicable law, should the debtor default. Under the parate execution (parate executie) or enforceable title (executoriale title), the preferred creditor who is the mortgagee, has the right to sell the respective mortgaged assets through a public auction and the debt repayment would then be derived from the sales proceeds. Article 21 of the Mortgage Rights Act, ensures that if the mortgagor is declared bankrupt, the mortgagee still retains the rights obtained under the act. The enforcement of Act Number 37 of 2004 concerning the Bankruptcy and Suspension of Obligations for Debt Payment, (hereinafter referred to as The Bankruptcy and PKPU Act), has caused numerous legal issues, particularly the antinomy between the Mortgage Rights Act and The Bankruptcy and PKPU Act, such as a 90-day bankruptcy stay phase, the suspension of obligations for debt repayment stay phase of 45 days with a maximum of 270 days, a mere 2 months of a time span on executing the proprietary security right, its respective sale conducted by the curator and payment of the debt of the preferred creditor depends entirely on the distribution list of assets that have been approved by the supervisory judge with a legally binding force. The proceeds from the sale conducted by the curator on the said object encumbered with mortgage rights are paid to creditors according to their ranks, whereby the rank of the mortgagee involved does not come first.

Keywords

• execution
• antinomy
• public service
• regulation
• mortgage rights