ORENDAIN v BF HOMES

Y, a domestic corporation involved in developing and

selling residential lots filed a petition for rehabilitation
and suspension of payments due to its liabilities.
SEC ordered the appointment of a rehabilitation
receiver with herein X as Chairman. Y represented by
petitioner X sold a parcel of land to the Local Superior
of the Franciscan Sisters of the Immaculate Phils. Inc
(LSFSIPI). SEC ordered a new committee of receivers
and relieved X of its duties. Y then filed before the
court an action for reconveyance of the property sold
to LSFSIPI alleging X acted in its individual capacity
and therefore had no title over the property. X argues
RTC had no jurisdiction over the case since Y's suit
was instituted against him as its former receiver.

Bar Q: Does the reconveyance suit involve a intra-

corporate dispute cognizable by SEC?

Answer: NO. The SC once held that jurisdiction over

the subject matter is conferred by law. The nature of
an action, as well as which court or body has jurisdic‐
tion over it, is determined based on the allegations
contained in the complaint of the plaintiff, irrespective
of whether or not plaintiff is entitled to recover upon
all or some of the claims asserted therein. The LSFSIPI
is neither an officer nor a stockholder of Y, and this
case does not involve intra-corporate proceedings. In
addition, the seller, X, is being sued in his individual
addition, the seller, X, is being sued in his individual
capacity for the unauthorized sale of the property
in controversy. Hence, there is no cogent reason to
sustain petitioner’s manifestation that the resolution of
the instant controversy depends on the ratification by
the SEC of the acts of its agent or the receiver because
the act of X was allegedly not within the scope of his
authority as receiver. 

TRADERS ROYAL BANK v IAC

X filed a case against Y before the RTC Pasay for the
recover of the sum of money obtaining therein a writ
of preliminary attachment directed against the assets
and properties of Y. Pursuant to the writ of attachment,
Deputy Sheriff Santiago levied barrels of aged or
rectified alcohol found within the premises of Y. A third
party claim was filed with the Deputy Sheriff by herein
respondent Z claiming ownership over said attached
property.

Z instituted before RTC Bulacan asserting its claim of

ownership over the properties attached with prayer
for the issuance of a writ of Preliminary Mandatory
and Prohibitory Injunction. Z was to be the owner of
the disputed alcohol and his application for injunctive
relief was granted.

X filed with the IAC a petition for certiorari and prohib‐

ition with application for writ of preliminary injunction
to annul and set aside the Order of RTC Bulacan to
dissolve the writ of p.i.; to prohibit respondent judge
to annul and set aside the Order of RTC Bulacan to
dissolve the writ of p.i.; to prohibit respondent judge
from taking cognizance of and assuming jurisdiction
and to compel Z and Provincial Sheriff of BUlacan to
return the disputed alcohol to their original location at
Y's warehouse in Bulacan.

Bar Q: Does the RTC have the authority to issue, at

the instance of a third-party claimant, an injunction
enjoining the sale of property previously levied upon by
the sheriff pursuant to a writ of attachment issued by
another RTC?

Answer: YES. Generally, the rule that no court has the

power to interfere by injunction with the judgments
or decrees of a concurrent or coordinate jurisdiction
having equal power to grant the injunctive relief
sought by injunction, is applied in cases where no
third party claimant is involved, in order to prevent
one court from nullifying the judgment or process of
another court of the same rank or category, a power
which devolves upon the proper appellate court.
The purpose of the rule is to avoid conflict of power
between different courts of coordinate jurisdiction and
to bring about a harmonious and smooth functioning
of their proceedings.

NEW CENTRAL BANK ACT, SEC 30

Section 30. Proceedings
30. Proceedings in Receivership and
Liquidation. - Whenever, upon report of the head of the
supervising or examining department, the Monetary
Liquidation. - Whenever, upon report of the head of the
supervising or examining department, the Monetary
Board finds that a bank or quasi-bank:

(a) is unable to pay its liabilities as they become due in

the ordinary course of business: Provided, That this
shall not include inability to pay caused by
extraordinary demands induced by financial panic in
the banking community;

(b) has insufficient realizable assets, as determined by

(b)has
the Bangko Sentral, to meet its liabilities; or

(c) cannot continue in business without involving

probable losses to its depositors or creditors; or

(d) has willfully violated a cease and desist order under

(d)has
Section 37 that has become final, involving acts or
transactions which amount to fraud or a dissipation of
the assets of the institution; in which cases, the
Monetary Board may summarily and without need for
prior hearing forbid the institution from doing business
in the Philippines and designate the Philippine Deposit
Insurance Corporation as receiver of the banking
institution.

            For a quasi-bank, any person of recognized

competence in banking or finance may be designed as
receiver.

            The receiver shall immediately gather and take

charge of all the assets and liabilities of the institution,
            The receiver shall immediately gather and take
charge of all the assets and liabilities of the institution,
administer the same for the benefit of its creditors, and
exercise the general powers of a receiver under the Re‐
vised Rules of Court but shall not, with the exception
of administrative expenditures, pay or commit any act
that will involve the transfer or disposition of any asset
of the institution: Provided, That the receiver may
deposit or place the funds of the institution in non-
speculative investments. The receiver shall determine
as soon as possible, but not later than ninety (90)
days from take over, whether the institution may be
rehabilitated or otherwise placed in such a condition
so that it may be permitted to resume business with
safety to its depositors and creditors and the general
public: Provided, That any determination for the
resumption of business of the institution shall be
subject to prior approval of the Monetary Board.

            If the receiver determines that the institution

cannot be rehabilitated or permitted to resume
business in accordance with the next preceding
paragraph, the Monetary Board shall notify in writing
the board of directors of its findings and direct
the receiver to proceed with the liquidation of the
institution. The receiver shall:

(1) file ex parte with the proper regional trial court, and
(1)file
without requirement of prior notice or any other action,
a petition for assistance in the liquidation of the
institution pursuant to a liquidation plan adopted by
the Philippine Deposit Insurance Corporation for
institution pursuant to a liquidation plan adopted by
the Philippine Deposit Insurance Corporation for
general application to all closed banks. In case of
quasi-banks, the liquidation plan shall be adopted by
the Monetary Board. Upon acquiring jurisdiction, the
court shall, upon motion by the receiver after due
notice, adjudicate disputed claims against the
institution, assist the enforcement of individual
liabilities of the stockholders, directors and officers,
and decide on other issues as may be material to
implement the liquidation plan adopted. The receiver
shall pay the cost of the proceedings from the assets
of the institution.

(2) convert the assets of the institutions to money,

(2)convert
dispose of the same to creditors and other parties, for
the purpose of paying the debts of such institution in
accordance with the rules on concurrence and
preference of credit under the Civil Code of the
Philippines and he may, in the name of the institution,
and with the assistance of counsel as he may retain,
institute such actions as may be necessary to collect
and recover accounts and assets of, or defend any
action against, the institution. The assets of an
institution under receivership or liquidation shall be
deemed in custodia legis in the hands of the receiver
and shall, from the moment the institution was placed
under such receivership or liquidation, be exempt from
any order of garnishment, levy, attachment, or
execution.

            The actions of the Monetary Board taken under

            The actions of the Monetary Board taken under
this section or under Section 29 of this Act shall be
final and executory, and may not be restrained or set
aside by the court except on petition for certiorari
on the ground that the action taken was in excess of
jurisdiction or with such grave abuse of discretion
as to amount to lack or excess of jurisdiction.
The petition for certiorari may only be filed by the
stockholders of record representing the majority of
the capital stock within ten (10) days from receipt by
the board of directors of the institution of the order
directing receivership, liquidation or conservatorship.

            The designation of a conservator under Section

29 of this Act or the appointment of a receiver under
this section shall be vested exclusively with the
Monetary Board. Furthermore, the designation of a
conservator is not a precondition to the designation of
a receiver.

Last modified: 9:54 PM