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The Supreme Court’s decision on the Application for a Judicial Review of the Regulation of the Minister of PUPR No. 23/PRT/M/2018

By April 25, 2022 No Comments

Association of Owners and Tenants of Condominium Unit (PPPSRS) is a legal entity consisting of owners or tenants of condominium unit. PPPSRS is regulated under the Condominium Law No. 20 of 2011 (“Condominium Law”). The establishment of PPPSRS is an obligation by the owner of the condominium unit, which is facilitated by developer, and is regulated under the Condominium Law. PPPSRS has the function and obligation to take care the interests of the owners and tenants of the condominium related to the management of joint equipment, joint facility, joint land, and its tenants.

On 23 May 2019, the Supreme Court (MA) issued a ruling (Decision No. 28 P/HUM/2019) over the judicial review of some provisions on the Ministry of PUPR Regulation No. 23/PRT/M/2018 on the PPPSRS (“PUPR Reg 23”), namely on Article 15 paragraph (3) and paragraph (6), Article 19 paragraph (3), Article 24, Article 28, and Attachment II to PUPR Reg 23. MA rejected the application for the judicial review in its entirety and declared: “to reject the application of judicial review from the applicants”.

The contents of Article 15 paragraph (3) and paragraph (6), Article 19 paragraph (3), Article 24, Article 28, and Attachment II PUPR Reg 23 are as follows:

(A). Article 15 paragraph (3) stipulates “Individuals who become representatives of the Owner as referred to in paragraph (2) including: (i) wife or husband; (ii) Male or female biological parents; (iii) siblings; (iv) an adult child of the Owner; or (v) one of the members of the managing legal entity listed in the deed of establishment if the Owner is a legal entity”;

(B). Article 15 paragraph (6) stipulates, “in the event where the Owner’s representative of the legal entity could not present, he can give a written power of attorney towards the employee”;

(C). Article 19 paragraph (3) stipulates “The owner or the owner’s representative, only has 1 (one) vote even though he has more than 1 (one) condominium unit”;

(D). Article 24 paragraph (1) stipulates: “The elected Head of the Management has a duty, as follow: (i) completes the PPPSRS management structure no later than 2 (two) months after being elected as head of the management; (ii) organizes the inauguration of the managing directors; (iii) determines the annual work plan, based on the management work program; and (iv) forms a deliberation committee no later than 3 (three) months before the end of the PPPSRS management period”;

(E). Article 28 paragraph (2) stipulates: “the recording of the deed of establishment, articles of association, and by-laws as referred in paragraph (1) is carried out by the head of PPPSRS or other management that listed in the deed of establishment no later than 14 (fourteen) working days after the deliberation”; and 

(F). The attachment II of the Articles of Association Part VIII number 2 letter I which reads “not in the status as a member of the management or supervisory board in another condominium”.

The followings are the applicant’s argument and the considerations of the MA:

  • Applicants’ general argument towards the PUPR Reg 23
    The applicant for judicial review argues that all those articles mentioned above violate the Indonesia Civil Code, Condominium Law and Law Number 12 of 2011 on Formation of Laws and Regulations (“Laws Formation Law”). In essence, the applicants argue that the Ministry of PUPR (Ministry) does not have the authority to regulate PPPSRS, and PPPSRS should be further regulated in a Government Regulation, based on the provisions of Article 78 the Condominium Law which stipulates: “Further provisions regarding PPPSRS as referred to in Article 74, Article 75, Article 76, and Article 77 are regulated by the Government Regulation”.

    Supreme Court’s consideration
    MA considers, in the event that the President has not issued a Government Regulation, in an effort to fill the legal vacuum by referring to Article 5 paragraph (1) and paragraph (2) letter a and Article 6 paragraph (1) the Condominium Law, it is stated that “The State is responsible for the administration of condominium where the government acts as a guide”, at the national level it is carried out by the Ministries who according to this Law is the Ministry who carries out government affairs in the housing and settlement areas. “The guidance includes planning, regulating, control and supervision.” Thus, it is appropriate that the government, in this case the Ministry, has the authority by attribution to regulate and administer government affairs in the housing and settlement areas in this case has issued PUPR Reg 23.

  • Applicants’ argument towards the Article 15 paragraph (3) PUPR Reg 23.
    The applicants of judicial review then specifically argued that the provisions of the article are limited, therefore, they are contradicting with Article 1320 jo. 1330 jo. 1792 Indonesia Civil Code which allows anyone to become proxy as long as they meet the requirements according to the law. In addition, Article 15 paragraph (6) PUPR Reg 23 is considered by the applicant as limiting the granting of power of attorney only to “an employee”.

    Supreme Court’s consideration
    MA considers, if the owner’s representative and the owner are unable to attend, they can give power of attorney only to the closest family to attend and their interests, while for owners who are legal entities, they give power of attorney only to permanent employees. Whereas the use of the phrase owner’s representative in the Article shows that the a quo norm places more emphasis on regulation on representative. This aims to provide protection to the condominium unit owner who is unable to attend by giving the power to attend to represent his interests. The written power of attorney is required as evidence to determine the truth of the data from the parties represented or those who acts as representative.

    The difference lies from the purpose of the power of attorney as regulated in Article 1320 jo. 1330 jo. 1792 Indonesia Civil Code which is an agreement/contract that creates rights and obligations and binds the parties involved in it, so that in this case the difference is clear with Article 15 paragraph (3) and paragraph (6) PUPR Reg 23 does not conflict with Article 1320 jo. 1330 jo. 1792 Indonesia Civil Code.

  • Applicants’ argument towards the Article 19 paragraph (3) PUPR Reg 23.
    The applicant stated that the provisions of Article 19 paragraph (3) PUPR Reg 23 are contradicting with Article 77 paragraph (1) the Condominium Law, that the provisionsliminating the right of the condominium unit owners in the decision-making mechanism for the election of PPPSRS management and supervisors, with a mechanism one man one vote system.

    Supreme Court’s consideration
    MA considers that the provisions of Article 19 paragraph (3) PUPR Reg 23 is a regulation on the right of the condominium unit owner, while Article 77 paragraph (1) of the Condominium Law, emphasizes the regulation regarding the rights of the members of PPPSRS. Both are different because the condominium owner does not automatically become a PPPSRS member. Under the provisions of Article 20 paragraph (1) PUPR Reg 23, PPPSRS members includes the tenants who have the power of attorney from the condominium unit owner, and the one man one vote system in the decision-making mechanism for the selection of PPPSRS management and supervisors is already appropriate, because it can protect the interests of the condominium unit owner from a monopoly of votes from certain parties, so that Article 19 paragraph (3) PUPR Reg 23 does not contradict with Article 77 paragraph (1) Condominium Law.

  • Applicants’ argument towards the Article 24 paragraph (1) and Article 28 Paragraph (2) of PUPR Reg 23.
    The applicants argued that the provisions of Article 24 paragraph (1) PUPR Reg 23 and Article 28 paragraph (2) PUPR Reg 23 are conflicted with each other, in regards with the issue of differences in time limits to complete the management structure and management record in the articles of association (AD/ART). Thus, by contradicting the two articles in PUPR Reg 23, the applicant considers the two provisions as unenforceable and contradicting with the principles of the formation of legislation as referred to in Article 5 and Article 6 the Laws Formation Law.

    Supreme Court’s consideration
    MA considers that Article 24 paragraph (1) PUPR Reg 23 is a provision that regulates the duties of the head of the management to regulate and complete the management structure, and the 2 month time limit is to ensure the existence of the PPPSRS organization, so that organizational programs can be implemented as appropriate, while the provisions of Article 28 paragraph (2) PUPR Reg 23 more regulates about the recording period, deed of establishment and AD/ART relating to the legality aspect of the organization. Therefore, it is not related with Article 24 paragraph (1), where each of them can be carried out and does not conflict with the principles of the formation of legislation as referred to in Article 5 and Article 6 of the Laws Formation Law.

  • Applicants’ argument towards the Attachment II of PUPR Reg 23.
    The applicants argued that Attachment II PUPR Reg 23 has no basis for its formation, therefore, contrary to the Condominium Law since the Ministry does not have the authority to regulate PPPSRS, and PPPSRS should be further regulated under the Government Regulation.

    Supreme Court’s consideration
    MA considers that the Attachment II of PUPR Reg 23 explains the requirements for anyone who can be elected to be the management or supervisor in the Condominium. And the condition “is not in the status as a member of the management and supervisor of other Condominium”, has aimed to protect the interests of the owners and tenants as well as to function the Condominium as residences because in principle, the Condominium not only consists of buildings, land, and facilities but also of the human element as the building occupants. The management of the Condominium is not only about management of the building, but also management of its occupant. Thus, in practice the management and supervisors of the Condominium directly knows the environmental conditions of the Condominium. It is appropriate if a person can only become a manager or supervisor at his place of residence. That provision does not conflict with the Condominium Law.

Despite this decision by the Supreme Court, the PUPR Reg 23 is later revoked by the Regulation of Minister of PUPR Number 14 of 2021 on the Association of Tenant and Condominium Unit Owners.

Tubagus Wahyu Ryan Wardhana