The Validity of a Settlement Agreement as a Basis for Non-Performance of Payment Obligations Under a Credit Agreement and the Qualification of Coercion as an Unlawful Act (Supreme Court Decision Number 3062 K/PDT/2024)

This study analyses Supreme Court Decision Number 3062 K/Pdt/2024 to determine whether the alleged invalidity of a Settlement Agreement justifies non-performance of payment obligations under a Credit Agreement, and whether alleged coercive debt collection constitutes an Unlawful Act. Using normative juridical research, the study finds that a Settlement Agreement vitiated by a defect of consent may affect only the obligations arising from it, not those under the earlier Credit Agreement. The Supreme Court did not declare the Settlement Agreement dated 5 October 2018 valid or invalid, but rejected the claim because the Unlawful Act was not proven. Coercion may in principle constitute an Unlawful Act under Article 1365 of the Civil Code, yet here unlawfulness, fault, loss, and causation were not sufficiently proven.