Abuse of circumstances as a reason for the cancellation of financing agreements

Abstract

Article 1 of Presidential Regulation No. 9 of 2009 concerning Financing Institutions states that a financing institution is a business entity engaged in financing activities in the form of provision of funds or capital goods. Business activities of financing institutions give more emphasis on the function of financing in the form of provision of funds or capital goods. The development of financial institutions in Indonesia is increasingly in demand by the community because of the ease of the procedure. In practice many problems arise, among them is the agreement by default, and the case of abuse of circumstances. The abuse, according to this development, is not only limited to the presence of threat/coercion, errors, fraud, but in the field of jurisprudence known as the causes of disability, or the abuse of circumstances. In some cases decided by the Supreme Court of the Republic of Indonesia, the abuse of circumstances has been applied by the judges. It is unfortunate, however, that in some cases the financing agreement that the judge handling the case for the cancellation of the treaty does not apply abuse of circumstances.