QUIMOYOG DARYLLE JOHN B50

Title: BPI Family Savings Bank, Inc. v. St. Michael Medical Center, Inc

G.R. No.: 205469

Date: [Decision dated August 30, 2012, and Resolution dated January 18, 2013]

Parties:

1. Petitioner: BPI Family Savings Bank, Inc.

2. Respondent: St. Michael Medical Center, Inc.

Facts:

- SMMCI, owned by Spouses Virgilio and Yolanda Rodil, planned to upgrade its hospital by
constructing an 11-storey building.

- SMMCI obtained a loan from BPI Family to finance the construction.

- Due to financial losses and construction issues, SMMCI deferred the original plans and filed for
rehabilitation in 2010.

- The Rehabilitation Plan aimed to defer foreclosure, secure a moratorium, and seek prospective
investors.

Procedural History

- RTC approved the Rehabilitation Plan with modifications recommended by the Rehabilitation
Receiver.

- CA affirmed the RTC's decision, emphasizing the feasibility of SMMCI's rehabilitation and
dismissing BPI Family's rights violation claim.

- BPI Family appealed to the Supreme Court.

Issues:

- Whether the CA correctly affirmed SMMCI's Rehabilitation Plan.

Ruling:

The Supreme Court ruled in favor of BPI Family, reversing the CA's decision. The Court found that
SMMCI did not qualify for rehabilitation as it had not been in successful operation and solvency.
SMMCI failed to comply with essential requisites for a proper rehabilitation petition, including the
absence of a material financial commitment and a liquidation analysis in its plan. The Court
 QUIMOYOG DARYLLE JOHN B50

emphasized that rehabilitation should be granted only to meritorious cases with compliance to
established rules.

Disposition:

The Decision and Resolution of the CA affirming the RTC's approval of SMMCI's Rehabilitation Plan
were reversed and set aside. SMMCI's Petition for Corporate Rehabilitation was dismissed.