The Legal Consequences of Bankruptcy on Grant Agreement

Abstract

In articles 1311 and 1332 of the Civil Code, especially article 1311, it is stated that all the property owed, whether movable or immovable, whether existing or future-proof, shall be borne for all personal engagements. This means that if a debtor neglects his performance to a creditor based on the provisions of Article 2 of the Law on Bankruptcy and Suspension of Debt Payment Obligations, then the right to auction the debtor's assets will later be given to the creditor. The first step taken by the bankruptcy institution is a mass execution of the debtor's assets, also known as general confiscation, in which the debtor's assets are under the supervision of an authorized official (curator) for distribution. Before a general seizure is made, a debtor usually checks the assets he owns and even gives some or a small amount of his assets to others for free, or what is called a grant. Therefore, in this study, the author analyzes the act of giving grants performed by debtors who have been declared bankrupt in bankruptcy disputes. Therefore, to find out the legal consequences, the author is interested in researching how bankruptcy law affects grant agreements. This type of research is called normative legal research. The research methods were carried out by examining library materials or secondary data. The type of approach used in this study was the normative-juridical approach. This was done by looking for materials from library or secondary data as the sources in writing the research report. The answer to the problem statement, which is the general effect of bankruptcy law on a grant agreement, is that if the grant involves the transfer of assets from the debtor to the grantee, then the bankruptcy law can affect the ownership and the control of those assets. In bankruptcy proceedings, the grantee may lose his or her rights to the assets that have been granted. In addition, the Law on Bankruptcy and Suspension of Debt Payment Obligations provides a mechanism for the curator to withdraw the bankrupt assets under the control of a third party with the Actio Pauliana legal remedy which aims to cancel all the actions of the debtor that are not obligatory, including the provision of grants or transfer of assets before bankruptcy occurs.