Breach of contract is a violation of obligations agreed upon by the parties. A common question arises as to whether such breach can be subject to criminal sanctions under Indonesian law. This article will discuss the concept of breach of contract, its implications in Indonesian civil law, and whether such actions can trigger criminal proceedings.
A contract is an agreement between two parties with mutual interests. However, in its execution, one party often fails to fulfill its obligations entirely, known as breach of contract. Breach of contract occurs when one party fails to fulfill its obligations as agreed upon in the contract. Breach of contract can be due to inability or unwillingness to fulfill these obligations.
In Indonesian civil law, breach of contract is regulated under Article 1234 of the Civil Code (KUHPerdata). The party committing breach of contract may be liable to claims for damages by the aggrieved party. Generally, breach of contract in agreements is not directly subject to criminal sanctions under Indonesian law, unless such conduct also violates specific criminal laws. In cases of breach of contract, criminal sanctions may be imposed depending on the severity of the violation. In the civil law system, criminal sanctions are not commonly applied for breach of contract. Typically, the sanctions imposed are compensation or contract termination, rather than criminal penalties. However, there are exceptions where breach of contract may be considered a criminal act, especially if it involves elements of fraud, embezzlement, or other violations regulated under the Criminal Code (KUHP). Although breach of contract is essentially a civil violation, if it involves elements of fraud or other criminal actions, criminal penalties may be a relevant option according to applicable law. Parties aggrieved by breach of contract may file civil claims to obtain compensation for the damages suffered.
Author: Imola Raihan Kamesjwara, S.H.
Source:
Kitab Undang-Undang Hukum Perdata.
