Court of Appeals reverses RTC ruling on Banco Filipino

MANILA, Philippines - The Court of Appeals has recently re-affirmed an earlier decision made by the appellate court nullifying an order issued by the Makati Regional Trial Court (RTC) ordering Bangko Sentral ng Pilipinas (BSP) and the Monetary Board to release P25-billion financial assistance to Banco Filipino Savings and Mortgage Bank (MB).

The CA’s former Special Tenth Division, in its minute resolution penned by Associate Justice Hakim Abdulwahid last Feb. 16, has turned down due to lack of merit the motion for reconsideration (MR) filed by Banco Filipino assailing its decision promulgated on July 28, 2011 which prohibited Makati Judge Joselito Villarosa from taking cognizance of the case.

Concurring with the ruling were Associate Justices Noel Tijam and Ricardo Rosario.

“We have carefully reviewed our decision vis-a-vis the instant motion and the comment filed by petitioners BSP and the MB, and we found that the issues raised and the arguments advanced are mere rehash of those already considered and passed upon, and no new issues or substantial arguments have been presented to justify the reversal or modification of the assailed decision,” the CA said in its resolution.

The MR filed last Oct. 3 by Banco Filipino has failed to convince the appellate court that the RTC has jurisdiction to hear the case.

In its July 2011 decision, the CA said that the Makati RTC has no jurisdiction over the petition for certiorari and mandamus filed by Banco Filipino, saying the case should have been filed with the appellate court, pursuant to Rule 65, Section 4 of the 1997 Revised Rules of Civil Procedure.

Earlier, the CA had denied the petition filed by Banco Filipino stockholders to stop the implementation of MB Resolution No. 372-A issued on March 17, 2011 that placed the savings bank under receivership and stopped its operations nationwide.

Banco Filipino claimed that BSP padlocked the bank in order for them to avoid compliance with the order issued by the Supreme Court in 1991 directing BSP to reorganize the bank under a workable plan until such time it can operate without prejudice to its customers and depositors.

Under Section 84 of Republic Act 7653 or the New Central Bank Act, the BSP is allowed to grant emergency loans to banking institutions under serious financial pressure, such as Banco Filipino, as long as they are not insolvent.

Banco Filipino said its closure could be blamed on BSP’s refusal to release the P25-billion financial package and regulatory relief to the bank.

In 2011, the CA reversed a decision of the Makati RTC that ordered the BSP and its policy-making body, the MB, to provide up to P25 billion in financial aid and other regulatory relief to Banco Filipino.

The appellate court issued a writ of preliminary injunction last February against the trial court’s assailed order to prevent the BSP and MB from suffering “grave and irreparable injury” pending a decision on the case.

The injunction order stopped the Makati Trial Court from conducting further proceedings on Banco Filipino’s civil case which intended to get a rehabilitation package from the BSP.