A Legal Analysis on Novation of Joint Business Loan Due to Debtor's Divorce

Abstract

The present study aimed to analyze the novation of joint business loan due to the debtor's divorce. The study employed normative legal approach. The data were collected using literature study on relevant documents and books. Following the discussion, novation due to divorce should be firm and obvious for the husband as a new debtor, this is in line with article 1415 of Indonesian Civil Code. Moreover, novation should comply with article 1320 of Indonesian Civil Code. The old debtor, who was consisting of two people, is substituted by the husband as the new debtor. This substitution frees the wife from the obligation to repay the debt. The husband agrees and completely accepts the debt renewal. Due to this substitution, the creditor is no longer allowed to ask payment from the wife even if the husband is declared bankrupt unless the novation explicitly states that the creditor can ask the payment from the wife.