a. YES, the dismissal of a petition for insolvency does not preclude the distressed corporation from filing a petition for corporate rehabilitation. The dismissal of the petition for insolvency only means that the corporation may still be restored to solvency.
b. YES, the dismissal of a petition for rehabilitation means that the corporation can no longer be restored to solvency. Hence, it can file a petition for insolvency.
c. All assets of a corporation under rehabilitation receivership are held in trust for the equal benefit of all creditors, precluding one from obtaining an advantage or preference over another by the expediency of attachment, execution or otherwise. Once the corporation is taken over by a receiver, all the creditors stand on equal footing and no one may be paid ahead of the others. This is precisely the reason for suspending all pending claims against the corporation under receivership. This is called the “pari passu principle”.
The reason behind the indiscriminate suspension or stay order in relation to the creditors’ claims is to expedite the rehabilitation of the distressed corporation by enabling the management committee or the rehabilitation receiver to effectively exercise its/his powers free from any judicial or extrajudicial interference that might unduly hinder or prevent the rescue of the debtor company. It also recognizes the assets of a corporation under rehabilitation held under trust for the equal benefit of all creditors under the doctrine equality is equity, whereby all the creditors ought to stand on equal footing, and not one of them should be paid ahead of others.
YES. Upon receipt of the report of the SED, the Monetary Board is authorized to take any of the actions enumerated under Sec. 30, RA No. 7653, otherwise known as the New Central Bank Act, leading to the receivership and liquidation of a bank or quasi-bank. There is no requirement that an examination be first conducted before a banking institution may be placed under receivership.
A conservator is appointed if a bank or quasi-bank is in a state of continuing inability or unwillingness to maintain a condition of liquidity deemed adequate to protect the interest of creditors and depositors. The conservator shall take charge of the assets and liabilities of the bank and exercise management and exercise other powers to restore the bank’s viability. The conservatorship shall not exceed one year. A receiver is appointed generally if the realizable value of the bank’s assets as determined by BSP is less than its liabilities. The receiver shall take charge of the assets and liabilities of the institution and administer the same for the benefit of its creditors. The receiver shall determine within 90 days whether the bank can be rehabilitated, otherwise, he shall recommend the closure of the institution.
I will advice the receiver that the Bulk Sales Law does not apply to both options. Section 8 of the Bulk Sales Law expressly provides that it will not apply to executors, administrators, receivers, and assignees in insolvency, or public officers, acting under judicial process. In this case, the receiver is acting under judicial process.
a. NO, the bank president’s act is not valid. He had no authority to enter into the financing agreement. Z Bank was ordered closed and placed under receivership. Control over the properties of Z Bank passed to the receiver. The appointment of a receiver operates to suspend the authority of the bank and its officers over the bank’s assets and properties, such authority being reposed in the receiver.
b. NO, the exclusive option granted to the investors, having been entered into by one without authority to do so, is unenforceable. The bank, therefore, cannot be compelled to sell the property. Under Section 30 of the R.A. No. 7653, New Central Bank Act, the properties of Z Bank should be administered for the benefit of its creditors. The property in question can be disposed of only for the purpose of paying the debts of Z Bank.
NO. The salesgirl’s understanding that coins are not legal tender is not correct. Coins are legal tender in amounts not exceeding P50 for denominations from 25- centavos and above, and in amounts not exceeding P20 for denominations 10-centavos and less.
The law on Secrecy of Bank Deposits is itself merely a statutory enactment, and it may, therefore, be modified, or amended (such as by providing further exceptions therefrom), or even repealed, expressly or impliedly, by a subsequent law. The Secrecy of Bank Deposits Act did not amount to a contract between the depositors and depositary banks within the meaning of the non-impairment clause of the Constitution. Even if it did, the police power of the State is superior to the non-impairment clause. RA No, 6832, creating a commission to conduct an investigation of the failed 1989 coup d’état and to recommend measures to prevent similar attempts to seize power is a valid exercise of police power.
a. NO. Foreign Currency Deposits law applies to foreign currency deposit accounts constituted in the Philippines and not when constituted abroad. In this instance, the foreign currency deposit was made abroad.
b. NO. Sec. 2 of the Law on Secrecy of Bank Deposits provides that all deposits of whatever nature with banks or banking institutions in the Philippines including investments in bonds issued by the Government of the Philippines, its political subdivisions and instrumentalities, are hereby considered as an absolutely confidential in nature and may not be examined, inquired or looked into by any person, government official, bureau or office. It must be noted that Bank Secrecy Deposits Law only applies to deposits with banks in the Philippines and not when deposited abroad as in the instant case.
The contention of X is not correct. Deposits in the context of the Secrecy of Philippine currency deposits include deposits of whatever nature and kind. They include funds deposited in the bank giving rise to creditor-debtor relationship, as well as funds invested in the bank like trust accounts. (Ejercito v. Sandiganbayan, G.R. Nos. 157294-95, Nov. 30, 2006)
