THE DUTIES AND AUTHORITY OF CURATOR THAT IS IMPORTANT TO UNDERSTOOD
"Bankruptcy Law clearly states that Curator is the Orphan’s Chamber or an individual appointed by the court to manage and liquidate the assets of Bankrupt Debtor under the supervision of supervisory judge."
It is important for a company as a Debtor in bankruptcy to understand that a declaration of bankruptcy by the Court decision results in loss of company’s right to control and manage its assets which include in bankruptcy assets. See also: What is the responsibility of the Board of Directors in case of Bankruptcy?
What about the rights and obligation relating to bankruptcy assets of the debtor?
According to Law No. 37 of 2004 on Bankruptcy and Suspension of Debt Payment Obligation (Bankruptcy Law), under Article 26 paragraph (1) stipulated that any legal actions concerning the rights and obligation on bankruptcy assets shall be filed by or against the Curator.
Bankruptcy Law clearly states that Curator is the Orphan’s Chamber or an individual appointed by the court to manage and liquidate the assets of Bankrupt Debtor under the supervision of supervisory judge (Article 1 paragraph (5)). This means that the Orpan’s Chamber of other Curators appointed by the Court will conduct its obligation under the supervision of Supervisory Judge appointed by the Court.
Seeing the importance of Curator role in Bankruptcy of a Company, Bankruptcy Law also regulates authorities, duties and obligations of Curator.
For example, a duty of Curator is mentioned in Article 98 of Bankruptcy Law, that:
"Immediately after appointed, the Curator shall do anything through all necessary and proper means in order to safeguard the bankruptcy assets and to keep all documents, money, jewelries, securities and other commercial papers against a receipt."
Furthermore, Article 99 states:
- The Curator, through the Supervisory Judge, may request to the Court that bankruptcy assets to be sealed for the purpose of safeguarding the bankruptcy assets.
- The sealing as referred to in paragraph (1) shall be executed by the Bailiff of the Court at the place of such assets in the presence of two witnesses, which one of them shall be the representative of the local government.
Based on provisions above, it is clear that one of the curator’s duties is to do anything through all necessary and proper means in order to safeguard the bankruptcy assets and to keep all documents, money, jewelries, securities and other commercial papers. The curator has the authorization to request bankruptcy assets to be sealed to the Supervisory Judge, executed by the Bailiff and with the presence of two witnesses.
In Bankruptcy Law also requires the Curator to continue the business of the Bankrupt Debtor, on the basis of the approval of the Creditors committee. If Creditors committee is not appointed, the approval for the continuation of the business shall be obtained from the Supervisory Judge (Article 104 of Bankruptcy Law)
Furthermore, the other duties of Curator are to prepare an inventory of the bankruptcy assets and will be deposited at the Registrar Office to provide the public with free access to it. This inventory shall begin no later than two days after receiving Court’s decision on appointing it as a Curator. (Article 100 and 103 Bankruptcy Law).
In connection with its duties, curator has the authorities to open mails and telegrams addressed to the Bankrupt Debtor. Moreover, Curator, according to the circumstances, has the authorities to pay out a sum of money which is determined by the Supervisory Judge. Curator may also transfer the bankruptcy assets insofar as this is necessary to cover the cost of bankruptcy, with an approval from supervisory judge. This provisions can be seen in Article 107 of Bankruptcy Law:
"Upon the approval of the supervisory judge, the curator may transfer the bankruptcy assets insofar as this is necessary to cover the costs of the bankruptcy or if its retention would cause loss to the bankruptcy assets, even if a cassation or judicial review are against it.“
Relating to the curator’s duty to keep all bankruptcy assets (money, jewelries, securities, and other commercial papers), unless the supervisory judge stated otherwise. Upon approval by the Supervisory Judge, cash that is not required to manage bankruptcy assets shall be deposited by Curator to the Bank for the benefit of bankruptcy assets.
Article 116 of Bankruptcy Law states:
- The Curator shall:
- Verifty the claims submitted by the Creditors with the records and information from the Bankrupt Debtor; or
- Consult with the Creditors if there are objections to the submitted claims.
Furthermore, Curator is obliged to enter the approved claim in a temporary list of acknowledgement. While the contested claim shall be entered into a separate list withi its reasons of the contest.
The Curator shall keep a copy of those lists in Registrar’s office for 7 (seven) days prior to the claim verification meeting, for public to get free access to see it. (Article 119 of Bankruptcy Law).
Those receivable lists should be notified to all known Creditors, attaching a further notice for the claim verification meeting and mentionin whether the reconciliation proposal has been offered by the Bankrupt Debtor.
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Iskandar D.P., S.H.