Vivas vs Monetary Board of BSP GR No 191424 07 August 

2013

Facts: The Rural Bank of Faire, Incorporated (RBFI) was a duly registered rural
banking institution that the corporate life expired on May 2005. Vivas and the new
management team conducted internal audit and introduced measures to revitalize
the dismal operation of the bank. BSP on December 2006 extended RBFI corporate
life for another 50 years and approve the change of its name to EuroCredit
Community Bank, Incorporated (ECBI).

General examination of ECBI from 2007 to 2009 were conducted by BSP and was
placed under Prompt Corrective Action (PCA) by the Monetary Board in 2008
because of the serious findings and supervisory concerns noted during the general
examination. The MB posited that ECBI unjustly refused to allow the BSP examiners
from examining and inspecting its books and records and hence issued Resolution
No. 726 imposing monetary penalty/fine and referred it to the Office of the Special
Investigation for filing og appropriate legal action.

The MB issued Resolution No. 823 on June 2009, approving the issuance of a cease
and desist order against ECBI, which enjoined it from pursuing certain acts and
transactions that were considered unsafe or unsound banking practices, and from
doing such other acts or transactions constituting fraud or might result in the
dissipation of its assets. It was also prohibited from doing business in the
Philippines and to place its assets and affairs under receivership through OSI
recommendation.

Vivas filed petition for prohibition ascribing grave abuse of discretion to the MB for
prohibiting ECBI from continuing its banking business and for placing it under
receivership.

Issue: WON petition for prohibition will lie against MB.

Decision: The petition must fail.

Vivas availed of the wrong remedy. The resolution issued by MB placing the bank
under receivership may not be restrained or set aside except on a petition for
certiorari pursuant to RA 7653.

Granting that a petition for prohibition is allowed, it is already an ineffective

remedy. Prohibition is that process by which a superior court prevents inferior
courts, tribunals, officers, or persons from usurping or exercising a jurisdiction with
which they have not been vested by law, and confines them to the exercise of those
powers legally conferred.

The proper function of a writ of prohibition is to prevent the doing of an act which is
about to be done. It is not intended to provide a remedy for acts already
accomplished. Settled is the rule that prohibition does not lie to restrain an act that
is already a fait accompli.

*Fait accompli -a thing that has already happened or been decided before those
affected hear about it, leaving them with no option but to accept.